ArcBest (ARCB) 29 Apr 222022 Q1 Earnings call transcript

Greetings and welcome to the ArcBest 1Q 2022 Earnings Conference Call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded on Friday, April 29, 2022. I would now like to turn the conference over to Mr. of President Vice Humphrey, Investor Relations. David ahead. go Please

call, Thank you walk XXXX today's our you joining us. results. for we through quarter will first On the of details

some ArcBest; Chairman today ArcBest. of Officer; additional Anderson, and Judy and me Dennis have Cobb, McReynolds, from be better Chief Joining Danny Yield Officer. CEO Financial are We'll Chief during Yield Officer understand and Loe, ArcBest -- of ArcBest could ArcBest's and commentary President of Asset-light Officer forward-looking David Chief its call. this results, help made and you President statements Logistics Customer To

Forward-looking statements, very subject are and to uncertainties by their risk. nature,

financial release For this conference of non-GAAP To call that certain to and our non-GAAP Reconciliations could also recent slides. in of financial a tables SEC please provide call section this the factors information section refer discussed the measures discussion the provided results, more GAAP in of affect presentation forward-looking meaningful to in are ArcBest's press as of comparisons, our in and includes Additional public complete most release. filings. press discussed described in future measures Information statements the earnings the our earnings outlined the measures related

this webcast. will on or reminder, in us the earlier can ArcBest that you a exhibit X-K with be website can along the XX.X slides As morning, that be the filed we was arcb.com, here follow reviewing found on of the

We will now with begin Judy.

about first Thank joining you quarter XXXX to for results. today our me talk

the want our transpired humanitarian I in the have Ukraine. since Before events call to world acknowledge we including that crisis last begin,

everyone have resolution this calling in or direct to conflict. out We and affected go those peaceful not we to Russia. for operations Ukraine do a hearts joined Our

prospects and to hard our we operating environment, strategic continued conditions confident our it of growth While macroeconomic direction success. anticipate in the and our for and conflict are impact on the long-term is

to now the quarter. Turning

and we how new continue value, It help deliver where invest drive how to Star to global ensure do remains and we economy. we for our unlocking how shaping Our business, creating for North three-point to our guides while opportunities business resources strategy employees. sustainable our customers and the grow also we

and results, first are everything and to strong strategy a quarter and want record XXXX take creating moment to outstanding outstanding merits across acknowledge it. the profitability and business, of I including exceed you day-in of to operating the value a employees. the while margins ArcBest's the improved day-out to meet execution testament the and team's relentless business of Our our and for partners, Thank for shareholders. customers talented our of work dedicated and to you do needs our

our the over reinvestment vision of growth. us in enabled progress quarter begin like to through our to our including our the back areas by and to our walking three each adapt in these with the the marketplace, to through are of I'd technology making while several into quarters people, we efforts. investments driving people. the performance first exceptional business you Starting continually and revenue last solutions has our advance XXXX smart make Our and

capital to made logistics paying the industry landmark success excel and as commitment to contract the is means have we equipment. and investing wage day. by This in Our their and well our current and every tools heart commitment at people and the resources highest as to benefit ABF's in are have labor want they needed of offers ABF facilities in jobs packages ensure of the we one exemplified which the

empty fill offer solutions introducing we and to business which in and without meeting our serve like needs. asset-light proven are positioned ongoing our the And investments By helps sustainable customers We our differentiate win. providers. Next, ourselves ways with customers modes service we to others asset-based across from breadth dynamic capacity of transportation in their our more solutions. of ensure our switching our industry ability solutions pricing

our improve By Finally, time lower technology. innovative overcome and to efficiencies, able dedicating disruptions. operational and costs and new solutions, we're resources in

improving this growth to as of this channels help ArcBest on lowering digital position their been a leader such we a to is Investments great experience a to customers years come drive work digitally provide solidify in as ability Our costs. logistics innovation. example able our interact, better while through as will we've continued as for

commitment while people and investing to initiatives our excellent technologies, organic investors. help in to continue Our new us will also for embracing deliver returns

imperatives continue have remain proven in is three the one front core impressive returns. these grounded we opportunity last that key in in invest tremendous and we As significant our areas The quarters because there strategy in is the and right place of we we have to several deliver performance to ahead, us. business look know

questions. and confident expected we some for continued already income. highlight of like successfully first efforts. will business triple-digit greater has continuing operating positive moved will and additional first trajectory And before take As It And integration increase strategic remain demand solutions in us. percentage Dennis that open to creation. achieving then will take advance ensure a consolidated sustainable revenue value few additional deeper customer-led a finally, quarter detail. Then Cobb to non-GAAP we the and on gains the we're progressing needle seeing customer relationships. we efficiency results David for momentum. record in the first clearly XXXX our see The customer you MoLo the now comments and is all continuing ArcBest's ongoing to move Danny forward, and our our growth quarter as for elaborate up time will it management execute quarter, to and strong accelerate strategy I'd through I'll details In quarter specifics to and our plan of speak yield offer we

more having announced our serving than our customers. with progress the provide carrier financial are more acquisition resources number the when doubled laid for goals the pleased are out of We we towards making partners to we we

