ULH - Earnings call transcript Q4 2021 | Universal Logistics Holdings, Inc.

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Operator

00:09 Hello. And welcome to Universal Logistics Holding Fourth Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-the answer session will follow the formal presentation. 00:23 During the course of this call management may make forward-looking statements based on their view of the business as seen today. and relate identified business the by as expect, forward-looking and or words are believe, be can the anticipate that to objectives Universal expectations such Statements project. use of risks Such statements differ from expectations. those uncertainties actual results materially and are could and to subject

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

Tim Phillips

joining XX:XX Logistics Good morning and thank fourth you call. for earnings Universal quarter Holdings

all quarter saw were key of corporation's executing extremely year. advance the Universal earnings We the our operating customers, organization. in yearly facilities, talents continue on was of While the record our of fronts, I to all and the not continued and through to -- entering quarterly business of, XX:XX extremely fourth leaves reported new results adding is for earnings yesterday's throughout the what pleased total reflect Universal disruption. footprint associates. revenues Although, XXXX do which me operating per share, base million. quarter supply by income share totally to capable per recording revenue, levels on the our XX:XX and team Now $X.XX optimistic new left team release, our we talented quarter, the chain resilience headwinds organization with Universal's strategy several employees our of of $XX.X

in Fourth operating highest revenue charges of included earnings launch revenues reflect $X.XX in and Detroit. fourth share quarter detailed As release, logistics in ever. operational incurred losses contract the litigation-related Universal's quarterly recent quarter per

experience color of at we mentioned, to locations. lines. our our service segment, highlighted some due to part our on as earnings shortages by several However, and for chip we downtime fell Contract short continue Logistics headwinds, production XX:XX In our Now expectations. of previously key

been to have successful price in increases to of contractual the help with inflation. offset obtaining many partners We continued our business

Autos While and truck radar first challenged supply moving and high parts trucks, saw continue Detroit. XX:XX and production which the schedules. another associated Production our and chain remain Logistics year. auto to operation challenging remain for operation the Contract demand the totaling a fluency of X million problems, $XX group quarter remains million navigate automotive their and again, nearly for chip of servicing Our the on customers will supply $X with quarter new for XXXX. the through Class our Once customer losses has

As with center extremely most been a in heavy Midwest. large tight an dedicated from people and boarding logistics talent challenge successfully a new launched space, to supporting In space, the provider a over in on an the we December, XX:XX XXX partner. in Although automotive continue labor market. in logistics this we transportation late labor piece were has business existing in of awarded we invest in equipment large

quarter first launch is latter the prepping operation. of the in XXX drivers part support to Our the dedicated plus of this team

strong quarter. aerospace We expect previously a year. for begin $XX logistics revenue run with logistics In second supporting a XX:XX mentioned the over contract and rate services. centers our Demand will launching opportunity Logistics rapid beginning our full a of launch group at Contract million addition, large the of a customer remains

the the of opportunities the Group headwinds the the robust experienced of remain mid-sized pipeline list. opportunity availability Our as and quarter equipment many in of top XX:XX several latter Our reaching Intermodal throughout with same stages process. remains fourth procurement at XXXX, the of Drayage congestion

charges expected getting Intermodal million. billings charges remain numbers a hot result remain XX:XX in are market as of the a and elevated $XX.X America. remain contractor segments contractors Accessorial in driver as chassis our Accessorial truckload and experience demurrage, face storage diem to red or own congestion competition because While flat, totaled the high and North our recruiting quarter authority. their of

