Schneider National (SNDR) 3 Feb 222021 Q4 Earnings call transcript

Company Profile

Participants

Steve Bindas	Director IR
Mark Rourke	President & CEO
Jim Filter	SVP & GM of Intermodal Division
Stephen Bruffett	EVP & CFO
Jack Atkins	Stephens
Bascome Majors	Susquehanna
Ravi Shanker	Morgan Stanley
Ken Hoexter	Bank of America
Jon Chappell	Evercore ISI
Todd Fowler	KeyBanc Capital Markets
Chris Wetherbee	Citi
Jason Seidl	Cowen
Tom Wadewitz	UBS
Scott Group	Wolfe Research
Brian Ossenbeck	JPMorgan
Bert Subin	Stifel

Call transcript

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Operator

00:08 Greetings and welcome to Schneider’s Fourth Quarter 2021 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. 00:27 It is now my pleasure to introduce your host, Steve Bindas, Director of Investor Relations. you. Thank

begin. may You

Steve Bindas

operator morning, you, and Thank everyone. good XX:XX

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

during Mark our which Now, release. referenced In I'd G, to any made as the by to call XX:XX call includes measures like expectations. of the this statements directly Our remarks which plans, forward-looking to over pursuant under any filings, of include uncertainties most as today's Schneider of to The in company cause laws. call update risks results required prospects statements to forward-looking are disclaims not GAAP and actual and could earnings urges Mark? and Harbor risks securities date Safe release, and those risks our that in purposes found CEO, XX:XX forecasts, except measures. will financial duty SEC XX:XX expectations, uncertainties future identified the about law. of a involve reconciliations to can current statements reconciliation Forward-looking Regulation the review for discussed including provisions in addition, most constitute but Form Schneider, our Federal XX-K earnings be comparable All our limited the today's to statements differ applicable recent to such from and investors the materially Rourke. turn call non-GAAP for

Mark Rourke

of each and taking in in we including of warehouse morning. technicians. will performance new been XX:XX XX:XX them. strong. hello, maintenance into freight the commentary segments call quarter insufficient of a and momentum you remains our The to Schneider and professional that has remains in are this solid joining market busy the on in fourth general and open dialog I It the terms with our the everyone Thank thank the start today for Steve time, Year. demand you, same availability and fluidity year challenged resource driver, the New At network the

Manager Additionally, and rail strategic acquisition that On what Systems XXXX business point, added the terms trucking or dedicated his joined this us and expect Jim on that them, of with and of insight as value has support call specifically in morning, Schneider, of our customer we our offering. opportunity to regarding we we community. role have partner Jim XX:XX our change will of growth Midwest Filter in offering. Logistics and additional General our offer focus announced MLS Western and Intermodal Intermodal in a a alignment strategic for

performance provide then Steve on Bruffett review margin targets on will segments. our share Steve an per across into to XXXX insight XXXX year in and insight our guidance earnings guidance. turn the financial our expenditure of quarter Finally, We provide performance update XX:XX into completed net and recently full our capital for will long-term commentary

our conditions throughout it. and The I'm our supply a I and chain to market fourth of record capacity before committed associate customer full our of addressing transportation multi-modal a grateful customer in needs. comment to quarter and $XXX am diversified necessary our Schneider customers XX:XX leaned XX:XX to highly $XXX inflationary achieve talented results is the integrated getting work more addition, been into wages, million meet result, our respectively. of way than to aggregate demand the of that year all supportive multi-modal In higher cost introduced These and increasingly expect who platform insights valued and appreciative results to stakeholders XX:XX of opening with other enables with a normally to performance the visibility provides Freight approach in the equipment that our year we reflect us to access, create million and in broader also have by strategy resonating earnings community. you the premier base costs base. in delivered to their top-tier Platform in needs enterprise categories. consume as Power Our being the time So can support and adapt questions. variable do your enabled on the business

MLS our nearly organic driver of new strong of Growth in year XX:XX X,XXX the recognition off in the pipeline While that of new wins. to price in inflationary growth team locations costs business to first business Asia momentum yields, renewals us Dedicated network and of do we in we company was where January allocation productive strategic X% to of order In of most business bringing most great overcame count XX:XX the down end. it of people and truck across with our on drivers dozens network from rail And issues last take in Importantly, result minimizing dray configurations. to associates take increased work of per period. in revenue delivering stabilizing through have could highly new are cost XXXX quarter, our allocation type grew turned start by driver most address in XX:XX and supply per XXXX and Intermodal, the intermodal the larger and shifted we development is deal chain we new our resources to organically of The into Dedicated segments. by preferences working increasing revenue week growth great guide value don't they of by driver our containers be overcome leveraging our year performance, acquisition, use to we're of and find expect we our Dedicated the in XX:XX count they our year-over-year ago. XX% the we disciplined dray container per over brokerage effectively December and year-over-year XX:XX dedicated great year over robust to professional team on remains fleet several new offers a to challenges intend to additional year continue customers of customer discussed existing at higher community Combining the is said, alignment to by from fourth our and same our XXXX. The of tractor ahead third-party our indicated Dedicated satisfying. containers customer business assets increasingly the from XX% associates. That -- Order quarter. fluidity business turn by customers units delivery delays XX:XX last and the expected rolling a have configuration, driver and The hundred our network as and and XXX as to to efficiently. partially our the value managing quarter. dedicated network the a diligently as than

performance in of at to Jim Intermodal full strategic the container about to X,XXX our growth In noted year margin XX%. for finished quarter, containers talk XX:XX in net the for XX% year more year. full our announcement. Intermodal in recent a or positioning containers to growth X,XXX XXXX I'll fact, for bring of Jim? nearly the up bringing we Now,

