SNDR - Earnings call transcript Q2 2021 | Schneider National, Inc.

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Operator

Greetings, and welcome to the Schneider earnings call. At this time, all participants are in a listen-only mode. [Operator Instructions].

As a reminder, this conference is being recorded. I would now like to turn the call over to your host, Steve Bindas, Director of IR.

Steve Bindas

good and operator, you, morning everyone. Thank

company on and Chief me President available Chief today, on the which Relations press Bruffett, website call President Rourke, and at the Earlier Officer. of Mark the are Financial an Executive is Vice earnings release, today Executive Joining issued section Officer; our Investor Steve and www.schneider.com.

provisions about forward-looking under and prospects the which constitute statements Our the plans safe federal call for applicable forecasts, harbor will securities laws. future expectations, include of for remarks purposes Schneider,

identified statements results involve including, filings, to discussed current company statements risks this cause Forward-looking All uncertainties required earnings and except risks uncertainties most SEC any by investors in Schneider today’s to are expectations. but could statements, as of date recent that to forward-looking not urges review actual Form call, and our the and from the limited risks differ duty as law. to of disclaims release. and such made materially in The XX-K our update those

comparable pursuant G, includes referenced found measures. a measures any financial can non-GAAP call most today’s during our Regulation addition, the directly to earnings release, in to reconciliations reconciliation which of In GAAP be

over call Mark. our Now to turn I’d like the CEO, Rourke. Mark to

Mark Rourke

quarter on the Thank three into next Schneider thank open commentary for you, Schneider XXXX, second and operating Steve. will you Hello, segment everyone half the well today. our second call we with the and and as what context I for year. expect joining of up dialogue results as our for

insight full overall on earnings and into questions, enterprise CapEx close brief your Steve out updated per to results range will year affirm Bruffett some get commentary. we additional expectations provide Before share some guidance, our

quarter, second out. things the review jump you should As several

long-term the the quarter, current both and end with above first from sequential segments improvement of business the our target solid margin ranges. top First, finishing delivered margin Truckload Intermodal

the a quarter year million This network coverage offset an businesses. ago, grew driver its for as from allowed our Secondly, keeping asset-light outcome our to Logistics and the serving some our of The capacity demonstrated the as to with platform second freight our leverage to multimodal the strategy of our aggregator balanced serve corresponding the in community. over while in freight enterprise. asset-heavy revenues of shipper to is capacity as chain customers, us of $XXX value supply portfolio revenues within challenges capacity and supporting needs consistent our for an provide

remainder a a me Year-over-year, of quarter, setup count for on units on our of contract units on couple the and focus growth So is strategy. into average the growth. our XXXX, consistent In and again powerful minutes let of each in growth serves Truckload, configurations. XXX XXX was multiyear sales those dedicated it of our XXXX as spend tractor how with

develop pump our we CDL gains related across drivers will rates, driver series than of constrained churn also business Schneider’s the year seated terms and in start-up from work benefits our delivering beginning of in of new well as as We’ve training and see business, less the experienced a are professional over working priming existing portfolio second the for of quarter. plan units reopened we our own have quarter CDL as X% market. was the pay that compensation new productivity A In driver expense over remains several a Network our new ago, get invested quarter. Truckload as fleets. year highly our to the driver solo in what of the have process increases we last Class well in academies the born the and The in the second CDL start-ups drivers We of that mid-third fully tractor to a to

goal our in we toward the pushing in network last of still highlighted quarter are as X,XXX update. our tractors We

renewed base. was Network company’s tractor network in tractor percentage of shipper rate over in our from offset have utilization quarter, total sequentially the increases third All mix of valued book great lower remaining the revenue front of those were per was We was and first XXXX. the with in productivity flat second per the revenue investments mid-teen, quarter increase of XX% from the network the owner-operator levels. yield-related quarter. contract week to per XX% double-digit with the support as by team and scheduled realized Truckload as improvement a In be the quarter, stayed the improved X% in

the our point equipment preparing while used of market. into Our very supply year. replacement the OEM considering solid, capital we efficiency the the of receiving units deliveries at of high XX% disposal our number units strengthening Despite a a challenges, halfway uneven cadence received of have year tractor full was new tractor for

capital We have going to continue sale have forward. reduced we our which boosting ratios inventory, our efficiency for rates to driver tractor limited and intend held