Our validated have benefits employees to access the additional of having capacity. customers and

and customer that aids on We are in it it business that in faster to is already helping finding many growth are us cases integrated. loads accounts cover

customer growing Beyond acquisition, in as we in January operation the already map are remote work our leading pipeline, builds long-term well on Phantom to and we road the our Auto complements for future software partnerships also the business The support with with goals. well. the announced our technology and ways It provider aligns existing other positioning recent important innovation our ArcBest success. underway human-centered partnership of and

of nearly begin quarter the in the We solutions we our different. are piloting year. XXX later experience locations in seasons business, market consistently was no and remote-enabled years customer the track freight this volatility to In on our first

and results I'm to incredibly of uncertainty. yield However, quarter short, strategy, to is management needs investors expertise volatility thanks firing that uniquely Cobb. our customer and for and results. to even well And culture and positioned on growing ArcBest and as and people-centric over customer-led superior company navigate during David our our strong is pleased periods we excited are all In by unpredictable turn sustainable cylinders I'll poised first delivering continue market successfully balanced mix, evidenced to conditions it meeting market now and

information growth. Thank investments Slide our and financial update making you, begin as an on our consolidated seen I'll performance time X. provide share I'll our strong on by are to Judy. to highlighting take long-term on we details this power

new we set over record a million. As a the basis, Judy income revenues $XXX of increase mentioned, prior to daily On for consolidated of billion, operating XXX% a $X.X year. XX% non-GAAP increased

quarter XXX% was rate to XX% share quarter grew laws, items be quarter be current first diluted that used shows Asset-Based year. earnings this full and XXXX of was impacted of was that tax rate occur $X.XX. first XX% tax our the EPS XX% our per first to to XXXX daily XX.X%. we adjusted calculate range expect could to non-GAAP the increase discrete non-GAAP XXXX of year. Our $XXX million may tax effective that The year average Slide Under compared the an to last in throughout revenue X by

adjusted XXX basis from of ratio points points. quarters. The for year-over-year XXX The improved first both asset-based is sales a XX.X% at ratio gains quarter of effect improvement operating in non-GAAP operating the asset of mutualizing basis

tonnage customers billed first month. pricing resources. agreements deferred profile to and including higher ever revenue increase Slide The changes revenue be tonnage while business information provided network haven't as trends April is surcharges. shipments Freight managed ABF an XX% we've hundredweight the negotiated We The average mix closed the daily renewals secured asset-based daily XXXX and preliminary were serving quarter available First as reflect increased and highest freight April the continues optimize fuel X% quarter. first the in with and on shipment we to X per X.X% contract was quarter that Total increased slightly. on customer during quarter increased asset-based It increase achieved.

a pandemic. April April increased the XX% XXXX, was total by XXXX reminder, As tonnage versus impacted which

years, the to tonnage changes last year-over-year years. in total best sequential comparisons last in XXXX in the some were Excluding the of April pandemic two and XX the

demand ArcBest details shown trends in the slide versus for the per of event reflecting and strong the events the FleetNet period, revenue metrics X-K business found on can MoLO exhibit year April and be press first businesses higher Asset-Light segment. prior logistics key the total ArcBest Additional XXX% in our quarter services Asset-Light on in increased XXXX X. revenue to addition release. are In

up XXX% year. over non-GAAP Asset-Light was First quarter operating last income

transportation, expedite income solutions control recent project and combined the operating demand in cost favorable with During greater managed drove work international conditions as for our growth market operating and leverage. increased quarter significant created

EBITDA Asset-Light double for press have trend well the X-K Preliminary Asset-Light was of April filed morning. been this was quarter business same which over the than to more exhibit million in period provided release First XXXX. $XX the XXXX

truckload in expedite, brokerage. solutions demand Solid managed revenue drove customer and growth

that the In of comparisons in addition, is quarter XXX%. Slide revenue ended on reflected revenue year-over-year preliminary investments influence MoLo increase of cash X million. daily unrestricted positive and we April short-term truckload shows $XXX the the with of first brokerage

at of was all our million. rate liquidity a the first a total debt is comfortable $XXX are At $XXX interest end quarter, healthy of the position Our in debt X.X%. the million level and net of we on of composite

to net $XXX planned million place. expenditure capital tractors remains million equipment and our in year of continue trailers. suppliers estimated we to for And of delivery coordinate $XXX work range our Our to revenue with this

our increasing quarters, estate driven growth necessary last balances. grew revenues our Asset-Light making In and support upgrades an also progress This have total revenue objectives. receivable XX% the year's investments our by business, before in few growth accounts facility real eliminations. to are experienced of is we of to on consolidated mix increases and planned We primarily this which

we balance completed increase we business, $XXX our in January, capital are Board And continue $XX stock. million of quarter Thursday, The that pursue our our an of operating Our value-enhancing is the ability our repurchase. now to share sheet we shares per cash million another opportunities the generate the make for returning through share. for our we able ArcBest our with dividend flow authorized investments our the ArcBest in strength M&A $XX dividend. simultaneously repurchases combined per and and allocated announced share solid available ensures accelerated previously amount first is shareholders. $X.XX $X.XX previous an of the increase to million On to In quarterly compared quarterly amount announced and buying total in both to purchased

is our authorization As cash enhanced undervaluation our in positioned Board's flows. be remains solid our for excess and operating and continue a current flow. growth have market. additional to investments indication by of enhance strategy we in our the repurchases us allows model buybacks This cash that focuses priority. This and previously, stock and our returns our to dividend employee of strategy the to recognition in with on for business that dilution indicates confidence confidence share a shareholders our allocation opportunistic described Likewise, program of in capital our have offset sustainable returning our an capital our

