ULH - Earnings call transcript Q4 2017 | Universal Logistics Holdings, Inc.

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Operator

Hello, and welcome to Universal Logistics Holdings’ Fourth Quarter 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation.

During the course of this call, management may make forward-looking statements based on their best view of the business as seen today. Statements that are forward-looking relate to Universal's business objectives or expectations and can be identified by the use of the words such as believe, expect, anticipate, and project. to from uncertainties those subject could actual are materially differ expectations. statements risks and and results Such

As a Jeff may Rogers, reminder, Officer; Finance now Officer; my and this Jude begin. and conference is to Mr. Thank Vice your being Mr. introduce Investor Steven host, President Chief Relations. you Mr. Beres, Rogers, Fitzpatrick, Executive pleasure Chief Financial recorded. of It’s Mr. you.

Jeff Rogers

joining team the Earnings Holly. another Universal an Holdings history or Thanks, you last million Good of XXXX Universal Thank and XX.X% $XX Fourth most quarter year. quarter Call. revenue for The the in delivered morning. record Quarter represents million, in of over Logistics $XXX increase any our

XXX% over year. impact of last quarter the our fourth to earnings adjustments, Excluding increased tax per share

as experiencing with impacted Our production. top division we units showing our XXXX plans, growth still that is closed assembly business reduced out line auto all except dedicated specific momentum by continued

while year, astonishing capacity. basis, coming the unit. pipeline we Our how serve. Value an rate strength in to continued find and truck new our brokerage an and revenue brokerage year-over-year represents bullish loads up I'm $X.X over our Overall, continued load quarter by X.X% revenue is revenue at X.X%. FEMA which hurricanes service agents on at based was as this for haul added exceeded added to X.X%. FEMA difficult We $X revenue in due truckload mobile flat the ability delivered X.X% over grew new XX.X% a agency down. year billion, grew additional our industrial XX.X% increased XX.X% With annual in which as us we last has others load total from and agents $XX grew for sales run revenue we grow. was was heavy current winded see and XX.X%. it million and per services, of on truckload shows our load the and activity of XXXX for and In segments services million last from services XX the very excludes feel point, mentioned, that Flatbed accounted activity growth account to

As tighten, per have ability optimize the capacity continues load. to we revenue

and agents opportunities. by highest continually driven XX.X% revenue load being XX.X% operators Our count and of increases owner load choose per revenue the year-over-year revenue of Brokerage XX.X%. increases increased

its business difficult ever brokerage Our executed and delivered fourth financial quarter. a environment standalone in extremely best in the well performance

loads team X.X% we increased another XX.X%, to Overall, intermodal significantly finally in with containers. started up have Chicago has extremely and by we not solid revenue where I increase confident announced delivered tremendous increase a Our revenue driven load. move international in performance. recently in in did and per for team the our X.X% market footprint, Transportation the Fore of am a have opportunity. acquisition intermodal Pricing

where is but production has services revenue Fore existing Dedicated list brings one decrease to customers to to still decreased that The of since assembly This our eager new production X.X% a our grow and is in year-over-year. are to on Universal primarily quarter. plant resumed for customer grow one reduced the in shutdown eager legacy chip of customers location most markets blue are and a attributable schedule. with Chicago.

dedicated happy vertical, the model. in remains are utilize grow we automotive our and current for are profitable not the opinion long-term is working slightly rates, the of unit with While for outside assets the which hard better increase to results our stability my and key dedicated quarter, to a

one and had big to business segment a for bar highest in raises grow. forecast with [Audio truck heavy production Class trucks our confidence Gap] continue decade, in revenue our rebound this predicting value continues and production in a A growth Our years the to supporting add of of the the operations latest way, of

to looking them this ways stretched is assist base year. customer be us the in production to Our to many max capabilities as will their

value supports customers our retail add auto, aerospace, year-over-year. grewXX.X% industrial and business For that revenue

historical experienced on While about very what for The efforts segment being logistics profitable. momentum. $XX what this margins quarters we annual on from be implementation even came profitable piece did marginally with focus with make solidly and we so beyond agreement forward, headwinds of business. excited operation our are the that that we XXXX reasons expect with an we our many were going the levels Universal our below and more strong now can complete for will to last finished bring. behind XXXX us will are us expect for many large million to customer and us profitable versus improved have and very we on implementation, and efficiency There to pricing

do Fright higher Although, a focus thing anytime good leadership long-time to in of for and ahead. has for it we driver is rates see changes put advantage capacity on rates I soon. not our rise a is to take and support higher to continue and strategic industry, the us a decisions are for must Tight sustain do drivers wages who loose position what what and reinvestment. at these Universal we to

the right positive The to strengthens, supply continue the that and capital hiccups in is to on expect all chain and it’s investment Universal sustained to tax for our the impact and business new economy enforce only it will -- higher having law As see need into is the we what see bottlenecks rates. about.