Next, period. our ecosystem, data demand excess beyond in Intermodal labor the are our customers time our as from we average many of the can suffering move. increased grappling successfully challenges. from Intermodal is what economy extended can We customer segment XX% unload areas this with XXXX dwell has comparable like see

limiting certain network, Intermodal and rail in Additionally, at volume impact freight volumes times labor shortcomings resulting parts in ramp congestion critical allocations. the continue of to

we’re dray give in quarter X% consignees Despite year first equipment. of intend seated second of XX% turn our increase improved implemented been over to network fully from who a sequentially those to orders at quarter tractor not the hubs. shippers completely We order fleet volume some per of renewed, our priority challenges, to revenue expected achieved has double-digit and second XX% as and meaningful and efficiently the within nearly bend company although effectively ago. all quarter. Intermodal, Finally, Intermodal the low most not those high book as our has

of year. expect So we the in our second terms increase the to would container half

from year containers a X,XXX a ago. or X% grew count container Our

which overcoming our disposals, on is another Our net equipment X,XXX by up year-end, chain supply dependent are trying manufacturer we with. containers challenges, which goal to after delivery is help to to X,XXX

of its including segment’s of segment are in growth. pace power port and contributor a climbed $XXX thriving platform portfolio earnings The by from Finally, and million XX% second with growing freight contribution Logistics and last conditions earnings year Logistics year. revenues technology The A kept doubling people, Logistics, over our growth and million the largest services, market the investments our performance. of processes brokerage. or shippers volume of ago to the being the $XXX quarter segment across contract is for carriers driving combination continued of and our services,

to to we turn get I’ll Steve before your over questions. and there, stop me Let it

Steve Bruffett

Mark. everyone begin the our for you, to of And morning call. good updated year. guidance Thank I’ll overview on with full the an

to of $X.XX this of original an now second raised has demand, the continued these in for time with is $X.XX, capacity. in driver represents Our and adjusted At for the coupled guidance and increase sits strength XX%. at ranges, constrained been guidance $X.XX. EPS midpoint our guidance updated expectation this $X.XX was market Inherent to the

revenue and portfolio, a conditions of which Mark remainder earnings. Logistics XX% the these on expect our quarter asset-light of of We Intermodal setup our as throughout segments of that year, performance commented the I’ll and contributed XX% constructive add second and service of also XXXX. for this serves

also proportions that’s of fourth second, relatively we in earnings year strength even to earnings. place. in expect a note, than to and fourth anticipate seasonal that spike similar quarters third already market distribution half year. this the is in this We these the across But due be a the rather second quarter of of And the

to full effective a higher our $XXX prior expect Primary CapEx million reason guidance approximately the year to range lowering to continue proceeds We are rate $XXX million million. tax for XX% guide $XXX lower and $XXX down range million, a of and sales. our from of that’s equipment is anticipated net of to from

some We this expect we of into the could most for over receive spill although XXXX. that equipment of deliveries plan the to year,

Regarding second results, just quarter items. of point out a couple I’ll

income our in the was history, of million fourth operations quarter exceeding our the First, XXXX. from of profitable most $XXX quarter

and that next TuSimple, services in mark-to-market the reflects and and by income gain amount is So, the and by statement. coordination other operational in and strong this our achievement as professional essential reflected is provided commercial of our portfolio, our teams the a for is the net this significant of income milestone contained service a effort gain drivers. investment our of this $X.XX EPS always, from team, quarter of The $X.XX our second valued item, line across

note. $XX Regarding but note million million if maturing maturities, million the November to repay choose in both have a of in notes either intention our It’s we we maturity, a flexibility of balance with maturing have that reminder composed another $XX sheet, just this at XXXX. and that’s of path year, in note March ample $XXX a current

call we’ll that, your with So open the questions. for

Operator

Citi. [Operator Our Wetherbee from Instructions] is Chris question with proceed. first Please

Chris Wetherbee

Good but the generally, us are tractor back thanks. Maybe guys. maybe for I also for of particularly of and morning touch can the on segment, half per year. sort when with expectations appreciate guess, of then for the if help the could you per through Steve, just I for-hire maybe your earnings year. type guidance think of I bit revenue the think progression little Hey, a fleet about you the the what about, the the comments flattish XQ from the you end updated hi, guidance, environment, week. rate

of of inputs the that, kind would some If helpful. you can to break be down that

Mark Rourke

and Steve I, maybe comment question. on And Mark. both is this Chris, your

the We all through and our for-hire isn’t activity in section, our yet. renewal but of fairly it are book contractually Intermodal implemented

but quarter implemented So, than the are in very for have, so we third That we through that. and in better XX% renewal. about us late book have of are the we all instance, that have of in XX% Trucks Intermodal, X% in X% little, to addition that. front is the or quarter, still we

we still price know have believe we in we So, us contractually. appreciation have, front we of still

Steve Bruffett

about included whether and full go about the that. guidance, specifically I’ll talking and I it’s full year we’re or but included all imagine while question not a ask some we and how didn’t guidance, and And, you TuSimple this, - it’s think for gain year ahead about

ahead upfront. So, and I’ll just go that tackle

year, a this valuation, at surprising. know in share newly some when looking a particular we we’re would expect you volatility that’s not per being their full in and earnings public providing guidance and TuSimple We’re here company,

full that be course knows, year the whether as So there’s over a would had or to or who the of not amount be. anyone’s meaningful what guess it’s gain to

gain either not guidance So strategic other TuSimple or of not year any we’ve made. that investments upon the does equity or our rely full dependent is a from

clarify just I it. to wanted So that of aspect

Chris Wetherbee

Okay, going too follow-up, going we are of maybe And so tackling right actually I my just And that upfront, the helpful. is difficult in to that’s able one side do is driver for-hire appreciate be fleet, some availability that be the or then very you to point? that with on the helps. see where was is to on or this that commenting to at particularly just that wages stabilization fleet, something