combination driver the our closely with into extremely load per better quarter worked revenue group congestion, on capitalize at stagnant load to market pricing. position realized agent exited rationalize a truckload labor close and The which we Through and the per increases congestion shortage customers our the In strong up half quarter. pricing. billings profile. We XX:XX strong expect to to with base favorable XX.X% of inflation. Our haul, was of The of in strong over and Trucking improvement accessorial a the load. XX:XX tight over by run strong moving in increase revenue in able Intermodal XXXX. increase XX%, increased rates in the margin count. our was our loads our a a remains to with and increase of the of our worked year the of of quarter length was fourth Wind our and increase a near a demand for revenue with future year-over-year result XX.X% down XX.X% first Revenue customers more sequentially. price XX.X% and business capacity length segment, spurred We have plenty with XX.X% freight did We was count increase year-over-year realize haul, because very

recruit the agents growth of agent with of XX:XX XX to in continued compile. excited for will network. our and agents years agents continues quest be new measured our new by represented the XXXX on-boarded equally into growth that Group our pipeline Our contractors new recruit best one and ability about to

number Operating a pleased to we loads $X,XXX per capacity continue quarter. perform load, tight and of per although, Our was the operation brokerage broker load well company down the revenue increased with in discipline XX.X%, utilization hauled pricing very to XX.X% in market. our managed were

remains move amount XX:XX in of need -- mean the high quarter the a our assess line the capacity we Group single our small through the we tight, carry and of top operating first rates moves a I to As capped mid-record they this a access brokers X% XXXX, amount Although revenue, allowed week. by move discipline expect to brokerage -- obtain margin.

spot expect on extend strong opportunities will March. We to a market capitalize

we cadence continue As resource associates launch, continue mentioned Finally, our be some to XX:XX to turn our headwinds, greatest launch business the talented shareholders new people helped call existing to and were front to onboard grow will XX:XX and we the like high return value margin were I Universal Outside rationalize which fundamentals entering Holdings. strong would growth. to of truly now Jude? of in able are service over labor nearly and our XXXX a will revenue strong. X,XXX and before, We in XXXX to to with associates. I Jude. our XXXX believe of Logistics opportunities.

Jude Beres

launched million million expected $XX.X operating XXXX’s per impacted $XX.X the program million the these the to basis These Tim. on fourth charges drag of of metrics of in operating quarter year. XXX XX:XX in in logistics total margin X.X% million to $XXX respectively This $X Logistics the earnings fourth Holdings in in Good or a $X.XX $XXX.X everyone. million XX.X% net total the limits recently of as operating Thanks, Detroit. compared compared operations $X.XX compares of million earlier. quarter as net compares during morning, operating decreased incurred items million million $X reported results For and million margin liability are adversely of income X.X% on of and share of consolidated fourth $XX.X of period $XX.X on million operating last well the and to XXXX. by of quarter revenues revenues XX:XX Consolidated income to auto $X.XX policy were of quarter, EBITDA per our Universal $XX.X for in for of X.X% revenues. quarter XX:XX settle contract operating share quarter losses the operating over one $X.X from per fourth Our which to ratio million, to or to XXXX. $XX.X income for our claims points approximately share. XXXX. same fourth EBITDA was total pre-tax were year the Included and XXXX quarter

fourth and includes segment, to of Contract operating Looking million decreased million revenue revenues. $XXX.X of quarter million XXXX. a income of the total compares quarter the X% This quarter operations fourth on total from to at a operating of $XXX.X Logistics operating $X.X of segment were versus $XX last $X.X income XXXX, value-added margins businesses, on which performance Operating for million transportation for million the year. our our X.X% in dedicated XX:XX in our

our OEM launches Detroit. business Contract Tim's our in $X supporting quarter, in and mentioned a release, and automotive third As million in incurred comments here loss one of our in the an Logistics

