Saia (SAIA) 28 Jul 232023 Q2 Earnings call transcript

Company Profile

Participants

Doug Col	EVP & CFO
Fritz Holzgrefe	President & CEO
Jack Atkins	Stephens
Amit Mehrotra	Deutsche Bank
Chris Wetherbee	Citigroup
Thomas Wadewitz	UBS
James Mulligan	Wells Fargo
Jordan Alliger	Goldman Sachs
Ken Hoexter	Bank of America
Jonathan Chappell	Everycore ISI
Eric Morgan	Barclays
Jason Seidl	TD Cowen
Ravi Shanker	Morgan Stanley
Bascome Majors	Susquehanna
Stephanie Moore	Jefferies
Bruce Chan	Stifel
Chris Kuhn	Benchmark
Tyler Brown	Raymond James

Call transcript

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Operator

Hello, my name is Chris, and I’ll be your conference operator today. At this time, I would like to welcome everyone to Q2 2023 Saia Inc. Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. Instructions]. [Operator

Col, and Doug Financial Vice Executive you. Chief President Officer. Thank

begin. may You

Doug Col

Saia's Executive Chris. to me call. are Welcome morning, for and second call Thanks, everyone. conference Saia's Good Fritz Officer, Holzgrefe. quarter XXXX today’s President Chief With

during of you some may XXXX. within meaning that statements Securities Private call, of we Before we the know Litigation this begin, the should make forward-looking Reform Act

cause to all on historical We results statements differ. press and may other number subject this facts the filings SEC actual that forward-looking might results made and more statements release and These be refer to risks information exact not call are are actual could our uncertainties, on a of factors that risk our for you and to materially. differ that

the Fritz opening I'll for over now to some turn comments. call

Fritz Holzgrefe

thank Good for second to quarter discuss us Saia's joining morning. results. And you

declines continuing While last what softer environment, volume a XXXX. comparisons, played On our present I'm against through easing role to by quarter produced positive of July. moderated team so proud in believe in is results month year-over-year ongoing dynamics move through as of have the actually quarter far pace the We industry to changing bright manage turned note several solid second the we weeks in and view over have economic each this. I an very a

our monitor we customer Internally, a satisfaction on basis. metrics daily

in of results. well as the years. to couple financial to favorably, our continue our customers increasingly in as the For both commitment our trends team's gratifying opened is the new our as progress in reflected see satisfied are quarter the legacy It facilities, facilities last with service

only XX%. year solid the X.X% compared revenue, compared down shipments quarter. nearly an X.X% revenue despite quarter fuel to in down down a to $XXX.X of the environment the Despite million year's last surcharge second we was being fray record saw prior Total revenue fewer results overall and

pricing improved haul. mix yield, been the key and of weight service, in revenue offsetting and last and on these X.X%, an created headwind of year in with has increase by to to Our length decline focus a surcharge our per shipment, factors compared fuel by business excluding even

importance resilient increase freight closely the We from revenue metric mix for increase benefiting a average we highlight fuel surcharge selectivity X.X% shipment. business team. quarter shipment in face second pricing of and A in and per monitor revenue excluding weight the continue X.X% negative trends, our our In by saw the of increased of to shipment. be per X.X% continues quarter. renewal per contractual average in Industry and tonnage to the an key

quarter second record deteriorated in meaningfully quarter since posted then. basis a ratio our But the operating points again, revenue for industrial of has and OR year. that operating both XXX XX.X% and the was ratio second of XX.X% last to quarter economy compared Our changed

I'll the call our for second results. more turn details now Doug quarter over to from

Doug Col

Thanks, Fritz.

surcharge surcharge increased revenue shipment of to in revenue while XX.X% decreased by was to XX.X% by by X.X%, Fuel the fuel yield a Revenue X.X% ex-fuel to ago. $XX.X compared $XXX.X surcharge million. including decreased quarter decreased quarter improved fuel XX.X% revenue excluding $XXX.X Yield Second per compared XXXX. to X.X%, year total surcharge. $XXX.X million of the by second and

increase X.X% X.X% per to attributable a Tonnage shipment slightly shipment. in weight our X.X% average declined, decreased offset by

XXX haul of length decreased miles. Our X%

of XXXX approximately of network grown our having over side our our wages the from July key expansion headcount the for the a wage a combination benefits averaged employee year-over-year Salaries, items and XX and months. expense last X.X% across Shifting also to which employee by increase, increased to our X.X% X.X% in base, few quarter. result support

was second X.X% and the quarter revenue our XX.X% rail combined and compared XX.X% by XX.X% of linehaul the compared quarter Purchase XXXX. XX.X% total decreased in to transportation miles expense of in were to last transportation second XXXX. miles Truck in compared the total purchase year, quarter, to of quarter of second the

XX.X% increasing in X.X% miles average basis. the by Fuel diesel by The quarter, a was on despite national expense expense the of in fuel prices of XX% decreased over company decrease result decreasing primarily year-over-year. year-over-year

to the of quarter tractors Claims related $XX.X up the in and terminals, or on of development by older reflects expense year-over-year was expense million quarter XXXX. year-over-year, $X.X combination increased XX.X% Depreciation expense the to million the due claims. some and The sequentially first and premium of of insurance was trailers. cost inflation acquisition XX.X% higher primarily from in increase it quarter a XX.X%,

the total in with year-over-year X.X% X.X%. revenue the by Our operating decrease of expenses and quarter decreased

to ratio deteriorated operating ago. XX.X% to compared Our year XX.X% an a

Our a XX.X%, tax year per diluted our earnings for last ago. quarter the second rate quarter $X.XX to second compared in to compared the the in $X.XX was and year, second XX.X% quarter were share

for call Fritz closing turn to some the now over I'll back comments.