Mark Rourke

is this some of build and challenges – particularly expect we’re solo the there, Chris, the the seeing had Mark. side starting year are of in encouragingly stability that team configuration. as we the and some side, Yes with I COVID team on to on last quarter and would the the we impact back

first quarter. still the is and saw but we in ways the our number So we growth, positive see got second that to to some back there, build step

to quarter serving item country so that. second academies up, and several other that of us our configurations. little and some starting primarily place certain is a we’ll different and that The process the for holders, in that non-CDL parts took And is perhaps in start dedicated benefit for is to Schneider network largely the see are in

So network to X,XXX some given year. that haven’t goal our we and end on again, see stabilization the of expect between another reason up why making now the we and progress in toward there the

Chris Wetherbee

you for that’s helpful. Okay, time. Thank so very you much

Operator

is question Stifel, please next proceed. Bert from Our with Subin

Bert Subin

Good morning the congrats quarter. and Hey! on

Mark Rourke

Bert. morning Good

Bert Subin

are because like rest implying you some seems on all the talk guys to very about of guidance right Trying what certainly firing some of just year? all the going the you feeling maybe Logistics It a at and tailwinds things well, are continue. or for for performing Truckload, that’s what Intermodal Can night, seems that this cylinders year like you’re it up to next keep of perhaps into now. and get are headwinds

Mark Rourke

improve ones the which the rest upon that component centers with we’ve the and headwinds – I still the to year, mentioned driver taken labor the we tailwinds, and obviously, actions – expect to to with some the grappling are and been certainly on around of grapple professional front. we’ve the So that try driver

We seeing flowing in are Intermodal improvement business. of some the the

and to mentioned real the having on So dual is increase what time side, period more big to issue comparable in a get and is box in opening issue count, bigger a I trying the across average for is has comments, rail the in our frustrating and volume been our a there. way some execution from network XX% ability fluidity issue us standpoint in XXXX. our customers the the my costing It serve our us big a put into

to But customers our priority, half given be while limiting there. we financially an that were that’s the have and from who it So a of, And year-end. our numbers situation. still our in around We’ve new judgment to customer with those the some is we we’ve to container most a we more optimistic can again, of judicious top whether assets, probably on some our fluid of tractors the cautiously encourage to accessorial in by get that favor actions the improve. will things to year, because good and really item also do we the of still we’re in questionable that very with a some like we cooperation Steve it’s to bring equipment, we’d community that to stay probably probably factor the here can done approaches so. network there our to on front, more most be equipment to half get can’t at on the get would bit feel Probably taken if intermodal our effectively focus that start first get

Bert Subin

you of for sort It think strong appreciate clearly a platforms are now. you know next revenue becoming emerge the by industry your Logistics item, that. with across do is Logistics my see What least over do is one know of Maybe largest gears right the of shifting why platforms? I to Schneider And like question. providers? do of apart share. Maybe be you You business sets years? going follow-up. other from bulk those the think you your for brokerage Okay, the ultimately few going couple seems at Thanks to

Mark Rourke

the couple increasingly been of we an assets. outlining now our our along been important certainly better market, this mix become Intermodal we’re Well, of an between we’ve believe The is path. for and our what Logistics we discussing element the of of Bert. asset-light Logistics particularly what share we’ve that part in can we business be do stand-alone the business simply years of building and think I and Thanks that and portion that will combination portfolio, a differentiating as the of part larger a toward do, and demonstrating our brokerage be a something for decade and that’ll of overflow

parties, purposefully. a think like put tech-savvy, box support of third expect to self-capability with mode very so in of seeing customers, to in our further being have advantage are more and customer. think so of that think It’s an to across its customers our there. out of So we’re doing about it – asset-heavy Logistics, every the it way the what to that starting how virtually of we and believe orange overflow both really and about a quarters bring a certainly little about bit as really transportation. they blending drivers much self-sufficient in as do portfolio great I of benefits great organization intermodally road. leverage a move we the over it. also last very we’re front the taking bring play together here see We it being accelerate lines very certainly you those together enjoying how is we’ve asset-light assets, model, our this we is that tied select while as having we even I that and and the And are What strategy, within time to over created we and couple And our strong use but and opportunity, we we’re how with people and platform and certainly don’t is to that to we solutions

Bert Subin

you. Thank

Operator

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

Ravi Shanker

Are questions early that set-up what like? morning, feelers in couple a looks on Good be side demand XXXX be on on confident year-on-year you I constructive you’re you Steve, Is cycle. the supply it having think to side? despite very get the A everyone. cycle, said can Great! positive to kind comments your that too the first on it is or comp? And very likely risk the also it’s difficult to XXXX. if more you think of there the the pricing of do into