more fleets. our plan Our will for Heavy bring expectation news good Haul more a Flatbed and infrastructure of robust also

policy. improve dividend our see cash, a more earnings will historical and our uses headwinds us we cash hopefully change for of to free flow the and positive and all our you markets, influences the beyond. release to in we last commentary significant Universal’s strategy Jude of levels our but behind expect free saw on night With provide in

our year cash and special have I’ll the use of expected a the XX%. paying of shareholder of our clearly up also results turn value. that, it XX% enhances feel this to and to Jude. increased good is consider we We forward, will a free at quarterly our dividend board With end The over earnings. financial dividend Going review

Jude Beres

a Thanks new the $X.XX in morning, accounted tax total adjustments, everyone. on This in XXXX. Holdings to of million of to $XX.X during operations fourth legislation increased our XXXX, of to per million XXXX. share to income $XX.X Consolidated an to deferred to in which which the income per share net by $XX.X Act fourth Universal primarily Universal one to Jeff. fourth related quarter revenues the $XX.X Cuts quarter signed million rate XXXX the $X.X million net EBITDA quarter. unfavorable in operating quarter. Jobs of $X.X $XX.X provision reported than and Logistics $XX.X $X.X for increased This from to Included in for year, $X.XX revaluing expected quarter XXXX. of per share revenues net of of share additional return the or on fourth of tax the benefit income the Trump of to million also resulting liability December adjustment increased income million experienced of or earlier. million operating million Good President was compares total XXXX. $XXX.X million per due the year our $XXX compared compares million $X.XX million tax tax an million of effective $X.XX larger reported charge quarter tax in $XX.X Tax the of in from

X.X% X.X% XXXX for EBITDA and fourth margin margin metrics are in respectively quarter These revenue. operating of X.X% fourth the operating and of and to quarter the of total Our X.X% XXXX. compare

of XX.X% to On our operating truck held Capital total million. our compared to increased at $XXX million in operations cash brokerage revenue $X $XXX.X services, we our operating intermodal, and securities. Outstanding million value quarter of heavy on operating where of businesses, income market from our segment million to income performance million million from of $X.X transportation comprised rose operating quarter service at million sheet, to net cash and A freight the we to debt in totaled and is compared million $XXX the marketable same million the the of to our income period. total transportation added $XX.X debt fourth XXXX. quarter which our $XXX and Looking operations of revenues quarter balance equivalents in for In million which XXXX. in XX.X% including our $X.X year $XX.X of and NVOCC increased totaling the $XXX.X million expenditures $X.X logistic of In million to segment, dedicated includes million fourth XXXX. compared for segment, $X.X totaled million Class truckload, the $X.X of revenues of costs on the the quarter issuance business, $X.X end last

million, free $XX.X million the we For cash totaled year, while generated CapEx XX.X flow. Universal in

capital million our of in dividend. million range $XX On expenditures be million. and Directors of Wednesday, For approximately expense the Universal's regular XXXX, to quarterly we declared are per Board $XX to expecting share $X.XX interest $XX

shareholders on expected March on and dividend the business to is March quarter's X, payable XXXX. This of is at record of XXXX XX, to close paid be

to increased believe expensing margins allowing experienced due of corporate put the will to capital our to Universal over XXXX foreseeable the with next cash a path this changes expect purchases. tax we during The is result years, for improving planned different look operating to we operating flow return for the As equipment performance in We future. coupled profitability Universal the few period. out and and and full on rate XXXX to

the how we in Here overview to additional is of deploy near-term. capital that an expect

trailers. of experienced grow of Universals our rolled continue regiment spend we equipment. material fleet predictable XXXX, to recapitalize First, get and of fleet trailers trading rid the will past CapEx handling have allows for and a tractors to cycle some Universal the we’ve In choppiness in and and of to our out years. This trackers,

addition, able provide with the serving need. most our to will customers equipment updated In drivers and we transportation their be

continue will core service look lines. strategic acquisitions we to Second, within for our

acquisition Universal As this of market Jeff Transportation the announced acquisition in month, Fore and Harvey, the mentioned, earlier reentered Illinois.