We industry. investment-grade in will to rate dividend periodically will market targeting our payout credit evaluate From we the ratio metrics. continue relative a our and perspective, leverage

financially for ensuring returns well flows cash might while us to we offer balance the who in strong anticipated are in this economic environment. positive are opportunity for our company, the occur invested these any actions to sheet take those and positioned increase changes Our that year

share another to We you are returns positive and look delivering we and our to momentum industry-leading on build forward as move be able to with through XXXX. pleased results record continuing to

over to turn Anderson. it I'll Now Dennis

Thanks, David.

strategy our results value customer-led drive to and produce long-term continues for Our stakeholders.

strategically the customers. shifted we've with logistics provider seen Over decade, the LTL an as pure-play to past dramatic being we've a integrated level partnership a company, our we're difference from of able to develop in

customer our strategy. differentiator a competitive earlier experience unique we best-in-class deliver continue people we to the our the and at keep the with are them. the Judy to people their a employee deep mentioned is have success. critical address heart that solutions, We to as to ability candidate a And Our in integrated why needs, are key fostered, experience. is proud in best hire relationships we invest business and and investing of best-in-class that's in our our growth culture of

most In serve people our we initiatives locations customer is our new country successful, support first In empowered, ABF serve quarter, needs. biggest ABF. the key the Because to nearly and critical fact, market, well, of asset-based over a retirement. encounter. may we're roles, XX labor hiring uncertainties for held of adding across the When we Freight Despite they competitive across XXX prepared hiring we many events our engaged our customers meet our in were people to growth are and turnover employees navigate whatever well. driver these

our ever program to success. a Our wellbeing our remain winning ArcBest ultimately committed and growth and through created creation. these filled position in investing for our employees growth value a with award-winning an as We career These people work prepare to opportunities. development new key factors continued made purpose. to company their culture training effectively contribute continuous differentiating helps to are and amazing build as supporting providing that We've and and place future

over now our are years Danny As turn with And Loe. it build that for we partnerships foundation the are our trusted do customers to that, I'll come. they to continuing to for growth

enables the Thanks, for can relationships with businesses strong customer breadth the improving Because operations. more what's most direct base a to us is margins across to growth customers' put deep conversations modes right our our our be with our paired customer networks we're we of data large customer. and and mode Deep so Leveraging gives do Asset-Based carrier customers, ensure and yield the with placed agnostic, have understanding increased retention. Asset-Light and we solutions for in our both to efficient our customer management and of expertise, our Dennis. partnerships us our enable partners, of and our for deeper able appropriately while relationships freight

a see environment to yield across continue solutions. We robust all

environment As revenue and our David increase billed fuel hundredweight XX% surcharges. in solid Cobb higher mentioned earlier, per asset-based a reflected pricing

asset-based grew our in a that top in to triple had our our positive while and efforts results. and impact changes increase the Additionally, business the double profile the Within freight operating the line on mix resulted from digits. shipments our revenue optimize in network asset-light was percentage digits,

with our yield a excellence. between we customers of serving management volume balance take macro revenue We the and importance Even and a we leveraging and in recognize also price our our a solutions. expertise of to carriers increases our market of uncertain all the saw by reflected and in across strong strong yield which confident capacity against ability tighter in conditions, achieve backdrop are environment. pride deep great We partnerships the deal appropriate having per shipment,

turn Judy. to over it back Now I'll

Thank you, Danny.

up, We for I our and intermodal managed sustainability our our supply efficiencies do and key area improve address to industry ourselves our that access the to drive of on customers business, customer importance pride wrap truckload naturally chains. want like providing we solutions a As ESG. and operations to of