Steve Bruffett

finish that the start those. suppose with think is for Yes, it I a for any same provide about additional I commentary this early we’re and can Steve. to with experiencing bit experienced But constraints have much XXXX. and capacity quick time, the Mark color don’t I’ll that while, a is comments. At there’s solution

XXXX so it time, At And were they to year of the is conclude would the more throughout that typical. begin this currently change, more to We would expectation be remain lead to a if a same conditions bit demand-driven our much conditions are market market that in beginning rest may that’s the and that so. like next. seasonality into experience event, me

in but seasonal would and environment see strong healthy like rate market haven’t outside think feels two condition now, in XXXX. that some cycle But I for, XXXX. been a in and would years remains we for result that that, We positive it of a I typical overall the may return think of

Ravi Shanker

as the there? share with EPS longer-term Got just time And kind a are are out how confident the it! strategy what a frame? of follow-up a you about of you. saying is XXXX you’re Steve being XQ kind had to market. roll bit that on in maybe include not Kind That’s you wanted product that TuSimple? what does well? work guidance you able to $X.XX of confirm, to And the also of TuSimple, great color. that I in And in doing Can Thank you

Steve Bruffett

I guidance first Yes, Steve what equity of the any investments this made. our that does on we’ve any from echo earlier, full is year And rely that. part to of the said upon not gains

Mark Rourke

and the very of very, it much as technology, world front on to that. relates end autonomous the Ravi, we’re

just it has of promise the intent involved what stage and certainly our respect of models and about together confident. learning certainly potential holds, TuSimple we’re and get are the we So what to we that is early and and the to being elements this how engagement how and the done and in might apply business

I have don’t world, we to trailer and So yet, even type manage talk people new I some have think model ingredients am takes the the look may cases lot maintenance about like. you things I that potentially that share across of include whatever to a a how to with the network having business ability as The to to network lot networks manage facility more things important, but it necessary to there the and important lot in and network of that of power that confident the and do support some and you in a like that are country. distributed – that a the

services to share to can that bear time maybe can think bring we into important those have periods. All the today, and future even in will more future our there. we’ll because develop over But that what business I we of becomes of more things think do I

Operator

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

Unidentified Analyst

Zack guys. on Todd. is This Hey for

I gains Intermodal, you. then are the or about TuSimple, guys quick some up is about there. I equipment guess, doesn’t thinking for gains, rail But I know the a guys remainder disruptions the Thank how the back guidance. year I of implemented are ask if it what the the of to but year? could half on through question terms you as pricing we of on margins incorporate considering said in and costs XX%. about know you just some the of And here, you expecting any of related Just go

Steve Bruffett

our into equipment and said the regarding so market of the of part we would broad conditions where we’ve on, and of the through gains to remainder recently expect what question there I lines something so inherent category is the along first lump The comments. this experiencing in we’ve persist been that year, current

Mark Rourke

book the comment On Intermodal the that my implemented. not is we about we renewed to all finished XX% up of you front, know contractual as quarter, have that our

quarter, to of we dray still in clearly our we some of of we’re we north the We’ll boxes bear season, well of what relative implementation dray to time executing take always XX% and renewed have feel feel expect get to is and the get advantage we’re retail really demand, some fourth market to So well-positioned. we if the really believe by in additional we’ve great control what plus turned what fleet, accomplished a gets the and and with place better which customers advantage the full our we third of in the we time. take the to be quarter us in faster to will boxes think our side on seasonality our assets

so well-positioned year Intermodal and the that will support the I And us, very strong we’ll the finish in quite and business. market think feel feel

Unidentified Analyst

more you bought second guess And cost forward, the just in guess, that what I helpful. there. the really what’s bit the quarter? And what then you driver then in a guys think on cost I Thanks. school to front, those the that the color schools? hear I’d was curious that’s quarter. driver said little capacity? I going run Okay, to is be just second

Mark Rourke

what is ongoing Yeah, in – and to of that into with ongoing phase a through. holder an recruiting more And the of you then process up that’s and second accepting bring your occurred some and type adjustments, kind takes profile non-CDL quarter. be to that infrastructure stand execution bit instructors profile to the of that the change and move really

not we one but here. the academies it’s our access partial really been been tapping that about started up So since meaningful our It’s we’ve not give in talking a that long full of have that since us just answer, like XXXX. capacity to we’re way about a into, will some answer, it’s

of a So the front the factor it’ll the half. first not that did half in year we contributing be second have on in driver the

Unidentified Analyst

Thanks guys.

Operator

Our Hoexter next Please America. with proceed. Bank Ken from question of is

Ken Hoexter

morning Good great! and Steve. Mark Hey,

for So those extra getting talk can markets. you, a the sticking with second, Intermodal of about maybe process

X,XXX in mentioned a the certainly X,XXX you half or hearing boxes the It’s think second of among peers. step-up some great obviously I in been difficulty year, your yields.

So question what a just then second you’re service rail is on just there the in thoughts fluidity? seeing and your

Mark Rourke

sorry, I’m Ken.

The first part of that question, I’m not sure I captured just...