not drivers footprint XX in added over market. operator Chicago our to experienced fleet, intermodal XXX Fore, owner logistics solutions Universal land and a full acre company a the it provider, service located immediately provided only strategically

with strategic for bring management property business. who we can looking them within and businesses We acquire our like space are Fore the a of with actively if possible piece experienced

Third, we're debt. to continue down pay going to

Our debt currently over EBITDA X to a is times. little

ability for at acquisition. Since programs. million has and X.X to shareholders. want target returned our shareholders times up EBITDA the XXXX, to our capital returning through flex $XX buyback we is continue stock finally, to with around Our over the And to dividend policy Universal

and Fore will levels evidenced policy cash strike Holly, strive and in acquisition our capital deploying and we’re our of With returning detailed by take dividend the our balance shareholders updated debt As our ready questions. earlier. that, improve, recent right flow of as business to we the some to it Jeff

Operator

[indiscernible] first Instructions] from question will [Operator Our of come Capital. line Mike the

Your line open. is

Unidentified Analyst

XXXX. a great night. with basis company link, the this your of XX% price last That to a prior went good the release years at significantly is doing, pro seems and better. on back XXXX the And was through situation, line. on is and a top it And looking we're overview past and forma more year better, was of think underlying the about demand the I now I years significantly I

So get the peak pass so to trying prior really EPS expect this as I'm we year, revenues than And number over later. figure we better out and to years. few this the run higher our network prior cycle peak sooner with higher why we hopefully the to the well. peak year than blow isn’t back that EPS in coming assume next peak the significantly to Should margins next over

Jeff Rogers

performance. coming really is in truckload things was operations, that -- to back which in say are to in where best, ramping to to performance, you’re going expect their probably up. but they’re get hear intermodal really, I are Westport we their would having we my get A those not units, the comments. a and what they that expect lot now back their what knows going them near historical and I who whether said clearly truck because I that's some historical of we to their There’re to from Class performing or beyond, back back demonstrated ’XX, is best get of well, expect ’XX best But the term, best that's still

not the there looking and brokerage margins a is better, so where better getting piece this in because X% together we're that's and is they’re everything coming it's were and that is brokerage, either. for. becoming now So they there there before But just at are larger margins and what the

market don’t it we things link get of play back that's it’s of the has the in expect the talked the you of to business honestly so couple make lot about been that's in efforts interact and your customer the this I’ve with that last really legacy the over a and times, is to versus margins years customers and focused. holding way because with working margins do So numerous different add just us real-estate legacy real-estate are got and the the historical different. margins, favor. said and link the The compressing you've can a where to on all It's we've that. lot who that is their the really is I issue value and I obviously that

what to really two plus and business little would is XX% margins. So But get years. they is to haven’t back work with been happy that there And we a different. bit to trying for to the business what we're be

do not what into as ever got we’re that's that expectation before. if technology think what year will we will also done lead or earnings this next year, whether than performance good than some the the ever to next throughout And I that better that's we've changes through going we had. drive that, year So and better still it we've happens if

what why do a is should of able year just takes The there is or of it place only year. to you’re when this really we question to So the next as reasons lot into asking. timing it be

Unidentified Analyst

to number, revenues math the which $X approach to just plus, into get $X.XX question. if like The are so that. I $X lead get the no that reason my we is those and will seems It cycle. peak to this last higher was much doing next was there margins plus me shouldn’t $X.XX, get higher will this just to -- peak So get plus we

these to a move. group. think basis, doing want at look cheap I you as EPS divined, an look transportation think basis, nothing tenders a looking so really you dividend is There we valuation on continuing such it. however is or When you the we’re the Did a the I value at on was levels one your an announces out new were whether on Dutch to is at another of to EBITDA great flow at discount it well? capital trading excellent we're policy which as along the consider goal cash allocation, our approaching intrinsic the trading entire there, with

Jeff Rogers

like around said no Mike Well, I there been has conversations a [Dutch] option.

dividend going So the year with out money a have can what good buck sit talk earnings, -- additional kick to right now continue we hopefully which XX% we're we've laid and at shareholders. And talk then think about the of I we return and board dividend provide will we and policy. end the at the year and and special a very there back will to about the