Carbon our with and challenges. mission to logistics impact Zero a pleased of to we carbon by actively FreightWaves in that world, week, member Day positively group. as through the solving celebrate the are their to committed activities initiatives Summit, Earth participating align pursuing were and We connect working Net Last

closing, third our customers employee share a share remain we strengthening Last important annual through recently approach We matters the service by Sustainability efficiently committed ability we our are on our and element to value and operating when am capital our testaments short-term offerings its align proud Orlando, pleased impact strong we navigate quarter. making have excellence the our results and every released base diversifying quarter open last in reflect the our positioned claims that integrating while report we times. XXXX week to people are excellence the finally, market remarks. to and functions Also an our these the resources our integration trajectory, our global awards of ArcBest those our strategy, our our also while ESG the stakeholders. increasing our substantially It by our supply to our up won allocation Both limiting day cycles second efforts. serve quarterly market that we initiatives and hard Freight And won news, customers, ninth successful strategy other call Forrester, was us sheet. remain are to every dividend. is balanced a I awards to in We ArcBest's announced customer one by in based to be our our sales to to Humphrey, displayed using and our maintaining to commerce company. values received. to facilitating marketing, chain. ATA in may on progress program in flexibility perform confident ArcBest data-driven This going of we now about return to throughout I'm forward. prestigious In approach of advance us safely creating it balance carrier strong comprehensive for work pressures. program business couple ESG financial our award our to responsibly concludes excellence loss true exposure corporate matters enables in whatever better to providing capital questions. and looking That allows us. David award our the repurchase an in to and free first strategy, We're prevention update our and growth and to cash division a shareholders, extending consistently and the integrated conditions goals prepared serve more many product collaboration, honors accelerate for was our of two of time. can business LTL the No that earnings The ABF rooted cash investing execution on has in this that successfully to optimize with night customers to success winners. and while return a on partner of customers. in and flow power simultaneously

Okay. Frank, think ready we're questions. I for some

you. with question Wetherbee from Thank [Operator Our first Chris Instructions] comes Please Citi. proceed.

Great. Thanks. morning, guys. Good

morning. Good

So on LTL about the volume maybe thinking the first side environment.

So, and thanks very are of for saw I you're bit hearing multi-year terms we're us at what to comps looking generalized if giving you sense of the growth sort you a customers Obviously, anything, the an pace get challenging of of in quarter you're your April a a it how acceleration given the of second on year. if last -- the tonnage. looks wanted it kind stack from demand the Have basis. activity. like deceleration, seen in of a

a want So, of get your what customers you're feeling and sense I how to just feeling? are

conversations telling some as chains. maybe we're strong meeting other supply business backlogs in Chris, demand are looking meeting having them the they're really some demand in feeling and are they supply ways for Hey that impacting ongoing ahead and about definitely the their us our related do and of The demand we've definitely their that, for to is their to and seeing customers' Customers But that a talking well. still Morning. to Dennis and slowdowns still this shortages labor thanks is had looking shortages still chains. They're with that. question. us than

renewals. you some continue sense the a pricing demand Okay, double-digits in double-digit like you thinking the to Is comps beginning we guess about want that or think is the to on possible And right that It we're get that's year? about pricing sounds of process? just then it how last fairly these get challenging have you're like good. to I the to do it side, durability of that think into? sustainability increases now? Just throughout Do environment how helpful. when the sounds we're about see

Danny. is this Chris,

customers. hit do sure to I you our strong compensated for I'll to services as that still The And as for of second the we tell the our to providing half think customers is providing there. and have make focus our demand you customers just we're harder value of a Dennis now, key the have continuing that value points sure through year. right is and said, conversations for we're conversations the couple to our comps get with our customers. we're just making go we'll our continue the and

Okay.

ahead go -- So

Just one just one follow-up part that. -- I want on to of

their helps part from that thing we and the Dennis situation are conversations and that do one their both looking really is think these Danny I approaching of customer, perspective. at

from and I with in relationships as you're that think to we're value uncertain we because really have that. And these helps. do able the credibility And helps them. coming that trust through these times creation going

had the think other a Judy -- there key I I point too.

dynamic the right with customer that basing of their that what is for what you talk the at throughout the change the on capacity with agnostic of solutions, the kind customers depending as and the year being of time. breadth situation solution market more go you base Just

the I more, I'll sense. makes have but hook get few I know David. That from Okay. a

so Appreciate it. it Thanks for much over. I'll this pass So, the morning. time

Please question comes Morgan Ravi proceed. Stanley. next with from Our Shanker

Christyne on Hey, McGarvey taking for this Ravi. the question. Thanks is for

Christyne. morning Good

Morning, guys? how are you

Good.

cycle concern maybe dynamic to here. wanted ask lot question. Clearly, a Just the kind there's about of of a

how a guys thinking the really trickling coming of then maybe question mean the pandemic I here? thinking from that front of are you kind kind OR you about has So, What from maybe you strong. you really, out can the I of of are mean are back guys performance the earlier? seeing importantly, cycle guys how up been volume more ask But regardless I to kind two-parter. guys of perhaps on two,

future? look OR about softer how do a like, of enter you and the So some backdrop bit sustainability maybe you of the talk in point what might a at thinking if gains can the think kind you're of about we those

Hi the Danny. Christyne, off talking start this just is I'll environment. about

competitors you calls, other softening listen in spot think our market. on the been truckload I the a if to there's definitely

And answers acknowledge is solutions and to customer. we're when in our see have our that. to we the that provide multiple so we confident that But ability right

so, base. our we for within customer us opportunity market And know significant have we that

so, cycle to that we us, doesn't us. but feel the with opportunities like because of cycle matter grow as does And it much, in matter through lay front any can we the

turn And back so, I'll of of over end for it the kind the questions for.