Jim Filter

XX:XX Thanks, here on to more recent Good I today glad morning. be Intermodal Mark. am share to news. our

plan growth Intermodal Pacific transcontinental service friendly business as to capacity carbon grow market Mark of rooted is we faster X, with and XXXX for our the by and our Intrawest strategy environmentally January customers. goal indicated, exclusively exceptional emissions. Our both double and our partnership environmental Union by our As value Intermodal our business partner goal XX:XX to expectation to demand than announced market XXXX. our This plan with to of our Intermodal for providing increased reduce aligns in to

well asset-based We XX:XX transfer a driver partnership efficiencies, solution and in with bottleneck compelling customers, traditional have combination CSX proposition PSR and will with largest Chicago, model. number driver with the the Intermodal North Schneider company will destinations have execution. the company connections own XX:XX the our serve Intermodal freight. differentiated turn UP for Schneider XX:XX on the increasing to containers differentiated add with transcontinental creates of driver our chassis. a the UP, summary, CSX will Pacific times this fleet of differentiated only more and our our direct any especially accentuated in through This a which through in system. value. for our carrier and dray with established the combination value and coupled be we'll scaled Union position Intermodal Union This Pacific. We increase both company-owned American pairs chassis containers In customer dray commitment improve shareholder only and delivers hauling Railroad the we freight believe be asset-based carrier will offering

are ensure transition as seamless a diligently such as way We that in our working business. is, is to and possible done customers our to the

to partnership be we and opportunities XXXX. the accelerate to and like We our turn our Union fully January the value back I'd for to with to to are Mark. more transitioned our long-term XX:XX will XX:XX Pacific As by realized I Union creates closely growth and of work enterprise. customers mentioned, that, Pacific And excited X call with for

Mark Rourke

and to his our And commentary of XX:XX I multimodal will Steve with the outstanding finish Great/ before Thank outlook, our the the turn contributions Jim. on financials Logistics. up I platform you, leg third of for

has revenue million. Logistics connect prior For cresting achievements million order XX:XX quarter. the approved XX% Power our Logistics as segment economically XX,XXX to as carrier me our and Freight of first-time tail XX% the measured growth in For by the driver out capacity of Brokerage historically million, The $XXX brokerage enabled long for growth Two finished that's $XX number that most our the nearly revenue a which carriers. in was to with been small and more carrier a year-over-year earnings quarter profitable the of year-over-year to volume Schneider as community year. history, business. truckload and largest surpassing the digitally finished XXXX, been carriers of notable $XXX under-represented year, nearly represents XX:XX in that reach XX,XXX stand of us our segment double at

it over in with I'm Steve what's pleased encouraged While to Bruffett. I'll XXXX, by Now, turn I'm ahead. our XX:XX even accomplishments more

Stephen Bruffett

to great. Thanks, each this you morning. joining for of Thanks Hey, Mark. us XX:XX

the of quarter record only fourth record quarter earnings adjusted consecutive represented earnings, not Our but earnings. third

In XX% throughout to half For XX% of meaningful represent fourth our segment in of than more evident XX:XX Logistics are as complementary multimodal posted segments benefits in margins. earnings all to the quarter, the compared of XXXX. combined or fourth as the increases platform in and XXXX, and earnings Intermodal year-over-year quarter

fourth XX% the earnings progressing in dedicated In year. $XXX targeting of year of comprised our quarter Truckload segment the revenues revenue XX% further portfolio addition, XX:XX of For higher of and of million, XXXX. adjusted in or XXXX, is reshaping the the XX% year. than prior we're prior versus full Purposeful advancements

the XXXX. first over In reflected crested addition, fuel mark revenues $X for excluding a time and surcharge increase the XX% billion

acquisition December to of MLS million capital that to allocation was multiple MLS aligned the price were quality times. and EBITDA our our $XXX so and find opportunities team. all Deal the look on forward X of well an growth criteria cash Regarding purchase disciplines. structure closed represented the that company we pursuing approximately XX, profitable strategic with pleased with We XX:XX

quarter our of be first noted, As in results XXXX. have of beginning as reported part we dedicated MLS the will operations

there closing, Given our no MLS the timing income of XXXX impact the was statement. on

accounting However, the XX:XX flows sheet forward-looking balance now acquisition. our contains of payment transaction and to purchase our cash the Moving our statement the for for information. initial reflects year-end the

range investments, earnings guidance market a as diluted range well-documented $X.XX to of $X.XX and Our initial adjusted incorporates to is there also and sales inclusive same the variations be transportation in Also, XXXX although, XX:XX context basis. For to equity quarterly gains our to a further based year. the guidance freight is a continuing momentum on our is likely the $X.XX occurring achieved similar none. the year conditions we time, adjusted while benefit This begin EPS the asset of we are XXXX new will $X.XX earned throughout assumes XXXX, our the on full range EPS year guidance in those guidance, MLS year-over-year be guidance share. inflationary for the This contained we at the XXXX strong have that assumes of pressures of our expect from space. on cost

long-term XX:XX contained Our annual review guidance margin solid and Mark XXXX is $X.XX above to levels achieved our segments. of portion mentioned of of from our the MLS. growth core in $X.XX coming in strong targets that earnings growth a XXXX for

provide update. So let that me

to upward midpoint over target we're revenue range For the by XX% Upon to XX%. significant our nearly our target past prior points, base. The plus which the to Truckload segment, we the the front opportunities of was our For moves in given XX% XX:XX range basis reviewing is years moving range the to target updated $X of was This is segment, couple see us, the XX% to progress XX%. the prior XX% range XXX Intermodal XX%. billion XX%.

midpoint So by and increases basis of increases points XXX the basis this our key the by XXX for points upper-end growth component story.