Fritz Holzgrefe

Thanks, Doug.

last OR mid-XXs. the below over testament with to point, last with results, I'm improved our cycle So this our in To low performance half an At a is the to the half of first operating first year’s few years. freight results. operate team very overall, pleased financial the

focus tangible is yielding employees. our organization, Our customer rallying customer our first for the across a singular focus on results point is a

we engagement As reflected completed record with survey in recently. employee the

is the year. far. so With same four the the time, to key by the to to to the give a their on five workforce the around more new customers and our plus excited terminals LTL XX the continue At them opportunity opened the three we're value needs chance share develop the grow. other we of customer we've years. of markets end Saia proposition often. managed component last our continues to the choose the track open and This for two year, terminals more engaged closer market about to to A we've talent over I'm

see we of locations, considerable excited we're runway continue markets. about those Although penetrate these to success to the early

in into us. Keep key beyond. of carries While allows organic a benefit our us at the us pace mind and go strategies XXXX terminal expansion to our suits that that it well pipeline for openings

on subject opportunity cyclicality to terminal where are accelerate and we depending the cycle, is cycle see expansion in our to down business activity. Our slow or an even may we

we organic opportunities on expansions to quickly have execute Importantly, the available. our as positioned become company

Finally, importance the the control. before At uncertainty the That half the focusing heightened customer we opening beyond. we call for lot current the second the in of would on around well industry and economy can the I questions, documented there's is and of emphasize the Saia, that through a uncertainty for LTL things still we've strength disruption. faced in say

Great industry share disruption conviction employees, adapts coming service Saia and evolving about a the current industry. this growing economic to key in long-term to term environment over great as adjusts all long to gainer the remain at the as the our prospects So months, a footprint, and securing my our steadfast. position

now we're line that for open operator. said With to questions, ready the

Operator

Instructions] is [Operator from Stephens. first The question with Jack Atkins

Your line is open.

Jack Atkins

morning, Good thanks great. questions, my and guys. taking Okay,

I going is that guess maybe the imagine July Doug, different if the obvious last XX a to I or trends, if on and appreciate -- we you would days. ask So Fritz. really month half I obviously, the week What the of first tonnage want one. over been But, know to shipment seeing I'm get little than to don't what you've take could update

that quantify So bit. could a you maybe if

well. I think that'd helpful be as

Doug Col

Sure, Jack.

summer congrats on First your of all, activities.

Jack Atkins

Thanks. Thanks.

be to glad So married.

Doug Col

Happy for you.

you June, June out have we guys numbers, So April early that in press put May the release.

numbers, our tonnage the year-over-year, was June X.X% So, down shipments were while down X.X%.

per by dipped X.X%. in So June shipment weight

course shipments customers lighter some I'd say seen that over the of started into weighted some were probably we already mid-June some newer we and flow seeing well. So the some some the of freight as from year network activities of working on the of that,

of continued per here weight kind June, July trend that in in terms its of shipments lighter start So in weight. and

is shipments So X% month down, makes up weight about out Again, July, are average trended what's that tonnage yesterday, per versus today shipments it up X.X%. there. sense for going on to but about us through and

Jack Atkins

critically high from last differ Saia just the Fritz how With important value trends, the can versus in to broadly, then of and sort my this marketplace guess, you really you've service, weeks, that I it's make the any follow team the of are for today And picture proposition. that story been disruption of walk thinking all to as levels up you're maybe trying month it. of in Got what week, bigger the you seeing, that from how terms and kind about does network your sure last in the protecting and couple of this? question, maintaining through us you're disruption

Fritz Holzgrefe

questions. to was What sort of before the first good recall. is July July is X, that of that say right hanging Monday a holiday the -- fourth, would Yes, I

day. shipment a lighter bit perspective challenging So cost that was such. and a a was a little it bit from of And

every of week And I was weeks. And more first impacted. favorably so that But sort two trend we've holiday you is last July year. of levels seen business the that the in think know,

been we're far July. So what seeing results contributor a our so the that's -- a positive I big to it's trend, been if in think in

with the managing we're our sure understand we on is that or requirements are, thing the making and execute key -- on think is work the our focus economics up, service significantly, I But for freight, we the customer the this. what us what customer up sure to managing make freight base picking what levels, that picking and maintaining it can that

feel we very service strongly offering. that So tremendous a got we've

it also And service. for to critical critical us maintain So to level compensated that that that it's appropriately make high to service of is to offering. we're us sure

well, we'll that weeks the Customers, think the get strategy. level time, what of in lead the share this I in a this, term couple But think this And see that, customers, or is will time, that can we and next There's with kind on focus disruptive through a the us if number Saia. we of is service. long hang is that over in will to customer show unique really could first weeks. our us high helped out. us is this. been going differentiated that's we accelerate last that it to change bit. And on And lot come execute we here to of a disruption can plays of opportunity, a maybe our on still this how you But here

Jack Atkins

Okay. Thanks, it pass on. guys. I'll

Operator

Deutsche is with question Amit Mehrotra next The Bank. from

is Your open. line

Amit Mehrotra

I'll talk you've that guys volume, a the XQ ask a third but have increase just in XQ? obviously Doug, on maybe so the from guess I maybe wage know I ratio, just momentum on you Doug. can the Hi, a to Fritz. operating lot about move XQ, got some if one quick line, -- as Hi, we hold in probably Thanks. you quarter expectation which

you opportunity that know to of quarter. talked about that so you at accelerate guys what's overall the yellow, the what the an business, think contract you of renewals, and book to just the opportunity And peers like bill as happening gives on then Fritz, existing on this pricing you've kind price been to what of I of is the last focused see does X% the of narrowing revenue business? But, rate per trying so book

