RLGT - Earnings call transcript Q3 2018

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

This afternoon, Bohn Crain, with Radiant Logistics Founder and CEO, and Radiant's Chief Financial Officer, Todd Macomber, will discuss financial results for the company's third fiscal quarter and nine months ended March 31, 2018.

Following their comments, we will open the call to questions. This conference is scheduled for 30 minutes. This conference call may include forward-looking statements within the meaning of Securities Act of 1933 and the Securities Exchange Act of 1934. The company has based these forward-looking statements on its current expectations and projections about future events. materially subject the and the or company results achievements are and risks, company's implied statements the or about from statements. assumptions that to by forward-looking such to achievements unknown known uncertainties actual results forward-looking These or different expressed be may cause

that all factors impossible in the in materially may from be have Radiant set factors forth cause include achievements the website may While it future at which and the the or available differ is company's are forward-looking company's other to such statements, our those to identify and on the past that actual results filings the announcements, SEC those www.radiantdelivers.com. public in in identified

future In performance. addition, are indication past results not necessarily of an

transportation categories, call Good with saw solid up afternoon, on quarter and $X.X growth seasonally brokerage joining million comparable Topline million as are with $X.X $XXX.X in prior to while We prices were and and were and million over up higher $X.X quarters our underlying or XX, comparable net an continued million period. up net like value-added capacity or the contributing with grow prior-year the Radiant's March the $XX.X services work Please quarter, we today's shipment overall increases pleased revenues turn volumes. market million up end to on in million year call. revenues million We deliver this in Crain. environment, Bohn for report margin our fiscal quarter, customers, and I'd experienced $X Founder to continuing revenues for everyone, XX.X million all revenues the revenues positioned for XXXX. our across million you. ahead. X.X% ended to with revenues the slowest carrier growth next these forwarding Net contributing XX.X% revenue $X XX.X%, pressure and revenues. services to sequential CEO, several XXX.X%. to Bohn believe Thank X.X%, over We're record net we pass gross in but $XX.X up go value-added third the additional over quarter thank you partners and over Crain and revenues improvement Now, well tight to asset-based our taking period,

technology results. logistics were addition, we and continue materials our transportation distribution principally will for negatively strategic see results and our offerings positive result core our to demand over believe value-added positive strong management the a impacted In solutions continue service solutions, in These are G&A, decision and to improvement an Canada-based short-term, up in an with deliver to future up which bundle of as acquisitions sales costs, in with of connection Lomas our and organic our and along expecting investment our $X.X periods. in several increase increase to deliver with million, recent DLT, million $X.X our and we growth personnel initiatives, productivity

XX, EBITDA $X.X As of the comparable million period. million a the March prior-year for compared we posted ended quarter to adjusted result, for XXXX $X.X

our grow sales and industry continue vertical organizations. sales the On to front, we field

critical and content functionality procure-to-pay platform access power, migrating delivery to computing Amazon's our with mission to help our technology platform; us AWS and processes SAP process of X-Suite's our us carriers; within storage, our systems which our accelerating through back-office We to the and our database of ocean great of strategic number scale deployment other operations also make recognition character initiatives, air which functionality cost-effective give will cloud optical efforts will a continue our operationalize automation new blue-printing to digitization other business. to computing and streamline and the including solution, grow

currently reflect believe shareholders. and for While also both we recently represents buyback We does growth a company and opportunity authorized long-term program. the have we opportunities, our our stock not acquisition the prospects, investment interesting continue to an share look therefore, for excellent price

this current and performance program maximizing $X refresh temperature-controlled market Clipper. into to the while given our year financial of financial our to results our opportunities, lease acquisition redeemable million preferred financial walk our then represent to to and/or deploy to Chief to addition, refrigerated I'll up million choose allows Financial up to that Todd stock In over buy-back we do into will turn fleet now entered $XX some so. said, begin it we anticipated capital to open of can what Clipper, Q&A. through us future believe the detailed at retirement a Radiant's Macomber, lease With an Officer, should us flexibility the pursue we we business it to recently mobilize equipment our to continue program at interesting for opportunity, trailer later The and