Yeah. there I Hey add to us is have the of Christyne, this we mentioned I'll is the end at Dennis. set on in that. opportunity mean, that Danny tremendous. front

we've so some that when there. also with growth has about our And in think helped we and our opportunity the as mentioned, margin cycles improvement. for business improvement is And you that margin through business seen growth

from great in market we're about teams capturing pipeline feel opportunity. our teams well. the to really of and customer as got And We've that's so And focused that service our that approach on grow front marketing sales here. aligned with and us

it. whole we that to not starts to starts think balance Got just the the one-for-one maybe transactional how TL But with maybe that flow? slow risk to the about as of in, the a there of are market. segment, spots the know in use it's any doing Is guys or network. And should if the triple kind guys some business you market particular help commentary helpful. Really day to clearly day out. about quick follow-up kind you of spot what I as a

Yeah.

of see there, is the addition is So, in and business. the area what one, the contract reasons works acquisition one of two this the model truck is the -- we part MoLo the of of itself things for

of to us the market. total through kind a of And type so contract grow business a truckload continue you'll percent see truckload as deflationary

of well we And much been to than better expertise out the to walk so that the we're positioned through the in bounce past. have just guys there is

kind I the Asset-Based question think pricing. to dynamic was about the network the and other

no market. so, of this to that point And demand or we've deflationary in lowering seen

it. Got

[indiscernible] Christyne,

you. Thank

with comes proceed. question Stephens. Jack Please next Atkins Our from

Okay, Thanks taking great. questions. my for

morning, Good Jack.

Good morning, Judy.

today that MoLo that So you year? update integration Danny, MoLo maybe accretion Just seeing for expectations on spot get does be how into us question maybe going? this maybe based earlier we're market first of pressure on your deflationary a what bit could would the there is the forward perhaps pull for on And that? curious in to maybe and

of we're still into piece. on pieces to shipments earlier, just in into But integration get that actually in We're all of there. mentioned specifics accounts I we're loads together platform in some of into Judy bring accounts would MoLo seen better won't MoLo where kind also moving roll accretion it's what have to growth by the pleased those We of are honestly with year. the for that And the resulting per over the capacity. are the say on integration. the we We're that's Yeah. end we've day margins. of But platform right serving first accounts integrating to the our first platform it. looking MoLo we these We're the customer the now. in everything stages a of from the resulting of is And the and better we access better

we've the the strong is for seen. what still rationale acquisition business with So

to still aligned comfortable where are. the platform, but we're getting are in We the get with the shipments of all progress early same technology we're we there stages on making and

But Danny? MoLo spot the accretive would make sooner, market not declining right in

with contract market, the deflationary to in where of spot that be to helps mention that a deflationary in in a market contractual bring want how the too. and closer market we in a helps and balance of think I'll you again MoLo their and expertise long-term us that helped manage I business to

sequential in it's helpful. then correct Typically, in you our keep quarter. our are it and through, first we're takes of in Cobb, back seasonality That's this the normal you guess Can David second maybe think reference the mind of last or quarter puts to question. year, outperformed And I should first maybe significantly Okay. is assume normal as Obviously, ratio. basis model? XXX maybe my maybe in seasonality the points us X-K change updating operating we help -- for there some improvement. the around quarter

there's to Yeah. pointed that was some the I I as quarter with is Certainly, And managing fourth going we've first always negatives Dennis. in positives historically that Danny going second. I think -- I first seen unusual the Thanks, from XXX to believed well we referenced It's Jack. in think business that we just we're you to just -- a you And have But environment XXX quarter. would the first. and the And heard to at points have an this call out but things what quarters. second out have five and impact say and of on time. last very the significant years to nothing from as the lot from the there's

right. time All guys. you for Appreciate Okay. it. Thank the

Thank you.

question comes Please next Scott Research. from with proceed. Wolfe Group Our

you Hey. Thanks. remind us… Can Good morning.

morning, Good Scott.

Good morning. profit Can the you And incremental the this share for and given right? there's that is benefit that wage is year? I remind no inflation think us what already where is, OR

which of at put is level the welfare benefit, annual high-end wages the an On at together. average that increase wage of OR pay And health we're been about X% that's that Scott. X% overall down. all on the you pension OR a incentive Yes, is and a basis, of when then

that. So encouraged do to able to we're be

I so there. have employees option having And appreciated think our that

setting we've we mean year of I inflation increases if mean, for a starting that dramatic about mean high and with year, way up think I fair margin Is if we're single-digit wage I we're improvement. another to pricing So got pretty two, it? have another

looking business about -- we is that's the we have. price that growth the Well, and opportunities I And that exceeds price we're talked investing for as the inflation. value idea that we and in think

want we both board. our so And to the facilities and the people through And investing technologies, in we're across grow this.

momentum the think the So I is for improvement there. margin and is good opportunity also

then slow Okay. And just saw up given used with spot? that you're be start that seeing the real it all to business at places expedited, of you're seeing world the the down if first just quick, maybe one slow Panther to

first for Scott, the some us. was this a contributor quarter in that. – expedited to project Danny. There We is worked were strong

a still seeing the headwind the little part than of disruption bit the a auto strong supply of in we other have may that We're business. us. we chain impacts that So that, But for a quarter. little in second

the for you Thank time guys.

you. Thank

Please question with Todd from Markets. proceed. KeyBanc next comes Capital Fowler Our

and morning. Hey, great. Thanks good

Thank you, Todd.

