J.B. Hunt Transport Services (JBHT) 18 Jan 242023 Q4 Earnings call transcript

Company Profile

Participants

Brad Delco	executive
John Roberts	executive
Shelley Simpson	executive
John Kuhlow	executive
Nicholas Hobbs	executive
Darren Field	executive
Bradley Hicks	executive
Brandon Oglenski	analyst
Ken Hoexter	analyst
Bascome Majors	analyst
Scott Group	analyst
Jonathan Chappell	analyst
Justin Long	analyst
Amit Mehrotra	analyst
Chris Wetherbee	analyst
Allison Poliniak-Cusic	analyst
Ravi Shanker	analyst
Jordan Alliger	analyst
Jason Seidl	analyst
Thomas Wadewitz	analyst
Brian Ossenbeck	analyst
J. Bruce Chan	analyst
David Vernon	analyst

Call transcript

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Operator

Good afternoon. My name is Krista, and I'll be your conference operator today. At this time, I would like to welcome everyone to the J.B. Hunt Fourth Quarter 2023 Earnings Conference Call.

[Operator Instructions] I would now like to turn the conference over to Brad Delco, Senior Vice President of Finance. your begin may you conference. Brad,

Brad Delco

Good afternoon.

Securities introduce to like I forward-looking as within the expects, I could Words estimates and of call would intended identify some these involve disclosures based statements Private of meaning to similar speakers, anticipates, current provide the Hunt's Reform regarding J.B. such expectations contain different to set Act forward-looking and XXXX. Before may are the Litigation from or forward-looking expressions activities intends, This are forth forward-looking plans and risks cause be materially that in uncertainties on results statements. statements. These future and those statements statements. the

other information refer the factors, please with regarding annual Securities to and more Exchange report risk and XX-K reports Commission. filings Hunt's For and J.B. on Form

our would our I Services; joined I'm to President, John? our Darren Now on speakers EVP now some John comments. Brad to John Contract for I'd the CFO, This Hicks, Kuhlow; and of Shelley like today's over People. President Services Roberts; like afternoon, call. Hobbs, CEO, COO and of Roberts, our Simpson; Highway President President John of by introduce the our CEO, and call opening to Mr. of turn Field, Nick Intermodal;

John Roberts

good good the start bad obvious. good and to long-term investing disciplined team are in our as to the Thank I'm as business. to believer let's hit we'll results focused, would taking it the over with in while how do with before the the and I we you, our with on well Brad, continue topics and approach. so We like discuss afternoon. turn the the being a to couple I of managing and so bad, bag a remain our and

non-driver driver we the faced an headwinds of been professional cost. as topic routinely and benefits inflationary a the insurance, health of as areas as care industry wages, you equipment with we in and the On covering company have cost well

area of also an industry, are as or However, cost we claims, pressure the settlements. in seeing unprecedented

As you to and higher in of million in additional layers. insurance quarter we costs release, $XX exceeding our saw costs cover certain largely the in limits related claims incurred

best the safety, verdicts having XXXX cases for XXX% and Institute verdicts DOT miles. history continue despite the We yet being measured accidents as an in one safest the a performance Jury This as by per result, of experiences Chamber U.S. on have preventable our verdicts higher is from to our verdicts carriers rates XXXX seen settlements. the increase litigation average in industry, where in this, Commerce company's trucking industry the remain insurance to lowest of the to $X of size million higher increase exceeds reform. in the And according Legal million XXXX.

get passed in motor claims the Given and the minimum that legal coverage. inflationary carry industry the on bear the or above of in who ultimately, only It's carriers costs of of these customers escalating in And consumers. larger the carriers $X just the share cost. insurance million majority disproportionate and broad to coverage $XXX,XXX

we investments latest are on Nick in our this heard updates heard from continuously repeatedly, you've As from on you've and performance, our us area. safety focused

continue our in intense to and these remain the drivers, the equipment in technology We public, investments. steadfast and our and we'll focus safety technologies the training latest our motoring to our of and safety the and on investments customers motoring efforts. helps compliant protect to invest the committed Our environment, to and latest and public, your support people safety the

responded drive and as their confident I to value aware, proud am during these investments Riddance will challenges, our XXXX. and The how but the downturn, of have Good we XXXX very and environment, made presented the am the On of I they this our on long-term turned leaders Goodbye the challenges. team page for many you are perseverance experience freight and company.