in growing on couple shaping we're portfolio. profile technology. hand segment, to and dollars return earnings the of consistently are with grow we've These our the X% the ranges provide the reflective X% also attractive leaving of the the capital past in over XX:XX revenue, approach For investing the goes an of is years hand range that target Logistics by strategic of they updated as to top-line progress made while

and XXXX is growth (ph) for $XXX fleet further to focus million. guidance on net Distant age dedicated. the in on improvements with CapEx approximately will capital tractor framework, planned Our the investments allocation our

carry to equipment digital and to by both key complements and In up Intermodal open continue growth on capabilities earned and further a intend and to So of also with of call mastery dedicated, broaden to strategy to a in partnership advance in constant your focus focusing shareholder this XX:XX Platform. including will positive hard deliver XXXX Power growing our and Power now externally, portfolio. XX:XX Freight themes rapidly profitably the into offering. technology, with we momentum our plan on invest multimodal our all automation, We in Only for value of grow Schneider closing, questions. and lot internally our that, XX:XX we'll our simplification, trailing our are investments support We

Operator

session. XX:XX comes this and we Instructions] Stephens. line [Operator Ladies first Atkins Thank Jack at question-and-answer you. Our your with gentlemen, will proceed question be the with time, of Please conducting a from question.

Jack Atkins

and on quarter. Good congrats a Okay. Great. morning great XX:XX

Mark Rourke

Good XX:XX morning, Jack.

Jack Atkins

one I about that is you partnership the East look I tied sort XX:XX with of your out this because about couple the it's strategic it of the So more West guess broadly, years to of that go business with opportunities portfolio? guess, us stands more today. on for of your maybe next as can kind you take over shift of share you I is or of rail new think And between maybe Mark your sort Intermodal. this is help about improved or guess to UP? economics it balance And current and Jim partners, is as want more then to Intermodal where market today

Mark Rourke

product, to pleased Jim can XX:XX some get it's effectively. your leverage to weigh very dray our with as our the elements Intermodal offering our of but East Well, been Jack compete in over as and I'll where of to really really question, let great effectively discussed, from questions growth great in ability and -- road convert the on we've the here well, we we've

in We growth have in we felt West. have represented that our the under been profile

so, this have of for unlocking think great we transcontinental And potential the really us. to think point is that shift is front we unlock what us strategic we connection in growth a

between growth and disproportionate East been been I in East. And last the think, it's several quarters for and balance so more our get, ultimately to we'll West to

Jim Filter

can the then connections we XX:XX choices, because more we're value we're with there the CSX. more the the that all our improving dray differentiation, the creating CSX company and I asset toll company UP, together, customers potential. greater fleet, is chassis private driver new we'll company connection, growth our and put private largest way have lane by Yeah. including will to And leveraging these strengths direct Mark, And leverage unleash more be only only will our we're with those expect we get the on UP you for that creating that

Jack Atkins

service And BN if the Pacific, on from I There a That's around couple yourselves. XX:XX guess Any Okay. going Union be help make announcements volume in to the would concerns around you have shift to to additional And that I that their some investments of improve just network? all given potential follow-up to issues to Knight there and expect the been maybe both hear. will Intermodal, on partnership network great velocity? UP a could.

Jim Filter

We've direct that with shared add Yeah. actually more direct UP we UP that XX:XX capital more connections. have volumes see the our you onto comfortable more with plans, and may CSX and lanes, as we're volume lanes their

efficiency their improving those two rails. of be we'll So

Jack Atkins

so XX:XX much time. Thanks the for Okay. That's hear. to great

Operator

comes Majors and Please your question question. next thanks Bascome Yeah. Majors of Susquehanna. Good the with XX:XX Our questions. Q from XX:XX for my taking proceed - line Bascome with morning

read are thoughts On from shorter the how contractual you seeing was bid mini and one prevalent not competition, versus one seeing bids or the any brokerage could last the that the way Thank on an early non-asset season, give us in way contracts And you're season? year? on bid duration how you.

Mark Rourke

Yeah. process year. calendar the really in XX:XX there We're the for early

most everything think, bit our involve discussion. through discussions I ensuring a characterize I of more bid discussions capacity perhaps would working and the around customers into throwing versus direct coverage

think more from benefit learned that working the on shipper both and the long-term over I together can we've carrier arrangements. time

would we're highly and with chain engaged the Jim, dealing really so early those But, getting inflationary And also through. a solving other problems. we're we in fruitful process, customers any supply comments through expect costs in the our but Obviously, all are commercially? season

Jim Filter

XX:XX Yeah.

networks to and seen revenues in create specifically out solutions what and with those multimodal seeking are they They're providers stability supply are address their chain network dedicated Only, Power conditions market to challenges. not so those service have have the the change and offerings productive customers. ability within discussions We our we have to in looking scale, a the then Intermodal our scale integrate specifically for that

Bascome Majors

follow one-way your mean, that, material that a stabilized in up I shorten XX:XX contract any on way to the or of last out to duration and go bit? has started did typical year

Jim Filter

not We shorten. seen them XX:XX have

longer-term are In those engage some customers discussions. fact, in seeking to

Bascome Majors

much. very you Thank XX:XX

Operator

XX:XX proceed question Our Please line next comes Ravi Morgan the of question. Stanley. with your from with Shanker

Ravi Shanker

morning, differences giving the or of just get be XXXX you year, half, but price color would half, helpful. conditions business, through you're any second trucking you could if kind us that Thanks. how, characterize evolving specific any see gentlemen. of not first kind color potential in for really XX:XX Good the I are between Thanks. the guidance

Mark Rourke

Yeah, and to a us lot early for XX:XX the cost demand supply inflationary customers Ravi. from provider support the and supportive. consider will I to have is year tell their probably would incredible for And It and again, issues across feel they're full we're little I a the and into on price still of market chain feeling a that, constructive as have total them carrying the you we our we're certainly are contractually. pressures supply prevalent. And year. momentum feeling so that personal and had the the a

going So still pretty we're full the freight year, to it play we for conditions to all that out. favorable would expect has again, but

Ravi Shanker

or to XXXX how by contributes EPS? but much Steve, anyway? two follow-ups sneak can MLS this, going actually Understood. targets, if also, happen primarily that switch missed that was driven did actually quantify sorry. IM you, The I XX:XX the new you was if And I sorry to UNP And to

Stephen Bruffett

Okay. XX:XX Sure.