Ken Hoexter

I going guess, us just comment, mentioned try to some your boxes boxes XXX our things just dig into Maybe you get only what we’re to – you’ve to to year-over-year. through mean do here. taken walk was I

the You’re a in talking second amount getting about half. up significant

said them. You us walk you get get confidence chain? in understand box the to delivery we you over things supply want here. get through them sizable to that your given how and do got the can tight we’ve ability some I Can step-up Just to

Mark Rourke

that box It’s referenced to on year-over-year about Yes, matter type we to to how more just they my that it we of built X,XXX, opening I the find of boxes XXXX. time ready. X,XXX range and of and supply the chain impact on get X,XXX finished an we in just stateside have a space make in as and June are comments

all as of can in confidence locked high lower the of so that Ken, things international the I range we of of locked I things got those on down, bump. when end learned, probably you’re so we’re and a But what those the the and that end do things reasonable with of we’ve dealing competitively X,XXX. range than amount go to are X,XXX on to more prefer on share particularly a not have number until we working And but get we’ve

And half you those. so a the it little until but confident see on bit on feeling the of reasonably ground, you get first cautious, it, should be

Ken Hoexter

on And fluidity service? the the rail

Mark Rourke

Memorial we’ve the the West particularly actually steady. Yes, in since on Day improvement, seen

down. have there’s overall some weather basis, if events that comments particularly Now a was that’s East, in what bit fluidity look and this a at longer-term some because And we’re really, difficulty slowed return importantly, little and heat-related on length have gets the is But And that of some of June, its although typical it you been on operate of East. around the done it had related in improving. a East, issues there just the the the based to it’s street with how the – of got more the the upon a in into as haul July. bigger dray, it’s well here in we month component we similar

but better more a So improvement improving, what and to historical get got room we back consider to would certainly for performance. it’s

Ken Hoexter

final I my just then if And one, can.

still running. You operating mentioned Any there see – of seating size – target and the schools X,XXX you growth it fleet you there? in difficulty sequentially. more if and driver get about What stability obviously maybe the you’ve in the can talk and about there? aspirational thoughts overall up on some you network and that’s coming mentioned I mean like obviously utilization. Do kind nice XXX sounds got the had you’ve dedicated truck and in

Mark Rourke

is lives. them Intermodal a and no dedicated the it that look about of and if of Yes to there it, some challenges on front, serves sense driver one for as place that network transfers does serve drivers ground, the where opportunities geographically our and the items make Ken, our makes a our for sense we well have feeding for us doubt driver for so network somewhat for

we want continue path drivers. career a to value have to our for So

the see accelerated continue seen and what to transfer of going we’ve adds year, quarter as then of what accelerated been sold, and some we’ve the some successful we’re see to that activity remainder our additional we we and so we’ve we’re had And every book the dedicated. for process in adding – to We in seating. both sold on already expect would

of We’re to and that type sure the and regularity work the having those those make to we income, more and it’s position, want we’re the of some of the of the of regularity making our because configurations community for there type available obviously fleet. success the attractive driver

Ken Hoexter

guys. it again. appreciate I a Thanks Thanks lot.

Operator

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

Scott Group

good back to to morning. just understand want I Hey! just it. Thanks, I sure guidance. to make the go I want Steve,

you’re So you’re level the constant. of just in even earnings you’re segments when that that and Logistics about Is rest of or they you percent distribution, the absolute talk the Intermodal about are expecting talking the like earnings XQ, what saying stay what an and were year? stay XQ, Truckload Logistics the versus XQ, saying Intermodal, of that’s you to Truckload, that’s in that

Steve Bruffett

earlier call. seasonality the the Yes. dimension would What an is year, first enterprise as a you standpoint. us thing speaking for weakest I’m If little the to I there a a was on from that know earnings quarter bit normal such be talked again, about

third in of some in in second and the quarters factors that quarter, we normally strength quarter playing time quarters ongoing of quarter market pretty – stronger look It’s negating a the of out to fourth those it’s that we itself in like kind fourth is other given and That’s incurred throughout experience. year. continue multiple the expect row. seasonal the we and similar most earnings expect then frothiness the the and each significantly terms EPS. Second And that of to we

we’re what to So if context trying to add convey. that helps some

Scott Group

I’m just to I guess. I sure I apologize, make understanding. want

with talking operating earnings. into So a third the I’m the about gain turns are about forgetting you $X.XX I’m did you in quarter. simple loss of the EPS talking two – mark-to-market that

in get pricing the impact full earnings, on half year? back do trucking, up the of as shows better Just operating those like the of Intermodal

Steve Bruffett

improvement do that said there’s anything segments. to nothing with I’ve TuSimple, operating I let earnings, and go. has in so about for sequential our think This all is room certainly

Mark Rourke

crack a I think take maybe at Scott, I’ll it.

fourth quarter of current in from on, be other, boxes Proportionately, different as pushing and we typical I the expect sequential see as the and performance don’t would of because we will of see to at have second believe operating available it you’re here. segment we the performance is our in Intermodal what lift the half have think to earnings of expect condition we in and all the the market capability operating will improvement and but what now dramatically year.