Judy, Hey, good morning.

improvement answer And touched high probably So general first love the the but bit I And quarter something think would question pre-panic would difficult just OR that. really of I precise like to this XXs little was your or mid which kind to this of but be is now a thoughts. sub-XX, we're earlier, some that of a thoughts environment to, on drivers the margin of do you to kind any some How – level is structural versus fantastic. what How on much of really the changes, helpful? about within is macro business pricing we've that just that? related be seeing think contributed efficiencies could and that the been your behind strength to of

to supply is that business Asset-Based lot reflect it's interesting expect very times how on interesting, business. needs. for a is Well, to it Asset-Based all back in I combination, probably different the of the but imbalance it's a you'd a so to network and disruption network. think been at I with responsive coming the chain the services. what different is. demand and our parts all of today, Todd, customer causing and it's But know some the of as There's just country say, managed that's me truly It particularly And

the what piece with in challenges better for is in at that, But to us coped of instance, But not that. we visibility had that optimized. that's The things, just labor network. and a allows quarter balance means be things, team been freight active more and we that and the the we kinds only So have have of really challenged yield it, business job manage better we're the that can it's with with does very to first and following at And those great the what terms adding times all like cases time, in a of same in some business, then worth other very too. of the terms a of on a network year. process to typical

But So, have to our the creating do. this, that for Todd scenarios and us. still well best really a overcoming team for credit lot work those we I'll I customers say the for

say. balanced, resources we handled external can We're be see. lot purchase that transportation could were a have other and just We using let's some more better that things all expensive if

the lot optimized And see to and that a we for so we more answers creating better opportunity mentioned, there. of answer us. see a customers And David sustainability, grow, greater matter opportunity just overall to that

of anyway, additional but thought I is And it so color. that combination give I things, a you could

to it has call the precise the it more than just the Yeah. network of can brings a in comments know that throughout difficult was to, I see and results. together it what answer we making been past, think that and I is in the question kind dynamic but team itself No, was the

So I appreciate comments. those

and follow-up this any expectations on but Thanks. update a numbers question, for how Just little that's year? Judy, this rest the the going for that in year? And bit, touched basically with any the on can capacity costs just expansion, for give or of the associated you growth an you my terminal the

comment Hey, it's Todd, got long-term a I'll just multi-year you facilities. a plan to We David. -- place, we've a in Asset-Based really our improve mentioned on Yes. this. expand it's mentioned plan, plan as

-- received we're have that. done was been on by We've And good It see. at employees. have some current begun remodels that some so we're And some our to -- expansions but well working we locations.

increase a to intended. before, of range the digits handle so increased And shipments by looking ability percentage we've to year. mid-single to in said And sort as progressing of that's an we sort get of as end the the we're in

still that's on targets. our So

this Great. morning. Thanks for time the

you. Thank

Alliger Sachs. Jordan with comes Goldman Please next Our proceed. question from

Yes.

the side question on equation. of Asset-Light a the Just

wondering more Was had Maybe EBIT driving bit that if more at of just level a Thanks. it area? it a really percent, side? margin about step-up dollars. what little bit profitability? purely you're this tech highlight in You the you that's step-up sustainability the side talk big that's I'm revenue could pretty but the of on profit a was happening in stuff

saw look service this Danny. the revenue I really is When Hey, lines. Jordan, strong across at the growth we first all quarter results,

and our costs. a the And so kind that of of when lot at, still we think we're fixed scale we of have Asset-Light

and add to are we revenue the costs can grow manage feel with along can comfortable that it. net going we that as that. We so And

bottom drop that can of revenue to a the line. lot we So net growth

Yes, mean so, -- I sorry.

customer conversations momentum add have around Asset-Light well. really acquisition mean, improved services Sorry, strong. as pipeline customers the That's And just I I truckload really with the being would MoLo our since about is strong as the greatly. increased well. we talked about

terms the great at as of there momentum about sustain feel to well. demand ability we so Asset-Light in And

know to So, guess so of in plateau that sort terms new of I will? a but fluctuations, I mean, sort we EBIT should if be million level we I dollars. a move the about if or of, $XX there's going that in is to think you

got still well things with the I between we and set But been being like and evolution out with. then set think, an the a the opportunity margins things. to XXXX, to where this to building when be just look logistics to got integration And The environment. the of about customers, do we've made we've we back X%, overall When put you're and we suite But customers, place for different our is lot And as really feel Asset-Light in a working when much this both Dennis' There solutions any in X% well Asset-Based on Jordan. lot latest we're for works works would us that to well But talking have solutions I longer-term that the navigate are. billion we in side Well, how think MoLO. we We've which those can environment. I XX% market. a be there. company And of environments side within at confident to too of at XXXX $X the for we're well. Panther any of billion in in $X have toward like MoLo. serve specifically of I that customers toward been about working the targets able we acquisitions But in this faced to XX% point with that to them. to that with bought even that that place lot been going years, we those in haven't go. our tax the That's and company we've

but -- for you the So thank question.

question comes with from Our proceed. BOA. Ken next Please Hoexter

morning, Judy and Good Great. team.