Intermodal update part we target our margin anyway. ranges would to of made first this The have your question,

growth just dollars think earlier, the that more to the that revenue range earnings really UP as through I through and pipe. enhances potential Jim the switch growth coming the said reaffirms

about. of magnitude that have is the the we're that of the some contribution make we we that's to of there, provide the could and on paid about order And quantified people provide the what MLS so but multiple inferences within that that's one. we So that all going level did not detail

Ravi Shanker

you. Thank Great. XX:XX

Operator

question Ken with with of your next Our XX:XX line America. proceed the question. of comes Bank Hoexter Please from

Ken Hoexter

It's XX:XX Hoexter. Ken Hey. morning. Good

on investor talk margins. about looking peak bit sustainability concern the structural at structural a pricing, to going or I at factor of the market? that loosening is your looking on a that that guess, our at if pricing margins, we -- Just this on is gain view some -- maybe the see shift about up we're after yet you're maybe of trucking point, on think that a

just us that maybe here So walk shifting is in what view? through, your

Mark Rourke

is to XX:XX higher portfolio of Certainly, network. shift dedicated Mark. Great. mix Thank we're you. seeing in our some Good morning. a versus This

of of that design the because has by Some preference our driver with community work. clearly, type of that for

some existing our So providing longer-term I been we expect it. with have value, we're to customer that portfolio. to customers base, series great would but both are of contracts a think Those into our also and business resiliency introduced new

the contract side, there see And and a clearly our lane. working in amount network on continuing disproportionate that business. we're still really trucks so, of And We're growth provider power the on forward largely would like we as stabilizing we that going count a XX:XX on well.

important. So around we're a the stable, the do although find that key certainly bit and edges customers they play project we in spot support more work around our

as looking effective So side that I the at the mix value in us earnings provide although a our helps marketplace. look of retain think continue in and forward, we smaller, think to highly have we at, I business will network truck least business

Ken Hoexter

but revenues, right. the all with not fleet plus or growing yet down Amazing network XX% Yeah. in XX:XX

So that. I get

Now lot the talk a your platform now your question and to outlook that ability kind hands-free? scale ability grow grow technology with little a technology scale and on a for revenue. highest brokerage right be Maybe talk my and is you follow-up, about and yet business. mentioned What a Logistics the budget of we to Steve digital mentioned dollar with bit. that with about and just

there? opportunity the talk bit maybe set little about So a more

Mark Rourke

is the in Great, because are have asking question you appreciate and there robust technology spend. we still lot Ken. I appetite very XX:XX a There a

how to incredibly on do platform When our are for fact evolve record optimization I'm that's that management, decision a But our Quest, been. source and years job year In our support models, position to with networks ago have unleash data, better a trying a presenting of could this and we services the of our will entire our what to another truth to people can to single in outside -- that spend of think effectiveness XX:XX spend. best-informed do just about we we getting they others it's started really strategy. in us, technology out, we -- were putting XX trying the the we thereby evolved be of long XXXX of make first all us ago important to we're a ways decisions. revenue data that for on What's in started in to their inside be because get to pricing, as have talking

We to chain. automating intent for them outside of taking and and our data they whether are value be now in more insights data number the of carriers those partners, presenting digitizing are customers, points our entire a

to what's foundation that's partners. exciting it we're foundation key now, the great that a our for We that presenting So us. and trade had for now. we've And taking had while

around hundred over where orders are any of XX:XX where think, many that's I our now. seeing automated we're Intermodal think in the great same investments and tender way having progress the not on acceptance business carrier brokerage several people so We're And our and automation, side through particularly seeing all freight. dispatch. day business, It's touching XXX we're orders orders, a our the or I XXX that

process whole The automated. touches up our when driver dray the before person has first been and that time customer at a shows the

a same without grow those can and count that's growing that business position are level we our FreightPower focus we think our what unleash driving we're really and things on see cost our where at the is when towards. So the Schneider the network, that's people

Ken Hoexter

want on the got XX% math want sorry, you a to to just this I XX% sure just XX:XX -- mentioned got Steve, I to range, make That make numbers Can XX% I I right. sure follow-up said right. you XX% get Intermodal, right. I a quick question. to just I'm

XX% you're your did quarter. just upside? that to wanted or You have targets is over-earning you're understand, this I saying

Stephen Bruffett

was number. The XX%, XX% to quarter. is annual XX:XX the XX% an fourth

Ken Hoexter

a So okay. lot XX:XX much. Thank time. you it's of the Appreciate very seasonality,

Operator

line question with Evercore. proceed XX:XX Our next the Chappell from question. comes your Jon with Please of

Jon Chappell

I question, carrier you. which crested want the for threshold follow seems I pretty a you. hit it's the last FreightPower Good kind mark, everybody. to Thank XX:XX you significant platform on think of morning, the Mark, XX,XXX to up an scale, important have

at Logistics want curious Just the scale the upside that higher? the you've platform scale, the margin that top just hasn't there there, advancements obviously up, certain that now, least to with range you potentially would a could it be I moved of grow the with with why still think end had understanding you and have exponentially.