Scott Group

and business I improvement now the that And more year-over-year, would look seeing lot revenue continue? per Okay, thank thing. and to utilization guys you for-hire up you at the tractor right a in that makes XX% are just trucking some last sense, When expect then you.

Mark Rourke

years. from solo having than we put metric as itself the drivers mentioned, absolute Yes Scott, is in five we there. when which in component owner-operators home year our stronger are than out seeing generally company and a But are less time more our the fleet, at predominant on highs five teams less mix six or flattish. solo actually I mix side, utilization and has is are the we’ve who a of portion you in often utilization But in six the last absolutely seen standpoint, seeing

Scott Group

Thank Okay, helpful. guys very you Bye-bye. much.

Operator

The next comes with Brian please from JPMorgan, question proceed. Ossenbeck

Brian Ossenbeck

the Thanks Good question. Hey! taking for morning.

Mark Rourke

Brian. Hi

Brian Ossenbeck

with you, for the at operating But as business mentioned, of everybody in in as Mark. One trouble had the stand-alone, the We’ve seats always tech some you segments the – seen they’ve of morning. peers has environment. scale as overlay. had diversify diversified Good your you’ve this of kind drivers three sort keeping

get thoughts your So to here. on progression multiyear wanted the just

You’ve from maybe and looking now, cycle add contribution portfolio about here? How you earnings the Will or the grow revenue more the absent to on you highlighted right from more feel general be to longer-term growth do potentially asset-light. perspective?

Mark Rourke

Brian, Yes the for thanks question.

dedicated growth and the which Intermodal specialty focus be our will over primary are as on and time,” on know more earnings truck with trend side. some configurations this to we execute on very on to from portfolio. revenue side believe But that most over think time services there come “whatever Logistics more You are we think get good our will those contribution I defensible ability and is particularly in headwinds of on our do of cycles, some normal truck our the I

things double the things the next or on and But at ESG and we still coming deemphasize we’re that look to mentioned, So synergies you are the asset ways trends look to the just very, Intermodal’s we’ll that effectively across puts to environmentally, non-asset over from more it orange growth for our the proportionately truck, it pattern. intention. customers. doesn’t part the those that’s And We as asset-light box for business think growth of our with can very blend portfolio. of the bring nine and bullish – eight years continue those our

box for and up network. show what And our really makes starting for it’s the expect that’s our great in play about numbers. the talking sense particularly that see progressively momentum offerings to we to in time. it advent where you’ll And would a continue, and the and power-only of in our years configuration with our carriers view So that have customers, we’ve out orange over we and bringing been third-party last really several logistics, and

Brian Ossenbeck

Okay.

a mode your like opposed from current deviation where So the points are it now already right more as material maybe capabilities? are expanding into to reach different sounds the or you of focal

Mark Rourke

of lots have of we think I ahead runway us.

of we both So others, in of we freight, the about current have demand, our as and aggregation I runway approach. aggregation assets our lots think think of

Brian Ossenbeck

if And providing a you update FreightPower. mind quick Great! don’t on just

you launched progress stats can quarter, shipper some I the that that of Thank the on metrics maybe think you some so side last you. and and update share.

Mark Rourke

business in you launched third-party the we Brian, as Yes quarter. brokerage mentioned this

– had on mature we’ve we’ve as downloads stickiness probably I the van I on the but share this now then which and started and on network business to won’t this shipper got XX,XXX metrics we’ve and our of believe on on side some side more started carrier the just side. call, relative over We’re that, side we the great the week shipper, and think mentioned

between across and particularly So offerings that we’ll continue to for remaining long roll first asset out now shipper focused FreightPower on quarter. our shippers, early tail

done the the returns. that on intent. with And bit just we’ve get with early I asset more never of and mature of side on that but a to business so every customers we’re freight was carrier the see the absolutely booking side we’re morning business, that,

Brian Ossenbeck

the for it. you I time appreciate thank Okay, Mark.

Mark Rourke

Thank you.

Operator

from Our proceed. Jon Chappell Evercore. with question Please next comes

Jon Chappell

starting Thank you. schedule. the with Mark, morning. delivery truck Good just

we look year. since year. recall for the if XXX deliveries saying know it’s the through You your at I kind your you halfway of starters, the network end down for of about

So and of shrunk XXX incremental so already year is that by every by the positive? if it’s the reductions how as mean no truck seller and does of in big And net not of you’re maybe that market, to that the end half? a kind there’s get of back do delivers XX we you’ve already delivery taken

Mark Rourke

– reference units, capability that has replacement be or on was trucks than the half will of our Yes, have been the dedicated our as value it in more gross on still and comments side my network. your prevalent to which replacement we for us

have That’s a we the from concern. relative So to capability get to get standpoint. not want to power we to a where

we broaden pool. we’re do of some pull the equation, network that the reasonably trying that the into reach side, is reason the to have our to to levers driver What the We driver on focus is so that. on there of non-CDL can side capacity, particularly part which

configuration, easy improvement And So also we start seen great and certainly (a) an really of also expect value but the customer, business. to high task, I’ve because have the provides it very by team be which focus, much a back we a to to but is deliver the the value to a it’s productivity, not at chip encouraged going would been to stabilization away that.