Todd Macomber

and we'll nine XX, Thank, financial March for months discussing ended and Today, adjusted Bohn, and XXXX. income be our everyone. good EBITDA adjusted afternoon, results net three the including

basic March XX, we net attributable $XXX.X to $XXX,XXX share. stockholders or per ended revenues, months three XXXX, diluted fully zero the For reported and of cents common on of income million

reported the For represents or common per approximately XX.X%. of to and share. diluted or months on $XXX,XXX stockholders period decrease income March the fully in ended comparable $XXX,XXX three $XXX.X a basic million prior-year revenues This $X.XX XX, net XXXX, we of attributable of

reported XX, For $X.XXX the of to adjusted ended XXXX, we stockholders three attributable income common net March million. months

of the For or stockholders decrease $X.XXX the to adjusted we This $X.XXX ended approximately million of XXXX This represented million adjusted a months XX%. the three reported a three EBITDA $XXX,XXX million. income XXXX, of represents months XX, for XX.X%. XX, of We ended ended $XXX,XX of attributable common decrease approximately XXXX. $X.XXX adjusted March reported for March of approximately March to net XX, three months compared EBITDA

Moving along to the nine-month results.

income XX, and and months costs. lease revenues stockholders For $X.XX attributable ended which or we net share, $X.XXX included to of transition $XXX,XXX million fully the nine $XXX.X on termination per common of reported March million XXXX, of basic diluted

net [nine months] of and months Overall, share, the this costs or XX, we additional million termination change decrease For lease and $X.XXX approximately X%. of consideration. attributable including common million and transition of to $XX,XXX on basic stockholders less reported an or period $X.XX $X.XXX prior-year revenues contingent million XXXX, of three fully (sic) $XXX.X March of income than ended diluted million comparable represented a in the over per $X.XXX

For the nine net $X.XXX XX, of reported we XXXX, adjusted income months ended to March stockholders common million. attributable

XXXX million attributable net for $XX.XXX the That million For We reported XX, a million. or the nine nine income we $XX.XXX $X.XXX months XX, XX.X%. months ended common of XXXX, stockholders ended to of the million EBITDA March decrease decrease approximately represents ended months of approximately adjusted XXXX. adjusted XX, million from reported With for to nine approximately March the or $X.XXX will the compared to XX.X%. This a March I moderator represents facilitating call to $XX.XXX that, our over Q&A adjusted our EBITDA callers. back turn of of approximately

Operator

[Operator you. Instructions]. Thank

Capital comes with Lake Street Please Mark Our from ahead. first Argento question Markets. go

Mark Argento

Bohn. Hey, Hey, Todd.

drill to about to Can that of quarters wanted out could next down potential of renewals. little kind bit that P&L? of how the impact you couple reprice a kind you the Just on little and a see bit the talk the have what contracts, and playing over

Bohn Crain

Sure. Thanks, Mark.

up. sensitized Without getting precise, the to begun. going has I prices is process are that the market generally dynamics, understands So, think

that in business transactional nature as legacy necessarily is in of target of the for in kind contractual in the contract of forwarding particular business, our question, And just business kind need place US, business, a getting side, we the back with increases the cover them that success of this the kind background we're in And our specifically of with share to having would the kind process way get line brokerage in particular, with be. margins nature. the asking, which of we that periods increases cost good get in through the more business, all not expect that the on working is So, our Mark is but has been the what in familiar the and are and lot of truck people underlying to reminder for and Clipper lion's a who to repricing. increasing some price question of the was our aren't which we've taken

basically, it June, by end So, have of are been the things kind believe will of the process and in is. I of repriced

bit So, this the in quarter have business of ended relative September but of the little we quarter the of Clipper's for of we'll through ended should segment tail to of of the June, kind pricing a the have cleaner business. contract quarter

Mark Argento

And it. then, have attention helpful. know Got you very That's focused something on. are of services more guys I your value-added

those are that up facilities slower albeit the bringing were here, your but utilization Where now in part the some you're underutilized. you the know You capacity utilization, about to of kind are seasonally rates year kind up? ability fill of how of it's that terms feeling online and the I get of had you