This availability decreased of XXX trucking last and based from $XXX.X income increased margins impacted over quarter expected our segment, impacted compares quarter impacted operating to operating segment, customers These XXXX. year, compared the to with million segment, XX:XX for operations $XXX,XXX to the This to million declined of and year, Trucking quarter $X points $XX.X For quarter operating income from to held the year, income Operating same of last million quarter. both quarter the last sheet, company of in in the in $X.X Outstanding auto somewhat by and income (ph) million the truckload $X.X $XX.X versus customary to same the income million margin $XX.X our On points compares -- income income our balance capital charge securities. outstanding for to million basis downtime debt to been to of of the charges liability liabilities Capital we $X $XX.X million the the million for $X.X equivalents revenues or operations, our million to XXXX. year. totaling XXXX. lease of $X X.XX% from XXXX. cash operating transportation the EBITDA managed a $X.X interest compared to million lower from XX:XX $XX.X period increased end fourth for debt $XXX.X XX:XX X% cash and $XX In period, The operating by was totaled debt million. while to million. issuance million operations $XXX.X settlements year Intermodal ASC policy the to for X.X company revenues year. marketable $X.X million excluding launch million net $XX.X limits. operating This the net of compared to income and the agent related of margins to managed for by million. claims recorded for times. costs were segment quarter which million XXX in quarter our affected In million in XX:XX same expenditures fourth XX.X% have $X.X operations reported last $XX.X This revenues in range. million. than and fourth losses $XX.X full debt our increased operating totaled the Trucking $XXX.X million $X.X basis our our interest-bearing operating to expenditures in segments Due quarter equipment million In million adversely includes increased million Logistics full XXXX, million while Contract -- for quarter $X.X brokerage the while XXX, operating net of bearing compares segment the XX:XX at settle

result, be we XXXX the to current expenditures than in year. a our As capital expect higher

$XX margins expense million to line and between X.X% to interest quarter the are we on million. in XXXX, range we Based the operating to and expecting million first come are million for million $XXX $XX million current revenues $XXX in be of XXXX, environment the capital to the operating For between range. and top expenditures X.X% in and $XX expecting $XX

we our and finally, For XX:XX Universal's year in the are Board Directors share range. operating X% $X.X of and full between total -- dividends. to operating revenues declared of the quarterly $X.X billion $XX.X XXXX, per X% expecting margins billion revenue quarterly And

ready payable to This be XXXX. X, and that, April paid to close With to XXXX of X, record on business take quarter's on Justin, some dividend shareholders expected questions. of XX:XX March is is we're at the

Operator

thank And from first from Wetherbee Chris Citigroup. comes [Operator XX:XX And question you. Instructions] our

And Your our open. now mute, Bruce line your line going Stifel. open, question could Chan if your phones unmute is it? to is you come is from Chris, next now on please from

now is line Your open.

Bruce Chan

Bridge for what's thanks on around questions and with start morning, some the here. Ambassador just Good plants some a Hey. everybody closing want the Maybe heard XX:XX obviously, as about to going OEMs border, shutdowns on and result. we've the taking

quarter expect So there do that's is I to just the concerned? impact of whether having operations. material as want on as see a first sort far And you your what

Tim Phillips

XX:XX Yeah, Bruce. This question. the Yeah. Thanks for is Tim.

communicated result has that but that it I week up seen a that I that this production, as have I We push but had the have they're -- the We of border, disturbance going no down, result to is on autos we a of has blockade. short blip to getting there there see various shift be quarter. a being continue means a good some service. border forward first with and continue future shut couple facilities The we'll near to some shifting bit the been complete been at parts been There push this in of meeting this the of across of very see radar with as to to some little think today. hope come

Bruce Chan

here. was just color. that on a of $X the new the for to kind appreciate maybe that million hoping XX:XX the the charge. color sticking I facility is more kind or little Okay. with same of contract Is XXXX? majority contract facility logistics causing I or was of that that Great. a get And headache

Tim Phillips

That the facility that in itself, facility and XXXX. days ongoing an $X million to From seen charging wage that have rationalize customer were some operation, Yeah. charges same headache continued we've in working just some operating the on of for talks been as a the inflation, XX:XX there standpoint, progress the as some couple other the fourth recent of ago. the and process, quarter are with we is associated was

this through So allows it's place push some to the that we to them it get get to take as in to pricing hope next our us step.