Jon Chappell

supply your service kind have mean, preferred issues, are kind in you you And metering of of etc. of through month impact How and of kind seeing then chassis of you been side, well you an July that to rest with CSX a challenges the on thanks. Okay, and the BN immune happening and of July July the with quarter? etc., kind are as kind of hopeful out? or the helps suspensions shaping go that are massive some weird be of congestions and catch chain do and I throughout is Intermodal the has up as status a

Mark Rourke

with that some aligning one what of immune, by to does partner which West in our the really as advantages good that a over get us and them. give everything great value in that ability And we street, characterize deal, we but a so be we in others. within with and wouldn’t type them, on our we effective one East with be I also that’s on the try effective to ramps do the what is focus and being do we us the certainly our Yes, find to of effective for the they rail, so and spend be can are to the how power primarily what arrangement doing for to we leverage we’re

pretty we’re feeling So good.

improvement the not seeing things immune there, some you we’re some very that quarter. to on and the still mentioned but We’re we’re of bullish

Jon Chappell

at service of that’s ask. mean, kind just July? better I was than are all you mean, I to Okay. going levels July exiting I you entered

Mark Rourke

are. We

Jon Chappell

you Thank Okay, Mark. great.

Operator

Atkins is proceed. with Jack question next please from Our Stephens,

Jack Atkins

Great! and my Good for thank morning questions. taking you

know obviously their of this business you given if are volatility different some there? of for from with some what So this kind year, I of of peak get I’d Steve, the your the peak feedback Mark, around But just We’ve your you around season. What sort to mind you sharing peak Mark low your sort and comments thoughts wouldn’t just heard appreciate customers hearing year. plans base things preparations around the inventory high-level their this year you’re seasonality around from telling chain. curious levels supply your customer for and be

Mark Rourke

is their of because it’s have different maybe bit they typically certain little that the for as time you And – promotional Sure, supply Thanks confidence, chain. a a of it question. activity to of the Jack. in having reliability may mentioned, the relative

So are we our differently about of know customers some that. thinking

propensity We been because maybe marching get seasonality when then outside the typical type to also it’s the all seeing that there their and know it’s of wrong of manifest of means in places. having at some to right here, it they orders inventory have get for products where bids improvement some right and though wrong places, – reactions mini be higher but they’ll we’re and get can in in things, in they in which it’s get the some and maybe get what to inventory, not the think in, of – even times, our buyers customers it it type can, in seeing might they those places some can not it, some given inventory you’re itself they’ve even of I

same the many typical of and I between to fighting think through things now fight normal of it going through So it’s we’ve the feel a but year. been and certainly customer-by-customer doesn’t end we’re the here thing, or

Jack Atkins

commentary. call the I changes there guess Okay. the with fluidity, I railroading just and box question, appreciate makes over around sense, and for years. Intermodal scheduled comments I networks to just guess turns around course to relative with No, that that term about longer think get but my you do several interested box throughout appreciate maybe What is follow-up want turns, precision historical rail And We’re again basis more I right think the reasonable about I’m your you the maybe the just below to we to to it couple those think on that? curious levels. of way of of that’s If back next years? can XXXX or a sort think you over if long-term XXXX? however monthly or last running

Mark Rourke

what impact it’s But certainly pools it’s assessment I experiencing for. and and has would larger are a our reliability, experienced think been no we to just and and want here our do something striving relative I of been be Jack, statistical percentage it’s trailer dislocation of any any when on of in should boxes we’ve tell rail beyond Yes it. on our here reasonable at doubt that about certainly presently. time you, impact the you dwell that is to deviation standard customer there’s

can’t around set they customer where get our darn rails in So schedule the our but can reliable precision it and we pools. way, almost got railroading. get of regardless in transit their railroading get service if It’s get that in execution customers back in gating a be position feature doesn’t can we can efficient view I think not set our can dray that’s our schedule the set with consistently, we We fluid get just up get up our there. to But we that more precision to – for and better. to our what pretty network can us, is, get up, we

Jack Atkins

again sounds Thanks Okay, great. that Mark.