pace, While to the environment. year not has the much another the has has calendar freight changed new flipped in regard to begun and

work the all While revenue remains across on and in we capital our areas We and of cost the a while our execution term, earn see business, opportunities committed it's for in needed focus to is our appropriate managing return invested on customers. challenged return freight to remain environment good an long controlling quality, but value state. to the of delivering

of and all income side way, last and of be across other performance. our and am the our work Final our in segment quarters growth all future. opportunities rail to in the XXXX. operating some our a on our momentum team's with our presents providers performance out this of the the record had efforts continues market volume opportunities in that a seeing relative both And With through years performer businesses, longer for of by few presented for Intermodal in BNSF steady collective I truly in encouraged Mile, Dedicated is

of while in still efficiency challenges, scale to and And technology JBT opportunities the see market drive faced offerings. in customer brokerage our great power-only both has chain to the ICS in and brunt supply we our investments our

to over I'd Now turn to President, like the Shelley our Shelley? call Simpson.

Shelley Simpson

John, and good Thank you, afternoon.

technology we of our people, remain XXXX, focus, and through our committed areas navigated to including investing strategic capacity. in we've As

people and will prepare connected are for value exceptional biotechnology people to their demands over we The to talents allow always are our capacity deliver what with our and network, for combined and and years of meet capacity our together the us in am customers first, ahead. our I enhance to proud of the experience to grow which to continuing investments, as to our people customers. come Our invest have while and our deliver commitment

John couple especially volume discussed with see in around As signs discussed, lagging timing the volumes. some the historically quarters, that as to potential intermodal it's challenging we continue related any we have we said of but a reiterate of remain a leading inflection. and past environment, of to is a price important improvement, while is Having uncertainty that, indicator indicator, think typically to I

with how long term on the for value our ways deliver and improve the grow Going focus to efficiency supply we of out over forward, chain. remains waste by finding customers drive and our

we our organization market focus the as look uncertain As XXXX not dynamics, an to changed. has and

continue We to to in growth. the best manage our business long-term put for position us

While performance the the we are with are business business, our segments. long-term across not satisfied results especially focused we current return in our

lack XXXX, volume growth, this the half us year. Intermodal will of pricing of last during the end bottom line bid will make growth losses this in is and more has year. tepid challenging were well margins truck Mile with top of impact positive count first seen up of demand at Dedicated impact and least our be season markets. the holding but fleet in despite through growth the but resilient Final

and brunt both Our brokerage and fill pressure market significant price the are continue and to the the on volume as power-only freight evidenced by of businesses under performance.

create We can value our are can focused flexible in where through customers' Mile converting and We best J.B. control is customers. experience Final This which our the cheaper costs. our by on most and customers technology efficient remaining XXX service customers the in to different deliver go-to-market for for our intermodal, most Hunt to network. controlling reaching is offerings and shipments or to leverage lower value to save differentiate strategy over-the-road money end intensive. help platform well can the and the customer efficient our carbon We drive dedicated our fleets source less capacity mode

focus XXXX. In of areas closing, strategic I'd like for to highlight our

deliver exceptional excellence to we focused are value operational on First, our customers. to

us differentiate market service will While are our peers share levels to support returns. believe consistent we strong, further ability to acceptable quality and and at service win

capacity. continue third, term, for us, the investment is something technology with customers in long-term and We long-term want in our scale further compounding growth X us in focused Second, we our for our commitment will new for market our And to on our operate returns recovers. people, as these remain to a we areas driving investments shareholders. long-term position Business with network North and to call most John to deliver options solve John? value the America. in customers needs, like and downs, greatest Kuhlow. our to that, efficient With but transportation different market the the offers to over the for to the over I'd CFO, believe vision our our supporting ups cyclical most approach mode ultimately turn in long create their we and

John Kuhlow

everyone. on capital an update will a comments and of My and high-level fiscal cover as you, XXXX. as insurance plan more Thank quarter good expense well will and color on our afternoon, include provide the quarter, on the review Shelley, year, for the impact

results. a overview, season a in see of with the As our intermodal extent, signs fourth quarter. Starting the Mile, lesser outside and quarter peak of didn't general to many we Final

exceeding by and inflationary XX% pressures. continue quarter related amounts last consolidated a revenue a per million insurance declines to to GAAP lower On charge in the share share from in historically last primarily than year certain incidents insurance incurred similar we claims quarter to certain a limits higher as experienced. higher at to year to Operating primarily yields declined were cost and earnings charge ore developments The decreased include we much coverage expense negative This freight year, X%. of $X.XX and claims with results is $XX combined prior in diluted compared settle or claims declined driven volumes income the per layers. basis have related Fourth charge fourth XX%. diluted

declined revenue per operating year the results For declined the on previously. earnings XX%, of diluted impact decreased XX% consolidated charge basis, include income These I GAAP outlined share the XXXX, XX%. and full year full a insurance