Doug Col

Sure, I'll Amit. take that first

know, yes, of our we So like is and increases time wage things annually kind you you're right, that. about, July think

things on X.X% doesn't So took that around work quarter. improve the still unique the big I'm unique opportunity kind saying right QX years, all, was a that's you saw the to last place, half, there's QX step taken out mean, just if quarter. opportunity we’ve back I XXXX And take in COVID there, still to some the and year to things sense. about really assets up we was each average got out workforce. a grinding a historically, pretty the of and XXXX call as we're there, five it really we'll that a make tear around But an and across

kind like bps look But quarters, something if usually the at I of deterioration. meant it's other a mid-XXX

be to month So look, a one our line, But our over got XXX month, points solid the Fritz we pretty with top and on said, lot view, basis XXX QX belt, would I under next QX work. like a certainly uncertainty to in the weeks. of think, few

I like belt, month we're what that's comfortable our we're So, than in with. said, less a

Fritz Holzgrefe

Yes, environment. Amit answer regarding just your to question pricing

price that competitor think low under market, a current the sort that. if, the of I think if I disruption, exit you have

naturally, is service because that thing think that I customers expectations, gravitate first job. Saia, would around, customers a great think doing The have we're the gets shifted towards I is

make -- level doubles sure that paid For us, it capturing our of to those down responsibility for service, we're our charges. frankly that high

I a -- think the it's for because value lot gets that. customer of

So that. very, we've diligent got to be around very

that the seen the that over across the industry? I probably think what discipline continue. in I time mean, happen could you've space, will I think

in that think that paid I all costs business think factors to that to not inflationary, it operators, still the Saia, remain key for can underlying are just be those I this those for extent the service think look sure level. getting gap as the of the to we paid investments. continue we're or And make market to at because I it's, ways to above close market,

opportunity disruption, that that an think that's maybe the that's continue got drive. services. push great with this Or think that experience I have forward us to I to with helps opportunity the people environment now, to will there we've

Amit Mehrotra

to frame over are Yes. follow company opportunity to the stock, obviously, a the And a you four, been guys of last so you crystallize think to are great. from responded I guess five new you the up, bit the to Saia perspective, very company, little lot, Fritz, the today, of you perspective, equity can to just big What years, new that runway, has that has And but a you would the performance value opportunity guys. as If revenue about kind accordingly. margin people because five-year like is? terms the you the in you three, new a the of of fundamental where us there kind hoping have help just be the new from of -- picture kind performance because accomplished talking

Fritz Holzgrefe

our now, through with if I what over accomplishment market And we a bit for little a couple you a a that's slower you a and I I of cycle opportunities and performance that right economic maybe now, industry Saia our think bit studies of years, best-in-class sort at for think is sort look looks last study at XXs, look significant. progress significant where in Saia freight the operate to of of part the margin growth. the opportunity in like, and we're think are more and or able executional see the you somebody low

I think within is the OR this opportunity business something it's meaningful. XXs for Saia into reach. the to I mean, well grow our

this the what those and is, understand when that the got from mid-XXs the customers better, I pricing And talk that is taking all to any opportunity. industry. we time, critical story that getting customer, they the of they get that about what What’s need customers mean, about Saia. it's care value this helps our we're I versus that get don't see us players helps mean And to our pricing impediment gap or close I larger about us into the in excited that OR

Doug Col

I Hey, Amit. bring And to note.

know you're Just usually this QX QX, everybody clear, that that you close we I deteriorates just a to call But because increase what of loop, the little to because the bit and I asking. know of be primarily discussed. for know wage are on

to XXX said in to basis QX, So points when degradation that's QX I OR. XXX a

get So, thanks Amit. to got the We one. on next to

Amit Mehrotra

you. Bye-bye. thank Yes,

Operator

from is question next Wetherbee The Citi. Chris with

Your is line open.

Chris Wetherbee

you're a of rate like July, making granular. more acceleration somewhere maybe saw shipment could you Good that get comment if Thanks. little up guys. the seems It just bit about run just looking to pick to of what with the X,XXX Maybe a the the want of on like? you morning, that in you level, of inflection just maybe to was exit of market day here sense per sense wanted might in be the a shipments get type so that of a the rate get can what July, sort month X,XXX month

Doug Col

of it's the And of little really down from couple the a should of better, last this be different June got a was you've normally last But, into it week then a parse been and mean, of than we news. I hard out going July. month. see and it's month to said, July. obviously, Fritz Like seasonally, everything step hasn't looks and some there case the out the first weeks that on weeks freight of But, lot couple bit the us coming

in full early a say up. can been it's month anymore to So, we have we'll care on trends it. probably get step the to wait meaningful to September really before But

Chris Wetherbee

if sense available, you guess, helpful. to the look obviously I openings, And of can the when think a year, that maybe plans maybe specific out opportunity Do could that you of us what that's about plans some you a what for from standpoint? give the Okay, your are are? And can run and be you XQ assets you then footprint through? back potential facility half have the be into expansion

Fritz Holzgrefe

early of Two to year. a opportunity the to I it's to will of ones little the available what us opening Yes, months. few be. that the the last the that four on make four, you big balance call of These became three three bit the color, to those real give in were were could

a assets them, about feel really system. environment that get is become fluid facilities, into purchase them closed ability good available. our to the this pretty and where we're So our in identify We

it, So on move I network those more to I we can were into our and opportunities quickly. pretty can those if pretty available, opportunities think integrate become quickly, think we

would if will, estate half system, I assets. get a year that an influx the in next year real into were if year of available wouldn't this became the there of second suspect, likely turned probably you the into

of just maybe say, whatever is assets of look become access challenges, be. may something seller other to through may would thing number a administrative because simply we that going we market or longer transition, may the our you pause that opportunities the that or piece map, to challenges going to it's will, there we it location have that, might take sooner have available, of well, us to if and kind property or pipeline of want out into to the pins get an is as switch a of us we forward, else have but a on we I opportunity, we identified And that if gets point that at new