Ken. morning, Good

quick question on right. a just inflation, So

we cycles the inflation level I digits. expense didn't mean rise have were you're really guess going And So looking I interest do. raising different. back of Judy, at cycles. rates interest ex-fuel guess double recent or I most different the that really rate We

the the what be on and trucking business your this seen? on what's impact the last look can when different thought impact customers cycle you that how So -- the of we've inflation and one or on than at two --

we mind just Well, naturally overall kind as impact. mechanism structures the as a the on a -- use negotiated to biggest our an that certainly of It's fuel Probably fuel is it the a rate impact -- there's our that of that customers. has that is surcharge part or effect comes of with is part And rates progresses. that's customers.

with But discussion from does is what it what too they're standpoint impact it So don't much way. worry a we that paying.

works with think, their talk and comes again, chain I us how impact they're cost conversations. their we've to that had overall can doing an equation their rather it's to looking way Because, it about when them. for want we supply are back impacting conversations better. to at to that recently solution into they're that's we it look us profit coming for coming to them customers so out the works what more is causes at for impact, it way And customers rise they what do optimization their a margins, being in figure back and and can we're that one way, well positioned the And be keep -- supply that those for best the than we because, really certain in chain It I positioned.

conversation. a great it's So

that innovation conversations And we're these we interesting managed conversation customers other do costs We've invited to grow. by have in made our is very how help you But of some us. them that challenges. seeing impacted we're I how with labor conversations with those we Customers to all in. problems help how just can projects. really -- our costs instance, like. the the For because solutions And which thing inflationary really the in or we've again, this on you level noticed we've reflective it that those investments that's R&D are have interest with been the been positioned, is solve our better that's of they're

expensive having how business, again, they not it's costs we just are it you're than conversation be, business that an But just their about want so, overall we're have manage. And about -- to better. can to a solution the more that's talking but in be

place that that, as in we we done environment, them those I equipment, well that would to And sort really that the people, better. to that the One from getting If have be would those need important be benefits bringing work that the equipment done. gain areas can some it's rented as natural you in on how delivery all be areas When to do like you're this technology successful us we we of and that to of able see there's kinds projects getting and of maybe benefits. purchase those manage transportation have thing in our reduce things. just of of getting can more

And so, answers hope your question? that

through consumer to business slowing fulfillment No, versus if the morning, noted this at it the your one have the that does. of split announcement Amazon of right BXB TFI cycles? to Great. structurally squeeze the of What's the with sustainability, seems it the And more in? here that segment centers, LTL sustain given I business can some for how flowing one deceleration the shifted Just maybe on BXC growth businesses. its and changed thought has

with our to directly serving well years and and also do ago very very, years and great interesting. But the get I ago, of I homes. us, goods grown, the customer an business help its got XX-plus with ability is see -- -- That's has both many We we LTL customers network well. the to doing U-Pack really large ultimate things business think value customers of work delivery for with LTL in with is And small. familiar market we business, increasing. combinations the growing of mean residential that for see one mean things consumers I

our And -- to want on because our have to grow -- I business that, that with on effects big that can And retail and as adapt be, network. let's we've we all so, it of that we're but can to as learned the we're think of what that a of it. the our be there's do. ability have it the industrial the familiar as to well we diversified then have a and also part And business lot there. as But type say focused sustained very of we improve coming together, And customers of like in presence profits part helps we and a to business. you just

Thanks. Appreciate it.

Stephanie Please Moore Truist. Our proceed. from comes next question with

everyone. morning, good Hi,

Hi Stephanie.

some bit on to this know have of just second little I the pilots you year. think the I maybe implementations other initiatives planned update a you really forward some you. us which well? as exciting. you we for any touch of that on other give could maybe that kind the this I of sounds wanted in But well noted technology year, as half Thank can look as an pilots just

route optimization, optimization, with million handling spend that as areas. us well. optimization, everyday projects work that and We've that all as conversations Stephanie, working other Yes. got customers city projects goes and to about business. of on which planning be beneficial we learning in some dock got that the we're dock our work spent strategic type to type on customers that have we We're continuing us really can of City how And transformative Kansas create About also $XXX those in and annually. about good haul labor with pilot for some helps half in are planning Those helping we've visibility more of well. areas on, initiatives. line

we're types that self-fulfillment excited that. made of digital then about So can solutions that part of advancement website. you as doing on is just along mention And of with use Phantom our what we're our customers or really self-help a Auto, the well the

year standpoint to going later us. a a year think their into a next for from helpful both I -- and be standpoint thing cost this is just

to Got technology it. the relates further the as going part vice from us that And as then, legacy it a the MoLo is the could I be Maybe you acquisition to to technology on there standpoint integration of guess, anything some a or or you're needs business? over from in implemented little drilling bring of versa? MoLo that update bit integration

Stephanie, Yes. Danny. this is

truckload over MoLo to our the So migrating platform. are we platform

the that was left And we're automation in really combination about digital We aggregate and things systems us of what we There's the middle there so the our now. MoLo so getting is right the tools a there's the that had things different holds platform. technology forward. digital as there is that's for the go that we're excited of integrated in that

integration The to the first the done. base is thing get is to get

Great. Well, that’s everything from me. Thank you.