Bohn Crain

of been is repositioning in where in our we in area, have took working this a facilities and have So, particular which Mill lot new on. an Lomas kind we acquisition facilities, incremental success with adding in connection Canada, at facility of Creek of that really we had

quarter. effectively would associated characterize in startup those this have you of costs the now as, facilities in are what All did We full. one-time facilities with some, customers onboarding

facilities But the now, should [indiscernible] be this a additional kind quarter of the reflection existing will the contribution seems quarter, the because ended the the Canadian the And but based be there, Canadian customers didn't in and so June, reflect of platform this to instantiating in the the of is evaluating positioned this getting we the platform. incremental there in the on better of fiscal full cost full opportunities we're value-added out facilities. quarter contribution in existing So, of quarter from the services be of incremental and necessarily quarter. freight demand facility

Mark Argento

you but Todd, investments. the and And your implementation. yet I maybe you expenses force terms full know cost and – know you've SAP cycle? is CapEx release a got I sales the to implementation And guys last fully guys don't a that of into in it. is that just got here, out incurred? if Got the quantified are baked or I of haven't Where one, your

Todd Macomber

as we're no, the as Well, goes. capitalizing it far TM

pretty the expensed is that's new sales piece, which bigger forward. the part, working system. accounting of TM The we're TM done. done. piece, basically We've up a bringing But much and the For all that. going through course, That's ECC the force, is that's –

the So, side things. transportation now on we're of management

quarter. each costs those capitalized so, getting are And

Bohn Crain

We I'll a bit. sales sales build by field kind sales. little vertical resources and add, to of to on continue as as have added, folks look well industry Yeah. additional both recently that

headcount organic incremental adding our incrementally dollars, we're in so, functionally sales And resources. investing and growth through

full headcount think things board, year's these – benefit I the folks increase probably side a year-over-year an things contributions of on in as the on to them incremental run basis, But putting relatively contributing a their are are which sales up those most we comparable rate of the on is X costs. we're of don't labor although have points new.

Mark Argento

That's from Good guys. me. luck, Great. it

Bohn Crain

Thank right. you. All

Todd Macomber

Thank you.

Operator

go Seaport next Our question Please Kevin from with Global comes ahead. Sterling Securities.

Kevin Sterling

Thank afternoon, Bohn Todd. you. and Good

Bohn Crain

afternoon. Good

Todd Macomber

Hello.

Kevin Sterling

to Hey, guys say and growth I to I've – first net see just a really expansion. just of you revenue want It's long time. revenue following say, all, this nice been man,

of So, like everything together. it seems kind starting to come is

that. So, congrats on

let [indiscernible] quarter Maybe Bohn, throughout month an shape we and month things us April up? you then trending. maybe month. gradually by ask, are and and the sequentially see So, each how Do me improvement how how did progress quickly take it update May can

Bohn Crain

seems going Kevin. as it we to have into current Yeah. stronger month the to month. is We're precise, building coming progressively each not say fair that we're it getting be get been to and terribly but Thanks,

So, the trajectory. pretty optimistic we're of

in fronts, working. wins. enabling lot making in excited I'm a across There's really comments, from out is maybe customer things in move terms transportation doing fully prepared productivity We're really of a of doing expecting we sound the and in X-Suite here kind of it's The terms improvement the that resources some some and sexy but help out our and on getting that's of back called the contract as that the office value-added to how bundling office we're and settling growth out about back TM on services about progress with own logistics rollout. driving interact that to we're the improvement not with each office quarters with step there's I We're kind partners, our new going here. productivity the really which in of categories. our in think we're operating trading we're we're the We're seeing pointing we even sequential as carriers our of well but of labor of able drive at strategic our transportation things our function payables, and biggest back partners, in scalability out mundane opportunity going both technology some improvement, the consumer office to and specifically that. perhaps, be field. we're And back in excited as

Kevin Sterling

No, I get Bohn. that,

step Let a me you take if that don't mind. further,

some build give see, me, this, lines, to recruit build you to over this you do has Am And believe, ramping of like those also along able hiring additional a I've those producers. this versus platform, As develop competitors. some others you growth? of those it it's big But up of seems this you I've agents. platform, to with going advantage mentioned probably about lines, out, kind I that those as I lines, advantage some agent competitive along just kind see that? able kind to thinking really of competitive got got it's Radiant and to you of kind salespeople know your are

Bohn Crain

Yeah.

think so. I

bringing. and technology with, there's necessarily of is but X-Suite out on do believe easier And and there's profitability that technology lens, at that things facing process absolute SAP business our we're gotten delivering from technology business book business think different of the one we translate in one we're a couldn't the TM lot set really back I of through historically I will suite, – we the of on that going to differentiated operating ourselves all existing that do to able to operating the that's going an a be we ways into to focused that incremental win. both functionalities on I really in office standpoint. basis, the have to and customer are through look be a of our think set make we're we it, we're going that our in enhanced to the partner put that, field. hands of partners And how