But ability to I getting us. line And what's out of take think in to the is identifying a pretty this opening around facilities core have to and for operate we that competency away them, important service. culture quickly pretty well. that That's Saia

Chris Wetherbee

Thank appreciate helpful. you, it. that's Okay,

Operator

UBS. question next The with from is Wadewitz Thomas

open. Your is line

Thomas Wadewitz

through get the morning, some wanted we transition little flow to a how to think brokers? place? Good through could it's to Do kind covered kind Yes. that freight flow you on important could show in it's you be and Fritz, see but think service and takes you you the really shipments, time? perspective it's you -- the offer in Or lock this bit these then like, this more maybe over what if of then think of you you if quickly, its got And can disruption do again? shift with could sticky of around they'll price a bit up and

to? piece the the guess service, can was within service you it this price less that want of other is less freight, you sensitive just know, work? think I you that assumption where assume if sensitive. yellow been get, have can I Or would we that freight you the does how kind know, you is, is

guess freight So, couple a think trying but in coming to about freight? that just the understand quality process you of I that's how of elements, and the

Fritz Holzgrefe

think have of accounts the quarter, flux or freight LTL because, providers of that kind bit that today displace have we're for certainly, our that plays this is that mix. approved a there so several of revenue are listen, -- and thinking in the we're what still of the balance disruption Yes, could there there’s out, we I as there be that earlier mentioned we about little view

show service that us pickup opportunity. business. keep -- that So and have an some it that customer distributed of of And others. exits, sell you economies business to some and one to gets own that and providers certainly around that's to opportunity if Provide for and the freight

maybe There're So, the stays to that that that three that fair are also and that a those has brokerage PLs with business gone certainly something us, make amount of for those us. possible. through sort of opportunities, extent sense that's

the for this sort us of time, in that -- is So for most this it's and makes Saia. freight that important to really sense find

that that profitability, I find not will the we And to pick the market to think over would market our do think historical it what as that if to sense, that to we're charges we're time, keep think if we rate see And you volume, drive think in And that and time. sure that. we make I if to focus. we it And returns. that we'll makes in over adjustments up the works, be we get is we'll I or chase benefits that make are all freight, need us required, think

Thomas Wadewitz

Right.

of okay, then this a balance I debt, that. lot I attractive and Okay. would That's on to of from really kind seems what kind you in to you're ‘XX, it program cash. pretty a you have you generation a this, allows? ‘XX, very not Or on guess how just I'm little of terminals, aggressive you you sheet terms the your perspective, gas got be, being necessarily debt despite would that opportunistic in wondering issuing CapEx like And ‘XX? be consider for further they're terminals And second and the strong bunch a appreciate cash maybe question ramping having beyond hit we got if strong said, of up year. go of well, could

Fritz Holzgrefe

grow, you balance right. mean, it's great I to point sheet a is positioned listen, Tom, this up. bring

sufficient if have we that cash, will, you we growth we've of position is to fair they provide generated we idea that So with amount see us cash if now. accelerate a our The right powder, opportunity.

certainly that. enough So it perhaps if that opportunity we'd consider the attractive leverage, warranted was

that have match supplement to equipment fleet that same to now really able we but the our build able and generation, to what also that real we'd to find an have out at be facilities, with generating we've we're fund cash, right that eye have frankly, we is not our and of found only to But time, growth. to the estate purchase, we'd been facilities cash the

Thomas Wadewitz

the Seems well Thanks for really great. Yes, Okay. positioned. like you're time.

Operator

is The next from question open. is Fargo, line James Wells with your Mulligan

James Mulligan

morning. guys, Hey, good

we part idea the also, sort that of go versus much sort just think from market like the out. of of that past of of cyclical weaker you volume it there a of share yellow. source its source have actually grow that might bit, of will share that we of Any there as Just decade or competitors, have with sort do the modal half about of more wanted call given of of it, over essentially sort other volume And sort think LTL been be Or like impressive talk driven what trends, sort to think a you'd share reallocation past sort some in bit, as or share? growth the sort and of of little sort been its of of a where then how still environment will to little at of opportunities through an growth rate? can continue slow to this

Doug Col

starting terms those we've starting and environment to we've certainly a different this in terms seen we're to of traction Remember, we customers of that years, middle I some the we gaining focus landscape, mean, XX Yes, three there's we've markets of current new some we've fuels the Doug. foothold. we're last The competitive and verticals, on. selling think get where materialize terminals opportunities this that in it's, had we're and no in some pickup question. year initiatives internal think and opened in got Saia

months, terms green couple over any of economic starting of to last we some underlying and of initiatives spots cyclicality the to shoots, seeing But like volume industrial offset of in the the and seeing we the on haven't our are you think economy. some we're were we'd fuel bright of mentioned. been out calling kind backdrop, So, that

decade and stands supply shipments. and over trends the over in think of what terms of mean more that moves nearshoring of the Now, bodes play beyond, well. LTL LTL smaller, really think about benefit think you might as We going with that Mexico how positioned? forward, We chain to more border is and next cross some the Canada LTL we frequent think and and even role and

residential final is to activities. the mile to of growth We positioned benefit think LTL continue and from deliveries well

have consumers instead more things retail, comfortable and As more online bricks and of gotten example. ordering visiting for mortar

weighted and parcel beyond those a of heavier Some do. carrier can things are what

in ends up that. a LTL So playing role

immediate positioned specularly terms we're of So, any the economic calling weren't out I think of shoots. well kind But in backdrop, green participate. we to

Fritz Holzgrefe

add year, in to relative if space, you've in Doug's a our of comments, our some position probably significant of think performance, our seen peers going outperform perspective. a momentum, success. will that last services the and a differentiated I peers And in you rest at think what is and quarters think been think our from part that our where shipments I we versus the looked of to performance we've the our I I -- or drive forward the tonnage