Mark Rourke

Yeah. XX:XX

Power Only capacity regardless shippers we carriers, and separate carrier asset that the in services. market certainly with brought capability demand we our with will have also on get can so as we're front also while with help benefits the brokerage generate and but on market that benefit think large I our than our generate more end to much this of that of those we of bear are to connect our Logistics, to overflow you at an now some start overflow into factors, efficiency particularly capability business we smaller look strategy any And our from model. seeing we're of the

the benefit we resilient a the And And think that we business more an approaches, I believe and model capability infrastructure, of to so we than business that's business regardless our have we have thrive that just in overflow really cycle can brokerage so and the little withholding that some in. we're the be healthy to asset-based other of logistics them. that thriving a from but want than assets might would a we think different bit be the

Jon Chappell

Jim I move working a From know for the a little rationale bit follow-up, as maybe perspective, And you're and UNP for Steve, you long-term then said transition to well. with sounds XX:XX your customers. strategic Okay. my great. The obviously short-term

already and sounded pole you first of at put they're past, the move to lot certainly a making the totem it from like into not to your transitionary that gave service up. move heads this Steve, raising How for recent kind can maybe to from order going there's the expectation You're former carrier? transition others you be what bottom year? of be as and from may baked the comfortable guidance very that existing make be the of in with carrier your this are impact very little And hand the

Jim Filter

Thanks. Yeah. XX:XX

resulting that So issues channel happened across most the related the that and labor of to year lack issues speak to of the were while of last I partner, can't chassis. industry availability the to other specific

not and rail So control to better to our percentage our are -- also the us us interest Steve? by It's to that our in higher for there contracts. an grow going no live partners as our companies' Union drivers well. company trade other so destiny and the ownership I now model are of our done and out lanes own chassis Pacific unique our those best right us expect to to position business out opportunity both is

Stephen Bruffett

the quite solid It's that one year. a very till have captures think I XX:XX this it all of that game as year. transition go this plan, we that that We is happens through not well. this a process of have course we everything in if year two with and wait and we day, XXXX through feel the go that January a we be our will partners through able of in as think West execute we outlined there I to

Jon Chappell

and Mark. Steve Thanks, Okay. XX:XX

Jim Filter

how have with our XX:XX benefits asset-based Yeah. from and we customers the The at And positive. feedback the said railroads remain benefits time the was with about this did we're our explain intervals what I was received what is that they seeking spend scale. talking of across when we overwhelmingly really many start customers we impressed before same the was, us diversifier to providers rollout

are rail unique grow that need, as this result, seeking have we to pairing us. customers so, a with addresses customer and this And

Jon Chappell

XX:XX I it. exciting a Thanks Yeah. appreciate sounds like move. lot That an Jim,

Operator

Capital Todd next line of question XX:XX Fowler comes from Our with the Please with your proceed KeyBanc Markets. question.

Todd Fowler

Thanks, good Great. and XX:XX morning.

from couple by truck comments years, next So you much the just the different mix are targets, with XXXX, on the how that's cycle, so around intermodal versus And ranges contribution clarification, the doubling of then new the versus over the for are the business potentially the cycle, do still low longer-term Logistics? do ranges, you Intermodal of you points view high? how versus see just the over in the a viewing

Stephen Bruffett

part There's intend cover vast of Yeah. is of of can things our we do the happen execution changes time, periods is margin structural freight out enables structural of at within in the We ten lifting to as spaces the outliers it. things always ranges shorter eight in there's how cycle, we but least and I'll we some and of of Steve, majority that kind organization first the This XX:XX of these feel think that we've as ranges. like do these to that. compete years, take which some well within the made that performance

capital feel so, And we landed in again a that place forward pretty and we've in go confident on that enhanced as return improving provides good time.

Mark Rourke

which structural drivers as our thought that other much not of meaningful our too environmental a there we of what tailwinds, to I the there. back that parts centered only the coming question. condition is intermodal, exchange but side a valuable in then also our product, two in future converted of can has couple truck to the great and growth the number XX:XX Intermodal, partnering maybe other because Certainly, dedicated shaping efficiency we drivers is around strategic of over with on rails have road only think a convert and not about with a mix strategic is portfolio And dray -- back current our does growth sustainability. freight and value

the as growing history much growth. segment being So largest seen the that first you've segment certainly for in being to our time Logistics. we then tailwind our see And in fourth our fastest a quarter, very XX:XX and

don't three are those any capability growers with we constrained service constrained of offerings on we pursue and vigor. will capital three be primary feel so, we them those And and happy or and would our all

Todd Fowler

XX:XX Got it.

quarters That know share realize, or percent a any me on thoughts then helps. earnings and fourth a cadence for of shape excuse expecting together XXXX? slower you I the Okay. the first to of thoughts again follow-up, and a And percent kind do lower on in XXXX? the was Any quarterly in of to of quarter. year, you're you the how bigger just care typically this come the quarter kind it

Stephen Bruffett

sit We is much today. see the constructive we year interesting pretty Steve. out. where year see environment plays be how from It'll the a XX:XX throughout to This

we specific think through this coming at carry earlier, mentioned of momentum that not have offering Mark point will year As that we but up time. and quarterly a lot into I the trajectories in

Todd Fowler

Yeah. XX:XX

time Thanks for morning. Okay, Understood, this the Steve.