the continue Looking largely pressures increase and to to but costs. to Part premiums, premiums, in to XXXX, cost to in across inflationary greater capital the of expect provide increases we market conditions, coverage also areas relates insurance in underlying of people due insurance businesses. the

shareholders. We us needed liquidity maintaining value long-term with focused capital ample to sheet deploy on are for strong provide to to our as balance drive a

with environment conservatively to XX target We have and EBITDA of our Xx ample while borrowing freight this if challenging leveraged has trailing flexibility our facility debt below capacity maintain months that navigated needed. credit remaining

net $X between $XXX we million XXXX, Looking for are capital to billion. expenditures and planning

million a trailing and for and million plan and includes Dedicated in for $XXX trailers. Going level primarily containers, Intermodal chassis power assumes $XXX new our capital new deeper, which million $XXX million $XXX XXXX equipment, to to equipment,

to estate including real expect other $XXX technology. to $XXX million million for deploy also and We investments,

we concludes and to of dividend, XXXX opportunities leverage and repurchase to while EBITDA. In contemplates This our addition, it in around market of our in capital support I'll maintaining present advantage turn Nick. Xx plan the themselves, take they over remarks, shares expect when continued ratio my the all our to allocation now

Nicholas Hobbs

I'll I'll of Final Dedicated. with focus afternoon. Mile across provide good start businesses an our our operations. update give on and an and on John, update Dedicated Thanks, areas and our

fleet expense XXX revenue in bringing insurance-related and Demand well, incurred up quarter, results the the held sales and sold environment with despite pleased fourth freight approximately our I operating approximately the our segment. new million fourth of year had am both Even with to in our trucks deals challenging trucks. XXXX, During outsourced record income. during solutions of in quarter, resiliency number year Dedicated the of the business professional and private a $XX the full we has X,XXX approximately for strength

Our are pipeline and 'XX, into to have we visibility by throughout these losses but some do strong, fleet on backfill working that remains pipeline. hard executing and/or downsizes

remaining Importantly, ensure to of our return. new we disciplined opportunities required we in are pricing rates maintain

business. year, put improve around our we want from I to the work challenging growth a overall a was to durability XXXX the perspective, fleet strength done context of and have some While

of handful XXXX the percent we While we of that over experienced in fleet, a during was last in churned Recession. Great year, the we XXXX portfolio have what saw lot a half accounts of in even the downsizing of about our lost

process, up during our delivery private value fleets our put from experience for and better during on was time, this focus CVD us Our performance customer established that that downturn.

scale to manner our executing all to for in behalf offset possible. the includes look focus while XXXX, value the create inflationary we customers to our leverage strategic cost of safest pressures on density and to help continuing As customers business, our

Moving to Mile. Final

behalf we create improving and strong on metrics of quality and highlight our on our the have progress customers. of for the good value service portfolio We made revenue our

in bulky to revenue the for holidays. Our remains a $X in outpace furniture, we products related change see change lift overall additional did and continues in incurring expense the in and seasonal but around million quarter. particularly profitability insurance the Demand muted, equipment exercise big in year-over-year demand despite for

and Our bulky on providing service the the remains homes customer. highest big delivery quality the focus business into in our customers' of this for items of

new service-oriented resonates in team. market, This and well discussions are in with focus the we brands seeing our engaging

that we business the we're on and solid the scaling As we move have. XXXX, on into and growing focused foundation building

will taking the people, We and our enhance their continue secure remain safety invest I quarter, some in equipment, of and to a while foundation motoring our last excellence our manner. in Similar with close of will also with for and to disciplined safety our and customers on focusing we on to safe, technologies operational quality on aligning training to public, customers and revenue performance. our employee care comments company want but new also execution equipment

over are out inward-facing with cameras XXX% our the with We end goal quarter. fleet XX% in of the third complete being rolling of complete the by

As had by our preventable in having DOT a performance accidents lowest in our million measured per company, miles. we best safety our XXXX, history

exponentially. of to move As you continues cost have up heard, claims the

our we performance to So possible. continue efforts to and enhance our safety mitigate new where risk innovative further ways find

in and heading our our and out older good Lastly, is fleet on position have cleaned equipment, XXXX. refreshed equipment into we feel

you Kuhlow now range concludes I would on John a remarks on CapEx, our equipment Darren. which it over This reflects like to heard give age. position my You to better turn