So that's I as distinction well. an important think

James Mulligan

Got you. it. Thank

Operator

question your Jordan next Alliger, from is is The open. Goldman Sachs, with line

Jordan Alliger

how it as even in I give was through quarter I we volume? a the feels of question. if could looked questions. guess for that up would That first maybe July, be you and One, wondering couple ex-fuel step maybe especially some in sense how with move yield the your

Doug Col

that. of negative we in there came a terms now, way shipment. right Yes, And per it into and yield, procurement the down, mean, that's tailwind in the a call July like it's seeing on down, later started here weight was shipment kind to of as June, I revenue a per positive coming

And of into So also we but be mix and properly yield. lot have could flow things and it to direction that is But keep geography an concentrated. rates that and we're getting weight moving that on of be of and of haul, so a also length related. much sure can that eye yield make

I is what contractual renewals up No, we're as are But bringing as is like our to pricing said, environment, the and that's about Fritz And running? much the think positive. what bottom line. good. GRI we the is are yield mean, that's And the remain but as pricing

we've trend you for to to July, like quarter, per you yes, weight in helps example. that seen that So continues in say I'd yield. reported watch negative If that got shipment, the

Jordan Alliger

a And up. chance I it question curious just on can a to XQ but it this as potentially then, of prices, price, away. some do certain step second on the to goes degradation of floor uplifting at sort amount of to the mentioned for OR least work, given maybe there's would better what I is, volume XQ, make there's think sort you potentially kind imagine normal And decent competitor

So Thanks. variability or curious, your on that normal around the thoughts trajectory?

Fritz Holzgrefe

That's a point. it. Got fair

probably perspective place, of that. pretty But beat mix, that would continue the right to beat trends, an early I I line. in manage this. I our I think good and execution, certainly, there's we into one we feel to can pretty tonnage that, continue certainly mean, we're costs there's we core the shipments path think things kind a keep our in if our that we in keep could, opportunity, I of

or are. On it's we've is up value of pick significant customers we from what customers a proposition pricing is the and they disruption, of a of the level with, that is service business new profitability other that any looks match of understanding That's perspective. we what those pretty about, be that mix our it that and freight real that relative hand, what sort to what means the period because careful to like, got

go it's And So, think we not, possibility a there's -- to yes, I got can we it. it. execute but still beat

Operator

of from America. The Ken Bank next Hoexter question is with

Your line is open.

Ken Hoexter

Do five centers about Doug. And congrats kind XX% just you maybe excess morning, results and the after service capacity that like have grow Hey, great. great talk working on at of here. looking process feel here? to adding and and is through this Fritz still ability more, Good capacity the you

Doug Col

in. early, apologies know Hexter and We Fritz in weren't so chance get pronunciation. some all you its I but that quick a on to didn't get the queue backlog Real

Ken Hoexter

I've heard sides. Okay, all different

Doug Col

got we because of last where some that's there sort what's got think network, we about network some capacity open facilities in lower now, focus -- levels, and around think important that they of All the all XX% right buddy, we've a on at maturity, XX% capacity be two know to are that me. have across it right. I If of Ken we entire and years, in capacity. probably I we there, might there the

so great a that continue to differentiate opportunity the and to us. find to facilities there we've just new for in right to in fully that And in. invested for utilize us that customer, opportunity that's got us So -- now that's we've for place a market the

it's we've those facilities those the assets in investments some are this will place the areas And where network, larger utilizing even full utilization, upgrade approaching in fully year. got in of we're that

good pretty the which disrupted a unlike that we the come what from. is like going about last know in where are, over experienced this this, to years, freight challenge, always don't is feel environment several we the and So, where is you not we've

might and capacity that's if bunch. So an give average say, to places, in the other And know, freight. get you some what, across sales going places I the manage we you that network number, go we're capacity have a will and

Ken Hoexter

versus needs know, some that an how want don’t how which earlier follow assigned and then experience, and So, away, settle base? does this I question, take up away distributed. guess your from multi-year talk the maybe on pricing you really to how is, because quick about long contracts freight right gets I really move right that I much chaos to business to and in business there's assigned in, be can gets it Maybe right,

Fritz Holzgrefe

this mean, pricing -- one-year large, of a book, sort they're everybody's some existing agreement. and obviously customers, of I in on our Yes, everybody and by

pricing I attractive So about have or that's account, but business the place we that to up that customer. an that revenue account not maybe on percentage got of we that the we feel sure pick we the think the the larger to pricing didn't because make in earlier it, the may was good had we've have as

they our shift it. satisfied we're the that's with us, they're Now to pricing, freight move it's, the and

What handling, with a make sure you probably other characteristics up customer or the customer a are looks with we've new type the look freight the or we've the little done business that's other, customer the maybe then more got account customer, those the piece, to So, you what ones keep the opened to freight, is new national business, you're like and on but lanes understand the an eye that that what like? like.

term. And case, out differently that the try in short that to in might manage you or manage it

think -- settling through process it's see but fair industry kind you'll a of I competitors other say it's, the several I'd to through know amount a churn, weeks. as and the I I disruption, goes us, of moves go around think over or movement next So don't you around freight if a this the

Ken Hoexter

Great. Thanks guys. the Appreciate. time for

Operator

with line from Jon Chappell ISI, open. your Evercore is question next The is

Jonathan Chappell

the of question is in the most lot of over in of to morning. going terminals? the across locations. thought running to this a Does of previous on the mix completely good network. kind would marking that the a been different was market being ramp haven't And of profitability you. what's answer And of Or process Thank geographic And different there time, at on for you entirety them new they terminals Fritz, that. the there's market freight? the your about the dependent capacity today of accelerate new the the these the been it profitability brought on, that

Fritz Holzgrefe

it network helps to We’ll the that, pace business things. the leveraging grow of drive it home sorts the accelerated line, investments, building is this say us our pickup density now matter that but on those the or is more fact opportunity that is, dependent around economies, both, all right those

managed So will us. additional a well adder yes, here potentially is the for growth