Operator

question next Our XX:XX with Citigroup. of comes from Chris Wetherbee the line Please with question. proceed your

ChrisWetherbee

morning. the Thanks. Intermodal topic Good just on Maybe them a Hey. here keeping XX:XX minute. for

XX% out longer range. at ‘XX guess target of end I margin, is I about think a the your finish term to you which guess or XXXX, high As we

or us volume unwinds we how you just want be goes As otherwise out and profit? you better, service understand to I to expect year, utilization a get improves negative and puts but a revenue business kind us their maybe Any up, we're of the the grow? I per from assets you XXXX understanding it standpoint. flattish maybe so to with Intermodal of a part load that then to be help to rail of lower margin of make takes -- you kind would what that kind expect some you go for can of next be can into the bit margins, Would think understand to kind sort the help of I of might at just guess a that dynamic would great. looking the to give a sure maybe

Mark Rourke

getting of Certainly, our the standpoint productivity question. Christian. Thanks asset our Great, turned. the XX:XX the to quarters several boxes suffered relative from last over we've for

of couple got do going time improve. And that expect to on a things there. starts so we've We that over

we loaded. out because the in benefit not second-half more have had half the second in that the of of also grew they the boxes year We came full

values more And on boxes full and be we'd we other we more performance also the to growing -- believe our growth grow start for then only can placing about think assets talked to of into done our we now starting our also that margin offer about, that items we'll that through we do and X,XXX have not to year, and to to we're how and we of that dray together, extra we've that a those our business. like everything more destiny this little all think year transition deploy ability but UPC. bit talked opportunity Put And that we of the what the contributed execute that as some our commercially environmental the the with control so we that with by through make across have that of we overtime non-competitive and don't us think our leading decisions the that lanes service gives we the have with products here, the but those network will into dollars we have and well. control more volume, can earnings with Jim be

Stephen Bruffett

Yeah. XX:XX

I that, past in that our think we've made to add on just progress several the years tremendous Intermodal margins. over

right of We and accomplishments expansion makes the So made business, I margin Intermodal, think emphasize there's we've switch different we growth parts behind grow earnings can margin. growth. that but where kind volume Intermodal, with towards can line think more degree stand in behaviors I two in and we've we grow our maintaining made toggle ways to the on to growth make the And sense it there. are of margin. expand top can might you that revenue given you now goes dollars, progress volume And the of while or different revenue

ChrisWetherbee

just gains maybe to gain helpful. the some flattish. on that. perspective would XX:XX be ‘XX on costs segment, then Appreciate in the Okay. about and if get for you very That's how wanted And think Truckload

the experiencing in Looking This a that adjusted seasonality, play quarter, you're slightly the a if then better and that, at how want to you understand maybe expecting the can XQ. bit a like ORR there we worse, go in cost fourth so kind so of is versus availability, maybe is I gains driver be where all I XQ said, environment XXXX get of should sense year into we typically, the have little truck factors to out? sort of

Stephen Bruffett

XX:XX Steve. Yeah. is This

were there gains quarter, the we point year providing replay and I third fourth focused were quarter mentioned tape if in really at You ‘XX on time, full the from given to which was call was where guidance that earnings of our we and half what that's on in the I third, what calendar, be to so out. played third would into and fourth they we that as indicated got about the of fourth, quarter in we the behalf gains basically were be expect

issue. difference that you're of and cost margin there, is XXX% was in gains difference more not sequentially the referencing would the than by in I So say, driven a indicative

Chris Wetherbee

a Gains ’XX? year-over-year on are XX:XX for flat Okay. basis

Stephen Bruffett

XX:XX I'm sorry?

Chris Wetherbee

are Gains flat, [Multiple XX:XX Speakers] yeah?

Stephen Bruffett

full in be range full-year to XX:XX as we For ‘XX. XXXX, same expect the year

Chris Wetherbee

you much. Thank very it. XX:XX Great. Okay. Appreciate

Stephen Bruffett

Thanks. XX:XX

Operator

Please question the Company. question. Our with Seidl from Cowen Jason and your comes proceed XX:XX next line with of

Jason Seidl

a you, Thank operator. morning. wanted I here. good XX:XX to bit Gentlemen, on focus MLS

basis, seasonality your does how business? As we could talk compare little particular base the on how tractor, us start to does have? quarterly might it you modeling that about a a could bit it Also any you remind per revenue

Mark Rourke

performance stable morning. of our range potential tell different, all so that today it’s the it’s ability seasonality the into year-over-year. see what -- relative in is more it's Great. bit in Just it. and stable its business, of dedicated based would to injected have financial upon XX:XX that more growth business have I we a not pretty you Good business, We the pretty think we

Jason Seidl

XX:XX Okay.

bit a grow. about You the ability talked little to

a and but in is MLS pretty got that a imagine Now, I want model, particular something it's is this on. it in exceptionally turnover, to concentration low day focus great which high one was market, particularly end driver age you can

do and discussions? already in verticals into how think So growing you about go you some you can other are

Mark Rourke

that great particularly markets, have think play number collaborate do a again, around particularly we're running Yeah. business identified and that jointly international XX:XX and a have can some we different of on separately, and geographies -- places them presently they largely they on and Mexico. we is there but then We

some terrific to driver and have not incorporated a expand they've do their geography. model opportunity we take So there expand is retention vertical, that operating and they learnings but think ample into model, only

Jason Seidl

are Those my the time two. XX:XX Appreciate Okay. gentlemen. Perfect.

Operator

XX:XX line with Our next question Wadewitz UBS. comes of proceed Please with question. Tom the from your

Tom Wadewitz

on of didn't Steve, on capacity perspective I I kind XX:XX you gave some framework adds. hear guess a comments on Yeah. Good CapEx. some morning.