Yes.

Stephanie just The data. that makes us other I we much I'll is about thing the say just and better. how real mean, quick excited just information that have we're

Understood. Thanks everybody.

Thanks.

comes question Jeff next Our from Vertical proceed. Partners. Kauffman Please Research with

much and everybody. very in for congratulations and me you Thank squeezing thanks

Thank you, Jeff.

know on quick two because running time. You I short easier we're know,

far about about we signatures process contract are How customer you resigning the through signing. talked year? You were this on how for X% business were

be pricing part you're and a and little to our about it of fourth or I But typically quarter. dealing in that amount Well, of by one-fourth Jeff business doing quarter. And… regular and first. it renewals each each what tends we end on with business contract mean is regular deferred up heavier large

right. All

of to So lot is should about still a contracts that be think the way I signed?

it's mean Yeah. just I ongoing.

going as going business integration MoLo. with even more going about know learning the but now we that there we renewals that's were Asset-Based And get talking that and think right contract work the about well. I is as on we're I done with truckload we have on.

the bit progresses? inflation All side? asset How is right. And fair much the high, tonnage the rates Asset-Light, just Thank I slows down a this that amount to you, with marketplace. of still how the do much has we economy Purchased think transportation about down spot expense down coming a second should one. of are the with year as know year the and expense little rates on trending of the pretty that in and transportation move purchased business? as say, then but is that How Asset-Light later spot

think things that transportation going I certain to in level Asset-Based mean and hiring I in network the for locations sort additional use different balance the resources mean we've a purchase again on. of Well, can some Typically, but haul, got help line well I to are we two a we own city cost in thing. as business of our the be And particularly for prefer but people. with we'll on routes in per basis, reps even city cartage would we that works cartage also mile of and use agents. that do lower again, it's

like that they've we because two, of advantage in just But regular place approach a with the some matter an and gained have about with they people informed buy of and better that's and rates we So getting more of that Asset-Light and MoLo have operation. do of transportation sort One, purchase the carriers the because used that we to our that business, thing. the acquisition. feel tools we've be

the excited about is we're acquisition So, us. And it's encouraged -- that. again, benefiting and

That's deals all and No. for And in of as percent have. I X-K Congratulations thank about those really thought a revenue for you. I transportation Asset-Light. you thank putting helpful. the was that purchased

next with Stifel. Please question from Our Chan proceed. comes Bruce

Hey. here. squeezing Good morning, for everyone, and me thanks

Bruce. Hey,

an I'm portfolio. and when cross-selling quick Just the think the of And about here. know you base How asset Asset-Light. Judy, here has mentioned question a and you your interplay proposition on FleetNet doing? are important I been part then about that always then overall thinking also you UPAC of value

like Any it seem think into story about much those around the parts you as doesn't move as there. overlap there's ArcBest As thoughts business, we the fit of those how forward?

say that. offering for provide instance that other interesting does but solution mean I FleetNet also to you a a base. and diversified ABF has good customer carriers or very for It's services has service Yes.

the – find mix trying or logistics do what interesting an help company just to they But the Cummings, the fit What we the leader of to solution we're of rest about Gary and were just So was customers does developed ago, doing. given us that of more but any or problem oriented. container talking I whether how is they right time a yesterday years was solution their talking roadside than a with trailer. it's nose more it's what ago it's in preventative maintenance. load long a capacity a that trailer whether is The for mean again emergency or U-Pack it in it I helps XX the fill

It's And balance. a kind location so And manage solution cases of developed was improvement and ability it's the consumers. in have some in it years that do-it-yourself an ago to. the a load for great to we by way but like solution to we'd create average

we a and business asset-based the long and with feel works long, it So like fits has for well time.

now where then And just age be? right you That's really in you'd of versus are here. Where quick terms like average Okay. fleet helpful. cleanup a to

the Yes, David has probably details little longer. it's a that. of

Yes.

they're in quarter. out the particularly And X.X our talked like tractors of year little years XX at our receiving city two average age. completed road in average some our tractors, equipment age those units about receiving some drug But bit. As of fact first we a we about

would that's like longer than have we actually some... So to

But of get the the it should by pretty year we to change drastically. end it will the time –

right. that's Yes

Perfect. Thank you.

you Thank

time. your remarks. questions closing with at Mr. Humphrey, continue further Please this there are or presentation no

our we Okay. we appreciate look Well That forward a call that you in to everybody us quarter. joining another concludes – seeing lot. morning. and this Thanks

day please for does ask today. great you for We thank participation the and disconnect That everyone. you line. your a your that conclude conference call Have