Kevin Sterling

the environment. sounds the an out It like the see with reinvest the dynamic to really see kind the this it's point you of sounds – down the opportunity with to great. something getting platform. reinvest grow really up the is seems for hey, something the like you're time big what you're end But road. gearing at know nice a kind my let's now really taking I that, opportunity growth. it with No, freight and and freight of that all to business in Okay. like business is, But, revenue this me of like, day, We and growth in this you doing of opportunities, you're guess, and and there kind

Bohn Crain

Well, good feel forward. kind actually set the proof about think of but The begin ready of going benefits be we our digitization. Absolutely. the the can and to going investment, go, right? to is doing I course, solution getting years so of our a we're making at we're really forward, opportunity and in to and refining word of lot today I in the been results that investments we've our kind of lot here. will literally harvest of work the past And, be digitization, our we're over seems it around several intersection SAP there A

Kevin Sterling

strike right? while Yeah. is iron the hot, Hey,

Bohn Crain

right. That's

Kevin Sterling

So, Bohn, this let most ask growth, we think you, me I of it revenue organic – look – is and you at cross-selling as added opportunities that or is

Bohn Crain

of an That acquisition another We we did agency Sandifer-Valley. conversion we a that indigenous, had was Most Yeah. wasn't organic. but small is some tuck-in And very right? – it tuck-in really small of of did station, incremental.

of scheme small would international business that things. only of in – that relatively was and think the comparable a the I be piece

organic in So, nature. this large, is, its by and

numbers have for looking to been a looking for I – or so, while. And us a think be basis while double-digit people organic on an for at what is able from post to

making kind hit And And so, think about our the But we're to to a we're starting that organic of on drive segue. I office good at to front. we're back growth. the stride little bit excited a in time, it's same terms of continue investments

the take I'll the asked but opportunity. directly, haven't You question

deals As just kind at are we very of out opportunities there, valuations frothy. that M&A very, look size of

our we in other the think than buyback better value because no makes our been there's kind it our deploying marketplace And – there's ourselves about simply not – to at capital, as own to and than stock for more investing able it identify sense we've at so, look us ever own stock makes point. of in this

Kevin Sterling

it No, that. you really following I've a a this second I'll too. and I've growth long double-digit waiting to just time while organic see. been been for to encouraging see is guys

business. So, the refrigerator kind targeting little see of a congrats vertical? the you you're market. that about us Last there. about this to you talked why in question, bit temperature-controlled the opportunity Bohn, Really Talk

Bohn Crain

sure. Yeah,

controlled So, business temperature in its different brokerage acquired And controlled on a about it's – a we our refrigerated Clipper, of again, three of largest environment moving capacity think that areas this the it. long for business. everybody's small And long for where where piece segment before they've space intermodal there's Clipper this benefit, on is ever In so large, is side. business controlled when truck is time, a participated and we and By in trailers temperature focused then, intermodally. tight, small temperature humming really market along. is

to activities, putting capacity space based well the lack do-it-if-it-feels-good. of pulled and product availability. pinch towards under the some more more controlled e-commerce just deserves demand support market temp projected guess we're a as e-commerce out kind more of the of kind future aware, of upon That so, organic of performance take to and space, more I This the temp assets and focused – as on has category – fresh. And of capital going more its as access and drives of the is business growth of opportunity current on controlled temp to be kind whole you off of may in

So, a to we area of specialization. it happens where lot be and have an history

that to to going opportunity. a continue we're refresh little to so, to bit, And fleet in that begin participate

Kevin Sterling

Bohn. to Well, on That's I again this great. growth. see. sense, once organic It's double had. refreshing time for your congrats Makes all and Thanks digit

So, keep it up. care. Take

Bohn Crain

Thank you.

Todd Macomber

Thanks.