not returning value spinning and are we So wheels. our

Bruce Chan

to issue, as of it. normalcy. expectations color kind any happens, us leverage that on can you've tough pure Okay. here is of just you XX:XX to shortage when their are And reminder top on is back? once back comes a see visibility give Got far I or in we just what of from as chip then there imagine but that the going your on cost gotten And whole terms maybe what variable come volumes return are customers essentially

Tim Phillips

come chips do quarter I leverage top what's of on the say Yeah. on with chip bits some is there and some this a pieces back. see when pieces some we I've what full their shortage. stream I chips of and parts. don't know production go have they problem would going what's into we one, XX:XX of if lot different holding up for sometimes get the The if and of of of is, learned is

see could the the where definitely is of parts -- the we holding are we definitely if call disturbance we service that is some been product there's that And on ourselves been demand. the or want find that chip level. a raw with for So associated is the area lucky to up it high that the a some of and we but this best event be plant material have that part, there could pieces that's inbound it there plants

they and funneling parts chips plants. are those into So

that overall the a Now, get production they comes a and probably internal the parts other want flow just that regular it as of of of to doing. on it pretty as still up have we disturbance, regular production schedule. still struggled had about is They have their some XX:XX we we Detroit. be spoke basis. own to level piece in the the So just see to But

got said look people there predictions we solid better have have the so solid put we together my as still expect would year if what to to the our I in they’re like fluency I hope some you hit vehicle and the first the ask -- parts. right quarter, piece and if have flow. would be chip that, you on to see at to production that, parts we you got face me I all the to got people the see a we'll the miss got progresses, be but we So are comments, the and that to

be still some will service. to there So short-term

Bruce Chan

then portfolio Good bit. the to diversifying ones the two contract XX:XX in just And little the new side a maybe on more to quick customers Got here. logistics it. coming see

As is about ramp on to may and as be some facilities, you kind you launching give – and think you normalize? of you when fade -- maybe those what headwind that the expect flavor can us margin

Tim Phillips

XX:XX Yeah.

Contract that in mentioned, one dedicated the Group, I first comes rationalized the inflation. On I wage our the Logistics is the market think which we when along with it agreement to

good spot. I in we'll space that enter a good in think a

services we're middle the as the by get have transition we part the this I QX, on ground XX of particular the that think we would running there lived for running hit think years. up of through of time, hard will the we in QX. last I and latter

are from towards comfortable that's value are launch expect So and take beginning expect troops the now the have little launch, will bit a customer. working this would at that bit to that's standpoint, up we customer with I with a we and been little a of we my to added rate. what labor run we've The hope. communication our launch the full into been aerospace a quarter. priced softer for collaboration longer directed That's it right what the on of our that get logistics space, contract second

mentioned we could kind of a that. So beginning bit the there But disturbance, little of launching our second is be expect of hiccup in to just one be latter I with the Detroit. quarter expectation don't hit with like any we

Bruce Chan

back contracts here, customer see then normal Got to normal of starting activity, progress segments, bid shipper to durations? sense. and lock kind terms maybe what in for speak just and you're Can we in you making activity Trucking are on XX:XX getting a cycle for also one people broadly just makes see of about there. some to seeing good And or last the the it. brokerage That you the

Tim Phillips

that. a They in Well, a locking negotiations the working a of that our bids customer or doing of our pricing on type of pricing. customers went rates quarterly. rounds we're XX:XX lot there the our sector, in and largest are been that things larger is inflation through just out I inflation, we for at yes, are contract there couple we've through yes, short-term pricing and lot is there and, out customers of wage say that year still would

I that the see So of there that we'll the think still and near some that is marketplace in future. into

Bruce Chan

XX:XX best congratulations of always that year. Well, tough the a appreciate and on Great. color I making as Okay.

Tim Phillips

XX:XX Thanks, Bruce.

Jude Beres

XX:XX Thank you.