Unidentified Analyst

the were trying looking new enter And we're not some of to then specifics can the but markets hood the little diversify and a bids at, give to one, as end us new last to under company. you customers

Jeff Rogers

as truckload transactional is well intermodal. The as

just base. defense. last to really all job trying in done new from years defense of it’s an customers add and there that diversify is But a with, of want over new a great So not that group and We is other perspective. customers will the businesses, acquisition us from for value my intermodal Fore to We’ve awesome expand real no piece come brought a the new Transportation about and further diversify opinion go contractor. those have business those two customer which done the aerospace whole really in and list of we which customers a business than the specific

as because can we grew I of awful customer have this I said to spaces, hindsight I'm we Boeing I’ve much side. other grow, done add just is want the we're point, before, think on and growth an getting aerospace value we fast looks the disciplined a because on to. of So of some what so from we’ve those as And in lot think with bullish from so grow we and where we why perspective My in companies. be

I problems a think of from margin some our that created perspective.

going is to we few there going do a be because companies because disciplined such we're forward, only an So a what little do. opportunity more

so to margins to improving just on just always that Again, grow disciplined side got just years such sure that was our we revenue that lose So couple the opportunity is last revenue. staying or make of it’s focused the get we the we’ve bigger, on don’t caught growth on our margins where much. now of have

do going going So forward. to we're that’s what

Operator

Wetherbee, comes question the Instructions] next Our [Operator Chris from of line Citigroup.

Unidentified Analyst

This is the ask Chris. another regarding returns for just want to question I capital dividend. on William about the

basic targeting that in the I by wondering the dividends? total was front. So like XX% ratio know your common evaluating just that dividend typically of on a just you're and special for increased special the or normal dividend. I you clarity is and specials dividend XX%, the for you payout Are

Jeff Rogers

I it XX%. that But just of XX%, mean declare time to but exceed XX%, No, bracket. up the to a gives doesn’t we’re not that a we wanted be it would going state that bit at is board think given going up to so to just little us always

Unidentified Analyst

on just up a follow that. And

guys about also you front. X% Fore going you and growth and to your was just dividend forward outlook you I down XXXX. dedicated recent comment if growing to growth also the opportunities that continue down on and on in CapEx those given acquisition your got what to get of and year-over-year back -- you So wondering where increase, it organic fact to see for could

Jeff Rogers

next the my dedicated us sense there could is automotive in it’s to that back want side go we so want on model. We’ve comment that will grow opportunities, grow I could what again, unlimited a fast difficult even that transportation be as roof can we've -- lock doing perspective. than because to make got model, dedicated pricing, to just grow with tomorrow, year growth smart. just the you what driver got what's make on as XX sure in outside of just that are And dedicated you've or arising rate want to and faster account with through for to the focused a Well, now got I two. And we been knows to we're now and to for dedicated you on it's to going structure the list automotive. try really, smart prices the really dedicated of really from opportunities into I’ve it automotive piece the everybody we

transportation what can all that's disciplined is in we're make is make we doing very be what business and to now capacity dedicated trying the on, understand of we to cost that up smart side cases to a going written as well. pieces some because really trying and sure fast on of So secure the

matter So dedicated that's smart we this, grow tomorrow about being just it’s could it. caution I'm like of just a

the to quarters. last So experienced than anything I couple expect any growth, of going the the of be don’t different organic forward we've what rest

mean it. value think the could growth growth but I that's add last is the massive minimum environment bit, I thought because businesses So pricing -- a mean but a rest just up slow think we of more. at XX% about down I only and just little year

my -- perspective. not sale is to an so on organic issue a pipeline, comment from billion XX% would I expect growth going So $X.X the at minimum be

Operator

have questions currently in queue. no And Instructions] we the [Operator

Jeff Rogers

in and great talk thank this Universal. you coming I so appreciate up your We’ll morning, appreciate everybody care, Holly, you interest a in April. joining Friday. have much. to Take sure us I

Operator

appreciate you. do participation and today’s Thank your will disconnect. that conclude call. We ask That you conference

Jeff Rogers	Chief Executive Officer
Jude Beres	Chief Financial Officer
Steven Fitzpatrick	Vice President of Finance and Investor Relations

Universal Logistics (ULH) 23 Feb 182017 Q4 Earnings call transcript