So static, think on the look some net we MLS, think tractors network at assume in I how I aside should you for should is across we how -- maybe aiming if how in about dedicated much offer XXXX? but setting for in you're what and you adds like, growth see growth fleet, wondered when look thoughts about the could container Intermodal should business, we

Stephen Bruffett

would XX:XX the grow the to Yeah. dedicated anticipate space segment. be in And you've like being we a areas on we We do marketplace in is and commercial -- We expect capacity several lot of that where and vast looking added. would truck specific. the hit key to we momentum in have without would of strategic the Truckload are hundreds clearly, invest having success of in The we units the feel a in overly be to that hundreds and that continue. majority that

go lined to trailing add capital thousand to some the XX:XX several equipment capacity in year. up we got through we've to that. The expect So feed Intermodal, as continue of we

I and through around, what's of year move deliveries. on Some these and of we will those OEMs numbers see go timing the as imagine the with our going

variation a So goes there it. little with be that can

specific point overly into say counts container safe expect to grow continue at that unit with our but So count we to investment grow XXXX. to that this through and we're we as not being move

Tom Wadewitz

rail and how I if you quick heard XX:XX Okay. you ones improvement that year-over-year improve quickly talk timing And haven't volume do such then fluidity see really that the turns get about can. follow-up growth. you I for guess I two and actually

you. should Thank going if offer volume very, to along in volume in in And terms plus tougher then at or logistics? wonder quick Logistics just growth, are that. we like of chugging you could growth comps strong, growth XX% XXXX you I consider thought a So has in very keep on volume been maybe

Mark Rourke

XX:XX Yes.

So these I'll gentlemen. to then hand out back it start and

that as disruptions. course, improvement of that, our unload improvements quarter. The second first So But West provider through seen and in times a we to what is our in ability providers fluid were with we've go we've we still network. will we as and their customer expect the networks some challenged our seen number area late, at Eastern see are is their the of current said of made and

Stephen Bruffett

XX:XX Yeah, Tom.

that continue that's some a we've to our growth portfolio with in to Logistics As Power our segment. emerging reported capability to Logistics it And we and capability and see growing relates our business, driver. our there more Only as added

volume comps an a do I obviously, growth continue more that proposition don't we got to expect have exact that. also we've would driver. but so with value to get to a share difficult, And percentage be allow but I'll that us keep believe leaning into you, we

Tom Wadewitz

XX:XX Okay. Great. the Yeah. Thanks for time.

Operator

Wolfe question with from question. your Scott XX:XX Our Please next comes with Group of proceed Research. line the

Scott Group

XX:XX thanks. Hey, morning. Good

Mark Rourke

XX:XX Good morning, Scott.

Scott Group

guidance? you XX:XX can Steve, can the be Given improvement segment year in end this you where or what's this talk about and Truckload margin? you year environment, a think that the margin new of upper is at should the

Stephen Bruffett

into carry a coming we've Like the momentum of lot Sure. XX:XX year. we said

think, Truckload, once have is and resume in network particularly opportunity especially get the side weather whatnot. I past So, of quarter normal first the and events helpful. that we And more operations, type we to

growth we've that think be business, saying I side like in the to productivity of continue start and just side we've XXXX. then there the been dedicated overall top the through of to line solid will which in And some margins. to margins see greater the in develop efficiency some we'll helpful and expect business, network achieved

we're achieve year. what set think So is I achieved and this levels our in that we've continuing to at the wheelhouse out

Scott Group

Okay. some How cycle? this it logistics Only do can you frankly, give a asset-based a freight seeing ask And strikes to eventually the Only. about color one sure big XX:XX more business. Maybe over you me how in if years Only next such Power truckers we just want directional I'm Only into Power Logistics? a how think growth all not this and this and performs tremendous of of go business Power then percentage that on And are as think just the And couple really Power of downturn. you is about another I to through

Mark Rourke

Scott. question, Great XX:XXYeah.

our business, particularly been one about Only, think bit I the of difficult, a one is a capacity network world today's in more network. it to surrogate on way Power longer As serving that way haul has

customer standpoint is choice in been align after we've lots to a offering. growth when successful from great a Power significant serving to the of is value it there pretty environment in get to Only very a the carrier us So this and with

as may to does it box to a confidence go So that also of to do, that to direction well work easy access to much other have And type as of that's their subside in whole own flow. it choice. getting type me so we've different lot even done the there opportunity freight, standpoint, a if or equipment from as make more of different of in a that and well in going to I to orange our doesn't the offer gives XX:XX this introduce play market a probably carrier the market trouble environment think value a carrier start a certainly great different

of been that with what cycle we're in. have we customer what able pricing care, so I accomplish regardless of our business And to think very applicable is the decision the science around to the pricing

and things be the that has So be in obviously think do it general, but adjust cycles will through think this adapt brokerage resilient I we same. I to, like sure out has have to some to to the it's there'll pretty and proven just opportunity the and I'm

Scott Group

pressure. I when tremendous is don't it, guys surrogate, understand XX:XX you everyone's you but the use under Just utilization know I word so report

loads that sort or asset improves things utilization based make as of sense? brokerage calm loads so slow? in Power And Does and don't in not think you down, Only trucking that and

Mark Rourke

limited don't we're thought. I Yeah. XX:XX with that think

the Only. both. My but to on around certainly can of I side, necessarily expense Power think the truck centered comment productivity and come don't I think surrogate has I the we more utilization if improve And we yes, be sitting offering it do same we I yes will freight. had think the location. trailer because orange have say Power saying pool another that of my in would in We network, still can because trucks our thousand to Only at

our And way carrier base Scott. brokerage with we that's different so, customers a we've traditionally business, been base growing had carrier in seamless that while really our able served to than a the support

but certainly back forth a think to bleeding will to I be of binary a think don't be this yeah, I and it's that. degree, there So, some has or our

I think both. we can do

Scott Group

XX:XX you. Okay. Thank

Operator

line comes of XX:XX next Please from JPMorgan. Ossenbeck question of your Our question. with Brian proceed the

Brian Ossenbeck

question. XX:XX Hey. the taking Good Thanks morning. for

is sustainability things makes Power any a follow-up drop then shipper visibility staging a that it Power you more that and therefore chains Mark, freight just they're maybe talk hook, how changing side, Only and and things Only and there cycle. the how on more the and that just are a the thinking more with from about secular about on little perspective. to to type how through maybe supply sense and of the think for demand Just move of there and can

to to now So more If the can hang carriers just your obviously you little it's there. the thoughts maybe retention, you curious really carrier could bit asset competitive based, if on because as both give elaborate competition, that's quite popular right enabled, And a well? on on the also you think tech of if

Mark Rourke

XX:XX Yeah.