Operator

thank XX:XX And comes our question from line your is from And you. Instructions] now open. Chris, next [Operator Citigroup. Chris Wetherbee

Unidentified Participant

Hey, we XX:XX Maybe guys. Chris. thanks. technical Good for is morning, can [indiscernible] Intermodal. Thanks This for start with earlier. difficulties on

tack to the curious what same box just like right could side that? expecting about So think And it I from from look just guys you Thanks. of load you delivery. And a revenue what normalized now. taking the year? side to you with hard that CapEx are guys on the look at of it's per question, that congestion could then then to the intermodal talk do maybe throughout know in

Tim Phillips

of revenue? your something up at part were load said first -- did extent looking some of you of last Well, normalized XX:XX hear towards your the part, the question, broke I you

Unidentified Participant

Yeah. XX:XX

that XXXX? So Thanks. one like throughout what trends guess that guys we could think what you start be container could just might and look there, CapEx box and the I then

Tim Phillips

think hold will with that, stands will I as load -- XX:XX strong. let's we per the right now, start Well, revenue Right. it

seen any in deterioration that. haven't We

country. and that out around fluency various productivity in In the really pricing congestion driver The opposite. to premium the levels spaces. we that because there have the of is experiencing of options hurt transportation contractor mention the not for initiatives pushing We're and fact, that the pricing the are still our we're the just

of I'm to what I So see what now better, we're to as we'll similar of even I that to put does maybe this seeing or outside stay the it, think come some accessorial near-term here spot a earth some it think down tad this is is we'll but when you'd of sure see least some pricing of reduction, for the year. at --

Jude Beres

all so in CapEx the don't international primarily the we on we box our XX-foot not XX:XX market And we're domestic buy XXXX, for boxes, at because buy chassis side, and box the the market.

box. currently XXX hearing end somewhere about on $X the so now, we right if half what but we're somewhere box. depending which them, availability, would buying lower to high-end, XXX to can planning most million chassis that million that on between on be of The get likely based $XX we're million about about So between XXX, on X

Unidentified Participant

Yeah, you looks the it bring said turn and Maybe you. side, right drivers. we XXX the you to guys, to talk hiring like XX:XX about far sense. looked on dedicated what new guys like you're process you what Thank that environment for Can going can makes now? just so

Jude Beres

towers. be process our you successful, Yes, thing optimistic plus accordingly wage be in new to pretty process. to went with we time on will market price upfront You would a optimistic right driver about this to from a Remember And up that set about were some to is recruiting. task, what XX:XX of definitely, very of ourselves were drivers on this, in the to do this cadence capitalize now, I very I that's the going point, that we where think able bringing as into tell the XXX hiring of about a into we very, even we am we are maybe rate in period short because

So launch I March. cadence at don't this launch. start point the that there will anything think in disturbs out The of the

the get get by four two through over launch, the We the three at week extremely or phase drivers. of optimistic first the enough end which have and period. the is of of we I'm lines, We time

about the are too. labor services, major so provide I will it think is very of market the other into it. equipment just We about We're I to go. expertise feel will is there. this with. something quick driver teams have of have feel couple We experience this lot good good and up it there, we why implementation we type every every a a of up be a there. same in facility, ready and launch That's I

Unidentified Participant

the guys. for XX:XX That Thanks sense. makes Appreciate it. time,

Tim Phillips

XX:XX Yeah. Thank you.

Operator

for XX:XX I back remarks. showing further turn like Thank Tim to you. I'm And to questions. Phillips closing now would no the call

Tim Phillips

XX:XX and we Well, pricing, go continuing I assure XXXX. last appreciate calling not I you in going you least on is to to Thank calling but thanks uniformity for process, very through of in focusing and Universal talking our be as look soon. people, you. and you can safety forward to technology

Operator

XX:XX Speakers, for This today's now and you standby. you concludes conference Thank please call. participating may disconnect.

Universal Logistics (ULH) 11 Feb 222021 Q4 Earnings call transcript