Operator

Wadewitz Our next proceed. with is question from UBS, Thomas please

Thomas Wadewitz

situation. market, Yes, to you the when clear of lot going know are a the that back going good kind to and wanted to of it’s ask morning. improve things labor you about, it’s not resolve like or I seems it

your if states that bonus have you’ve seen would any be think in could June, federal just in thing I earlier states in those that of that? just Are And have impact one the approach to on an seeing taken margin in I’m programs any unemployment payments. on early the of the it or with like or kind payments responsiveness the you of interest impact kind wondering is tell July. continuing more too

Mark Rourke

of recruiting when Tom, if of data our would but insight, doubt the their – on There’s – other any insight hear there. confident more of data don’t We do may that characterize I know seen we some and this they Yes certainly expires that, opinion particularly so be that we enough we you improvement share but exceptional to that you some have and trade in certainly over. programs, than to discussions give September with and us it. in I call about back when that have we’re hear as no I’d know that’s data public have that, folks will it that anecdotal that. well that’s with from or do the some in partners, certainly school We for-profit impact has some

Thomas Wadewitz

early view and on that impact your couple be would then when September So will this helpful it’s that’s off? after limited probably of admittedly of an data months rolled kind there be fully

Mark Rourke

recruiting know confidence broad professional of our That’s don’t we on reason driver the a across we of base more the see it see great there know deal the or I is our dispersion line You have from country. staff high associate very than don’t geographic you base. that on a with what is,

of you it. – why I so anecdotes, wouldn’t it’s those that’s So much put get into kind too

Thomas Wadewitz

that perspective. then Yes, it to the from is kind a ask the a kind are to that to you but Do for Intermodal been meaningful wanted guess, Intermodal challenges share know of or opportunity more shippers say what’s – part I Do shippers shift of think you New detriment question, through of but generally there a And at shipper it’s after the XXXX of point, will potential I Intermodal XXXX? strong there’s going of that. in lot And be part guess holder you hear I we of of on a take if like happens in I peak, stake want think okay. a best visibility looking to it’s what your read to this some do not truck know you to for don’t people way? seems kind be on to through at Chinese it that? have or Year tons the

we opinion of go So cycle and just kind maybe you’re shipper behavior as guess XXXX. on into I

Mark Rourke

their outreach we’ve done on would with of conversion Intermodal seeing through outstrip value that what a and as efforts Tom, intermodal the plans question. Intermodal of that seen five of to to be in their discussions experience and and stabilizes availability from earlier of presently and second if of sensitivity It COX or to for our from years because in one the whatever sustainability for part there’s and element, our me typical freight this when because the going good last have we six to our would their laid transit. calculate of let to so on have anything prior are. relative come element. We would reduction There’s from some organizations And tackle are towards bias the been any portion over-the-road, and think maybe Intermodal discussion customers here back box to that understand from surmise more out with shippers me, to first – months interest Truck the to more and level Truck excuse we to objectives or year, there’s natural going Intermodal. shippers how

two again, some would over-the-road on those suggest for opportunity trend, so sustainable Intermodal. I have systemic And conversion think more to and that we items

Thomas Wadewitz

Right, okay.

best in the XXXX? be bullish for to can tell there’s you’d strong on you potential or be pretty So intermodal that volumes

Mark Rourke

customers about I feel don’t kind are But some question, assessment. it gets experiencing of the through I confident do, pretty through to XXXX. the think we’re and comment. about then would of as any with if have some done we’d back good folks Steve’s today the do, first conversations material thinking your consumer, broad-based And as the of half certainly again particularly the I we’re the and economy, challenges that Obviously, end I probably system. I echo relates

take system, on sentiments the we those some shock the economy have I to think for to side to shock change. demand the to

Thomas Wadewitz

Right.

thank time the perspective. for appreciate it. I Okay, you and

Operator

The Susquehanna Please Bascome next Group. Financial from with proceed. question is Majors

Bascome Majors

morning taking Good thanks for and question. my

you’re it a here. time Just was guidance year a What’s contributor. was incentive shake and believe slight last one was been housekeeping a Thank drag that, item you this had through on And is comp the earnings, was, strong driver what for that’s really explanation corporate The the curious today? on the any the there? and based might running else a where other year but a guiding on year, thoughts out segment operating I big I’m different? of good what on year that you.

Steve Bruffett

sure. a fair Yes, That’s Steve here. question,

things. of couple a so And

that company and our figure was leasing that the but is our a having segment, been is in to it similar in be performance compensation a by has incentive leasing it is they’re so year-to-date year, offset which company. One amounting and of yes, largely of XXXX, other nice that as

cats within factors biggest two going theme that the but of main of that’s are those on segment. other the in plenty dogs other So There’s what’s and there. in there,

Bascome Majors

leasing whether you. it there? work that business, is much that’s on you can how about Thank more share any how of Just much that for to is that with that. cyclical trying structural think us in Thank thoughts And of duration and you or transactional? you’ve done

Mark Rourke

of Yes, I elements both. there’s suppose would

I leveraging edge tide I on job think the an their the this in has great put year. The the lift would bit, team itself the has it environment. done performance response team’s to but a a environment extra think

we So to owner-operator and solid community, offer I we’ll that to program think and so. services a continue of support the do

a good good it’s of a think capacity supplier it’s of business. our I and part So

Bascome Majors

Thank you.

Operator

have and and will Ladies participation session end and end have we much your very for conference. reached day! of great today’s Thank the a question-and-answer you gentlemen, this the

Schneider National (SNDR) 1 Aug 212021 Q2 Earnings call transcript