Operator

Thank you.

comes Tahoe [ph]. ahead. Our next Ventures Please with question from Jeff Kaufman go

Unidentified Analyst

I a Terrific the back you to couple making investment. come about Congratulations. of guys. were to quarter. Hi, Bohn, points wanted

integrate, as in that winding out look fiscal some at XXXX, I of some know kind terms in capital investment cash thinking you fleet. want door, about more the also dollars. people I'm the the technology and starting what right XXXX you're investment about you on to as but controlled mentioned fiscal least platforms, toward talked the about down reinvestment of investing CapEx temperature you of of just the the You about out the is the but talked you think plan different areas. look making the are that you're in about thinking now, I to

Bohn Crain

Yeah.

up of what fairly have we at probably could million where additional $X million basket Right as So, should we equipment, to identified temp I'll of $X investment. we to closer looking characterized choose. take a we're on something now,

of our wanted tap kind of our that powder is access lease the other lack the that did So, support opportunities. in front we M&A to of it – a or better line, we capacity availability on the just attention to I'll facility be also we $X to fact whether of ABL for necessarily I and restructuring to opportunities, keep other terms dry of full under draw may one not that million reasons term. guess And

to question. in your part So responsive that's

it, platform. CapEx of, the the IT rolled And the kind module, million can international do back-office on gains or integrate plus deployed blueprinting have year the lot then, productivity of and get we're as bucks seems some module back IT, think and of and at a will to get continue singular Or we offices an domestic deploy ongoing of for I our expect everybody achieve additional opportunities that we Clipper we Canada. a and I we rate to side, be still more of we run X the headed. kind There's call that's good out. be of of broadly would where further to current investment minus a tech/technology Wheels to On as inclusive

$X through good within we But back-office that a migration we'll some our a within objectives. in try of those slow to million going well So, and platform. singular as as see we're of steady live in goals get trying number opportunity the and terms a and of at opportunities to CapEx means, to try pursuit so speak, we're to to live a to

Unidentified Analyst

Clipper fleet? temperature many controlled how the Roughly units are in

Bohn Crain

believe I now. right XXX it's around

Unidentified Analyst

were about as margin dollar you incremental going the question, this And way to think okay. so talking be, you're back-office going to to cost incremental it do at the Should with going integration. not business or that a Okay, then we system it's benefits are about as the savings is, seeing a forward? final better better show contribution up be much you

Bohn Crain

I it's both. actually Well, think

been little little their let singular of and IT when bandwidth SBA historical we SBA synergies. some it pull cost we've back-office and Historically, a to So, me a and a I freight little when networks, didn't capture to able enough we – set all and justice legacy need to to the bit. And the centralize of sunset have got question. the again, we've operations. on immediately But retire apart context acquired this transaction, stations onboard our forwarding platform in agent-based do the processes standardize to to other is provide a

SBA So, ongoing we're management the in minus plus still carrying on a system. cost proverbial $X transportation kind keeping million of for year lights or the of

to as And million the another be able there at, SBA cost dollars just over from enablement. so, to associated SAP get of that able get TM, synergies we're to converted stations that is we'll

efficient of the and per our kind more transactions And office. of there's able to in of of here drive transaction cents unit then, processing events kind in of being dollars reduced and kind So, cost that other and kind piece. back broader, the there's

Unidentified Analyst

And you. Todd, thank solid Bohn, Okay. on congratulations a quarter. third

Bohn Crain

you. right. All Thank

Todd Macomber

Jeff. Thanks,

Operator

closing like comments. now to Thank floor you. over the Bohn turn to for would back I

Bohn Crain

All right. you. Thank

very Radiant. remain created here saying with progress have remain growth on bullish platform we prospects we Let we of and model. very that and excited scalability And non-asset-based at the our the me close business by our

forwarding XX-year consolidation in consolidating unique believe support strategy in in to We us puts our networks, advantage and first-to-market on balance continue technology infrastructure people position world-class to our invest and investment we technology freight and opportunity forward. out a ongoing perpetual longer-term in much now Our in agent-based low executing leverage multi-brand the our marketplace. sheet further and with this enterprise eye most and larger back-office represents towards an support building scalable to a going our a

We are patiently and this vision, listening to persistent Thanks we end value will meaningful shareholders, of operating Radiant serve. customers in of our your which Logistics. support deliver we our pursuit our time, the long-term for over and believe, partners that

Operator

you participation. for This concludes Thank teleconference. today's your

You may this at lines time. disconnect your

Radiant Logistics (RLGT) 9 May 182018 Q3 Earnings call transcript