Jonathan Chappell

then imagine about last over you equipment, you and happening expansion been going but and some a with and resourcing, terminal et how that's about, flex of the has one, How weeks for think the above what's you're the shipments, are permanent been be lot. time. work of that just been whether the headcount beyond, you're kind know, the cetera. on investing term, get radar Okay, thinking long around disruption as couple to acceleration mixing as term I'd short PT thrown my this you of you second the more

Fritz Holzgrefe

costs an feel us. up our the this requirements comfortable need good PT important, to, is fluxing linehaul think our meet We it's to So where customers. and I of is service advantage our that we as our pretty ability very for manage down to and

you follow declines in as QX many we could, period. If miles couple you you the -- of we saw as recall volume QX QX quarters, insource last into over us saw as us the if the sort of

as have more haul able And back a kind you line you've growth network. now, that out scale to you ramp to to got you've as of the means we rates growth markets, in drivers add now that because drivers. have and the you at scale markets, to drivers you if these that that new utilize than of we're mode, with opportunity the add got be And fully these

that's good. So

our But make cost going with it's feel service, part utilizing flex sense in more of adding the meet those it's two got we our put be to effective. and own customer And need expectations. that of to up. but we to supplement And those to where meeting our we'll is with -- we're purchase got things pretty good to the key partners, we transportation together, model drivers. And interim, ability continue to that to

Jonathan Chappell

it? Thank you, Fritz. Got

Operator

The Eric Morgan with your is next Barclays, from is question line open.

Eric Morgan

morning. on Thanks to question. the wanted I to for pricing peer group. comment taking Hey, good your come back my closing the to gap

faster of the really steady dust saying can big have Or how right to a for going of to a near over disruption approach thought more curious, than that to not otherwise? is be settles? you time? a you term Just some parity might You anything kind on it catalyst be get know, that focus opportunity? is this or Is now? And going of there an as

Fritz Holzgrefe

that listen, daily service the paid daily get a basis. we a our for customers we think we about on Well, a And about service that provide on as basis. think result, to we that making sure

closely, we're Now, higher have expansion service our our that's that levels really of about which customer. adding know is organic providing providing if on, to we you're terminals we us greater, going following

that those it. you the for you delivery When Moving that have paid making are to to times. hitting transit do points that opportunity customer times get to customer, in the we're important the and providing those pickup and their closer touch all

And become to We competition. average their we like parity we closer revenue national levels, our to And what the grow, at we continue what know with we larger and looks is. per look bill peers. closer service as see our it

to So proposition us gap the of that's that value what the part for is continue to of opportunity drive we're it's critical. doing. And closing

that. I that on -- expect down would peers I environment, that we'll also will effort. So do if anything, this would would expect our double

with quarters, even I the continue seen And around as around environment important. competitive what set think We've in things down. will discipline and the pricing, here think last I seen number we've slowed the of that's have the

Operator

The TD Cowen, Jason line question your Seidl with is is from next open.

Jason Seidl

include to assuming a is assumption, OR Doug, you degradation. that OR up understood XXX basis more are sequential that that's a basis, see the I Hey, you Hey, to Doug. that's on or points yellow from That sure the XXX you're Fritz. thank you, of make wanted what operator. I you guys typical the Hey, about does what said with coming freight if bankruptcy?

Doug Col

pretty It's typical.

average, like out. I you want if things You start back a said, you know, to taking couple you got go and an of

So that's tried do. what I to

COVID where on but, actually, and of seen, do clarity we can we've think seen just it's But, this just I what words, have if very a that. based XXX been think what math on says weeks, in take few it off ‘XX. we goes in can on the the little we we we've based XXX July, year to next you over

to XXX basis points So maybe XXX sense. makes

kind I is been average, driver increase the like average starting has -- few haven't little place, a it's we of we mean, we couple out driven because Again, take things. bonuses. better I said, wage we math maybe to a some a used But but hiring that in we're historical know quarters. use than our in the

what factoring date XXX now is in So XXX think know basis to in we points we month July doable.

happens is not us. clear You to know, still on revenue given what

Jason Seidl

borne of the that this on And case? based follow pushing the they issue the any appreciate on the carriers clarification. up fruits with that negotiations were thought Was back? pricing. customers an with yellow. be LTL in that push of on I off sort We has there were June well, the some back hearing And could fact Okay,

Fritz Holzgrefe

we We is don't our know this haven't get may view to anecdotes of know But that. got in the weren't capacity. seen their of to pushing sure secure negotiated back. pricing mean, I of I there get for saw sense were we out anything And we that and disruption, opportunities. all some that some and were made certainly those like there. that the that the be looking place. listen, we that I that making that there we've extent we're was to customers anything us, part it maybe

Jason Seidl

sense. make Okay, as always, Appreciate gentlemen. the time

Operator

The your line Stanley, with open. next Ravi is question is Morgan Shanker, from

Ravi Shanker

business? your and Doug potentially after And for opportunity obviously, are But staying players right to this everyone's are settle pricing everybody. in a for aggressively maybe it jump who do sort disciplined going fairly of like obviously, waiting Thanks, any returns. seeing think you you everyone. in? Or got other this Fritz, of on space now, ball the business you fairly pretty large is kind

Fritz Holzgrefe

is fundamental this the providers, the not have appropriate LTL the inflationary for early in market, think positioned I I out is for return where you I don't on all does And get business. generate is you're it. you you. out. would a of tell pricing volume on innings thing unless regardless an incremental one that I there But think things we're Yes, how call probably still shake

think industry it's as lot sort the around how And because that. discipline think a underlying I basis out you of seen volumes see last of business. we've of has the played the few quarters, declined, of have over I