I the equation, have a who the think needed what they ends or/and Power have efficiency can to the efficiency. shipper both scale either the of it's trailer offering on best plays and dropped Only through is have larger generally for generally certainly hook on level, both offering at like and shipper but ability so and

book their ask we our and at like they And to what then, complexity and out the can, really through then distinguish. see offer a so and another dock or box that. pool offering what this to about manage our is decision offer We science, coverage don't the up as them we behind in we price, orange box

the we'd larger scale, a carrier I brokerage to great certainly even carriers level allowed than The asset we is get both like equation. on easy a that in that we've XX,XXX that technology to growth we carrier box community sides spend asked technologies think time so such we like traditionally had use So the because that we a our of the we're our company, of long efficiency to done our that you with business in that the the I that to not really have pool think lower because only driver bring we seeing you're of we but with driver another tail and sensitive and carrier tapped treat our of community And scale opportunity understand a as information to to a in little quality we it that community. a XX:XX of on that's providers that's we're why because freight carriers to we're we different into us line and why what have location see making bring at we have playing carriers, the that we and well, all carrier's adoption advantage. and different because the that

Brian Ossenbeck

little just Great. of a That's but start a that volatility of a there spending. speaking, the you, your just behind leading view follow-up year Okay. congestion obviously from gradual lot broadly lot more more release, XX:XX shift bit in and case, talk base helpful. you've chain services from quick back of press maybe supply indicators remarks is congestion but a we lot the to and improvement? I Obviously, but watching anything think that and particular prepared that's visibility what's on the in in more there's a of to of seen to we've touched the on kind it you're folks the not And good

into you monitoring look are in you year? as new how thinking So the about that

Mark Rourke

southern fluidity, pronounced it's news it's more Well, that in XX:XX have out, part year we eastern coming to being the driver impacting people and still, The availability great gotten weather bleeding period. our certainly, not over of of of the locations We as and are typical a January. COVID but latter is, through certainly, dealt seen yet. here and into and with and longer community it of deal more as haven't relates as disruptive many maybe the particularly that good an the a first us period has part been

over in do certainly, we've We're we seen have get talking time haven't really assets are about deploy. seeing a we performance the as better. think the but think more West. will as so that we already So it Intermodal, We we really to yet, to talked, start East, good

we comments more So this to are COVID get day-to-day in yet, little a point aspirational the it bit, as weather, be productivity think behind some those this piece as than like us through we opportunities. more openings getting get and seeing looks actually that we but brings at us the through

Brian Ossenbeck

Thanks, XX:XX Mark. Okay. Great.

Operator

Please Subin with your line last comes Stifel. proceed question. of with from question Our XX:XX the Bert

Bert Subin

morning you thank Good Hey. time. and for XX:XX the

Mark Rourke

Bert. bet, You XX:XX

Bert Subin

up I like up business? on steady I from margins that your what’s questions, XX:XX not previous In Following scenario the would upside ends meeting think the have Only. scenario, look to Logistics downside as what do for happen? with at Power double-digit mean grower that what you expectation, a it

Mark Rourke

greater so XX:XX a we then a it our asset has structure on market far, variable a basis fixed play you that adapt cost cost and versus it, more What you business, the structure at percentage it can far and like Logistics quicker also side. the are to a reasons and a the level because to spot plays in

multiple we've decades and several and us and experience has up does added digital things technology serve for been nature as our the business very some it's business transformation. incubator and its we it and go by down, go for just also resilient. the it as And been So last over so, cycles allowed our have particularly

that, going and completely And margins, but immune recession, it's keep it to think go initiatives. relative so resilient revenue will lot of from the portfolio. freight of portions cost, most for ability the to scale, Well, net the to your it's any one nothing type be got a could I What of wrong.

Bert Subin

helpful. XX:XX Okay. That's Got it.

your that can argument business much five hasn't there people percent it at you as the I rough model I break changed think look of you you representing an you think piece maybe that's differential the network is But a out. think as have the I specifically volatility. the operating as Just sort today pointed of versus don't but has, higher your guys in out, know, me, that you ago? from years income know from one I derived give this follow-up

So Thank any color there helpful. would you. be

Mark Rourke

sure is mix dedicated in this most But as far resources. is we've the there question. XX:XX totally not by following ever company I'm Yeah. the I'm had versus a -- network

as in its point but here think less have maybe go we upside been this at into because by is a the So if nature dedicated configuration that's model. a from the in time what generally business well steady you far XXXX which historically is march, a in but you a mix downside standpoint, less cycle as of

at where been view, may least that's experience present. our don't from [Multiple least we're I and know, that or I from I’m at to think XX-XX So trying something resiliency come probably at the Speakers] our like

Stephen Bruffett

Speakers] invert the approaching mark network we're becomes and earnings and [Multiple Truckload question and predominantly XX-XX segment dedicated we Yeah. prominent through rapidly as go the a roll the the where clock back like more XXXX today, XX:XX years, five driven probably portion. will it's in we If volumes

Bert Subin

XX:XX Thank you much. very

Mark Rourke

XX:XX All right. Thank you.

Operator

no There to I'd call are for closing further hand like XX:XX questions, the back remarks. to management

Mark Rourke

All XX:XX right.

think everyone hour of season. to and to first the attention on used and to the year. earnings going everyone's today. for thanks get what thankful We're hope here end we a your be good terrific transportation So has after quarter get a is full We

Operator

for you XX:XX conclude teleconference. your Ladies today's and participation. gentlemen, does Thank this

at have and lines You day. time may disconnect wonderful a your this

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