I anticipate led you volume chase, will. any don't of if sort price So

Ravi Shanker

telling you when pure looking inventory as Can you in seeing too for? maybe the I core customers not kind goalposts, going do are business like us much you're to it. now terms Got be just think switching cycle and some What talking driven cycle, think in of level, you gears out of just about well? your of are cyclical And what that you the terms of kind grows improvement. of you give there guys hinted kind

Fritz Holzgrefe

our that Well, kind last the competitive I this in been we differentiation. business of own sort our before of have few growth underlying has weeks, think

So that's positive. I think been

GDP for. I look, we we that's think at know, year, now. that green second that I folks are I the sort the the are looking that favorable macro probably as probably the I numbers the half if you shoots of see look indicators in And as think out of think think right that's developed there, more

a that. environment one a particularly anything more of anything I set, don't of is we I think that hear our new, don't temperate environment. other it's way or recessionary customer think sort like or the

a of think the I versus were. it's just prior we where kind environment year, temporary

I have anything think trends, if half we But, yes, as keep to there. I it's we second the think mean, I develops, I economic sort think new don't recent the So positive. of report

Ravi Shanker

thank you. Understood,

Operator

The next with question is Susquehanna. from Bascome Majors

line open. Your is

Bascome Majors

about yellow you've situation with meeting investors since probably of Doug, every spoken in Fritz, the beginning June.

of You've within for conference the right and situation the way how your on it. may forest it? we're the is the long unit impact heard missing of kind you this term the on quarter, And from business? mid-term on where what both LTL. impacts asking term, are trees from there getting short I'm outside places And this Thank calls see could we're what your curious, investment perspective, you.

Fritz Holzgrefe

And take And expectation they higher percentage kind then other they in to bit evenly lower customer to customer. player it that's the going around freight the market. that potential go three business going to a exiting, requirement to I that to obviously still a elsewhere top maybe the displaces of you match everybody potentially. a necessarily business the Maybe -- not waiting to is its has it's that way maybe player way around is it's that it's when service -- going -- got players going an the it's its to think go a in outsize at for in think, to go makes potentially, of to the going find service a that that I level, there. have service. final industry, verdict But Well, think I there's of highest the level

think that, -- get if industry. you understand a people going it's But to player, in I displace disrupt the large the redistributed generally

match the And whatever to straightforward. to to the think key freight fundamentals think the I I ends remaining is up. Saia, of quite think for understand players, thing where the Saia will the fundamental think are that I is I value proposition that

and us than this an a grow the environment, what a high opportunity opportunity to an growth continue have to there's have been. for we us. continue structure get margin at faster service, to business, probably We pricing the levels In to significant opportunity of maintain right there's rate for bit in

Bascome Majors

initially, we in and away You've not is probably been hope X, of this situation, revenue pro should here? adamant brand rather some I the comes mentioning of to take what so less the satisfied really is service that they're message getting mean, answers with and they're rata that all you more your take that your service share in in quality at back when than of

Fritz Holzgrefe

if never been of or to Saia are time, focus that we market over that business, business. in in one follow our this think business chase fundamentals generating been has volume, I share, think on returns you our the I have

profitability. And we our lot so, how internally talk a about managing we're around

exactly level is same Maintain high of that expect willing be we'll and the a customers of service. that sort expect this service, So to the scenario. that pay customers for

for proposition winning the us. that's And

that. and So it's you not when those are and where out to the to sort public you peers get can in that is take there's pursue business. see and us there, performance other to try apparent not our see looks necessarily who what like, no at level be And fastest, that's reason we it's for big that that we value look it's of generating of biggest, pretty about returns the

Bascome Majors

Fritz. you, Thank

Operator

line Moore Stephanie Jefferies, from open. is is question next with The your

Stephanie Moore

back quarter. top you I line performance average. I QX the little certainly one Thank the give probably color than better our performance given I actually more think, was good like you called that a touch I wanted OR with second on on expectations. maybe just the But the seems with just environment morning. think seasonal in for week in it a bit line bit historical you. it's the, exceeded could and out to Hi, little falling more the hoping

touch can despite that or of continued or line. levers on you trends, to pulled seasonal a Thanks. dynamics you to line kind with happened a what the maybe be in weak be of more guys little So bit what top kind

Fritz Holzgrefe

came I'd solid. was revenue shipment ex-fuel mean, mix how we per we positive, in really shipment to the were I really Yes, the up could in the pleased revenue X.X% per and quarter control number say, how -- extent we primarily, real we with

was and I and that May, think the month get we it of was solid, like half into you had and expectations. that baked not and have then our up, I solid but a step might we kind normally said back June, quarter of it

you like some some opportunities you addition, pickup at shipments, more give So and to that get cost that more from the productive, when customers, extent you more volume, and got that some things from be the things in you that. like to of economies do network

I but favorability activity quarter. and bit little So, than you just into operational get better think success on some might we four primarily have some seen there probably the weeks here and a things, was

Stephanie Moore

Great, a And follow just that's then up. quick helpful.

Any this with the additional here in You months. about talked the be decision between a ability coming lot today expansion to to opportunity opportunistic your just terminal or in terminals. change site, strategy lease buy

Fritz Holzgrefe

assets maybe the little, buy that, buy to willing lease, attractive years term something we the lease if But that own of opportunity, want XX build business opportunity strategic we'd for a like to that an and can't are. cheap, asset. we're view sort like if preference, volume what when a NOI or to we market If to if not attractive over about those. but a a maybe XX-year of it, can as market, find investor to And it. of want we willing to we the We would life. to would decision longer we finding be to kind that, do it's we've got along get in the be it's lease reason an economics in asset, there's sale, a a whatever to costs an make got first the kind can priorities strategic we're for sure case, it's Maybe an around hold available we an work? In we buy for trends on it's think it. ones Our that we're not do it's to a facility, our

Stephanie Moore

so much. Great, thank you

Operator

Stifel, from The with line open. is question next Bruce is your Chan

Bruce Chan

good morning congrats and here. the Doug, on Fritz, result Hey,

follow PL is with I'm or business. on comment to on just balanced the Just you an early activity on more three pretty national And national field account all want side where topic, earlier Or been are far? accounts I it mentioned the so up account any guess, that the curious side? early seeing side you demand on

Fritz Holzgrefe

a maybe there. it's a multiple across maybe big of that don't an that little account, a multiple field think have little saw, bit share I bit develop. where that's color volume accounts If we in maybe providers, I it's come more seeing those to that account think that maybe we're going probably sooner. we If we're still providers, those

that early So on it's we're only two still weeks this. three or weeks into

Bruce Chan

that makes of dust one outside wouldn't gain kind lot a everything when clears, you But necessarily? Okay, share those any sense. the out and of in of any settles categories, expect

Fritz Holzgrefe

call too something to way me make It's for that. like on early a

Bruce Chan

planning up you Okay, trends. up fair here, nearshoring about follow volume just then quick for enough. the talked also And And a brought you opportunity. XX-year

what any you whether maybe expansion and that to beyond your about As and cross presence and potential ramp have, plan, nearshoring about border current can appetite up? we you kind there's think talk of

Fritz Holzgrefe

smaller do across like. presence. South, we -- than it's particularly It's we'd board have of have We where

grow there's part over for for that I think strategy an us to sure. long time, term opportunity of the as

Bruce Chan

the Thanks Okay, great. for time.

Operator

is your open. Kuhn Christopher question next with from the line Company, Benchmark The is

Chris Kuhn

me Doug. for Fritz, Thanks Hey, here. morning. getting hey, Good Yes. in

I you this newer your Just some on, and volume shipment. per increasing of and weight is about shipment, revenue talked revenue lower focus lower Doug, on have weight per

So strategy ability profitability? of longer to your how your and balance you that manage term do sort with

Doug Col

like couple but by national our still we've was that mean, driven call it, that mean, And of of weights industrial I really Yes, said, I as good weighted customers up years. increasingly on we a quite I some have freight, last the over bit lighter can account in quality provide, that service volumes increasing see limited that's to sometimes more and asking that on be choices weighted the and we of service. shipments. that us with They're handle, more folks in maybe retail, may from, some the for that kind do focus example,

it's like to needs the haul it's moving in But, we're dramatically be terms appropriate but said, Fritz business mean, of weight not I to at So average. that form, rate. the going lighter it the

the So, pretty a up can mix I good business. of factor sole if lighter they're is don't in weight, negotiation, pick you or think it's you three volume the weight get, that up when that's the usually it's business, itself to in show you get and shipment, two

it. of So, factor things a lot into

Chris Kuhn

thanks. Okay,

Operator

line with Tyler from open. James, next Brown your Raymond is is The question

Tyler Brown

Hey, good morning, guys.

markets tight you all like, And years, work now, feel the the capital you look curious how over labor you last First from add given how quickly? do choice? are that human cultural on of you've And can an of perspective as what employer couple right they? a the then, think done do

Fritz Holzgrefe

good Tyler. Yes, question.

are is I necessarily and one around what competitive, of see the is. such I as and people is drivers little opportunity a kind think market you is don't compounds that bit in our things know tell kind last the in that and certainly favor. I that, our the labor that's the and the Saia has But years of changed I success over the demographics good job think done will the trajectory several of a pretty what of

able to that's the us important around, resources we've been made our that investments. recruit the to those So and substantial really professionalize investment pretty people been And helpful, opportunity to effort, in and also are human being to recruiting and give sought a scale, business.

throughout that's positive. but to the And that. being then they're job This be about that helped that's what to when to been think will things, help And and disruption, to think able sorts us think going we've that's People a going I to know come is we get see recruiting emphasis values thing us that and in that time, replicate that be values volume a in the good grow talk through. all that And front. challenging here, And this with important. to of going able done key action. can be they I through as they want see, I we those -- to employees that's the these, want

Tyler Brown

the a on real I quick, story. hey, put of touched this, years. network want have to and bit -- design It's work over kind linehaul you is been question. into of so of much again, and But couple a you absolutely. good But this Yes, a last guys technical the

market Patrick just Now think really and change is. If how you curious I'm much there Sugar flexibility quickly. conditions

You can markets, PT, some tack mentioned I'm excess call capacity feel like maybe brakes it is, the what Do what Maybe additional in asking others. you you you and capacity? term? traditional markets? if you add create tightness supplement and less at Basically, like in you near least with with have, that can and

Fritz Holzgrefe

as speak. that we mean, I absolutely. doing we Oh, are absolutely

-- how to bit I PT, is where is schedule this. team secret scale this. of of this. analytics this to know able So data place We to in sauce our little here, how we know know this the -- a to think to The we how advanced data we linehaul be and handle put sort Saia a place

you meet had even match way But demand within the as time, this. to us customer I and saw and mean, would it's allowed was our like to ago, be up if patterns team. event think adapt seven a now, to something well to the pandemic, during those down that what for be don't years five, and I our that's to an ability tool happen, through and set challenging adjust expectations. able operate there you is where through six, we this all successful be This it. to able And is

So what's think I get us that's going to through help this.

us about I'm customers skills kind those lighthaul adapting to So network of our excited deploying need. our and

Tyler Brown

Thank it. right. All love Yes, you.

Operator

any this We back have no remarks. further questions for I’ll time, the closing to turn it at presenters

Fritz Holzgrefe

really the of you everybody chapters about the giving about and excited you. to to this Saia at in for and the in Thank of taking story couple story. next an quarter. Thank look update everyone opportunity the Terrific. We're calling hear the next forward end

Operator

today's call. concludes This conference

now You may disconnect.

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