Darren Field

on and to market this Nick, stakeholders. for preference. continued an with during quarter, Intermodal we joining and have to performance you, deliver business thank us update customers our service give and start the value all the afternoon opportunity you Intermodal's everyone the and the the highlight I'll our performance I'll the Thank review for of call. on

in remain in a by freight Intermodal X% the improving we continued evidenced As in have which as for the trends quarter. spring, you been our we environment since heard, but challenging seeing volume increase

volume an October, improvement our our November in up X% quarter, in up year-over-year By volumes trends X month, In fourth since X% April or in for in monthly months. have seen consecutive fact, the we were in and December. X%

service for saw expecting, season or providers while we the nor That solve we a capacity needs neither During flexibility maintaining our able strength were Intermodal to were yet customers' highlighting we of peak levels, customers high our quarter, in the network. and our our rail

indicator. are encouraged worth a seeing, historically volume the lagging trends price volume leading typically we reiterating are by is we is While that indicator, while it a is

amount grow recapture the to should and people to with highway. to place the from road We converted we see the believe continue of capacity a large and our from Intermodal, and that freight in over share be we have customers

priced During included approximately of the our in margin sequentially, fourth saw largely expense. periods to year-over-year and also we of pressure, insurance-related prior in related and results both million quarter, higher impact the quarter the bids $XX

or of We are far. season bid is so innings success currently in to believe of comment XXXX the it for early and early too the on our bid expectations

service strong and on network value our and serve our with Given this needs. meet the we we and unique value capacity investments earn is acceptable realized, to our that customers to ensure provide, Intermodal return an can levels their working are

with commitment We with companies. and the providers, are each offering With We regard during the quarter. West we our new the collaboration we pleased the our offering of remain providers in to announced doing growing quantum BNSF and service between have overall encouraged the their service by our rail been the Intermodal market. the our work from to

are by We that to with service and the about potential freight. this expand working market very customers the have service-sensitive excited Intermodal

networks announced During of customers to new Gateway with BNSF. needs, This out cross-border the quarter, capacity we Mexico solve both the gives leveraging Intermodal with the BNSF. GMXT of options and our Eagle also our their Pass GMXT service more through connecting

their on share to execution our transportation customers assets and strongly We In our better delivering better customers. needs. closing, us, our find excellent Intermodal in our for and ways of we investments and be over-the-road for to our new our XXXX market strength regaining focus the of serve improved will to leverage continue believe business scaling trust behalf and on and the from franchise, operational

more handling people, We That remarks, competitive excited technology growing have solution. our environmentally turn and over prepared and to in Hicks. cost volume than customers are the today with what handle and to efficient I'll meet and more significantly with friendly demand capacity the to it an remain concludes Brad network work my to we their

Bradley Hicks

Capacity Thank Truckload the of gross as perspective. very brokerage little volume with prior provide spot afternoon. revenue revenue by and review on you, competitive, BNSF quarter. depressed $XX down last remains period of J.B. Starting XX% and performance per an update in demand, from from The good in quarter, Hunt include the driven both a volume year. overall well the ICS, decline market the I'll a the same Integrated of segments Darren, a our rate brokerage Segment the acquisition versus XXX. the particularly and to decline in of performance Solutions XX% load. contributed the and figures was a as environment acquisition quarters, Similar in year-over-year to revenue assets XX% These million the overall contribution over remains truckload in Logistics. our

we current will position us success we aren't the the with While pleased are that ICS, for results in in future. better taking steps

We our portfolio on have of in volume out We quality some market bid front is with are our quarter. process to fully of the work which and contributed to unprofitable too efforts the it on the but our of gauge performance. calling rates, revenue the we improving lower some in the freight, early in season believe our focused

areas and through and test growth better will while platform enhanced these resources position attrition. our do mitigate investing believe strategic demand to capability long-term in for with rightsizing are Overall, We our success. us in changes we current

premier through high provide to theft and service, value and excellent focused cost levels across execution growth activity and on the either strategic scaling quality business further Looking service on-time our XXXX. that quality on further volume We're through performance structure at or we reliable, mitigation. with market in also we align rightsizing In ICS, recognizes are focused the attrition. the

once year-over-year, can the XX% the key per quarter our market drop versus the is a customers outperforming was the again ability by combining volumes. offering move that Segment with the is Truckload. we the load to to J.B. demand capacity as in JBT source XXX XX% for our Hunt box resonates prior Moving well or and platform a trailer X% were carrier year. provide decline down revenue decrease by in in driven up load J.B. and XXX gross over Overall, revenue the service on Hunt flexibility The with to customers. volumes

trailer having of increased amount our improving network we XXXX, efficiency significant on add a to turns, are without of the into assets. Going our through capacity additional focused essentially network creating on

balance also of network ensure our are healthy. We focused meet and correct assets on maintaining place to trailer demand sure the quality across portfolio remains our to the while revenue overall in to are grow customer making the continuing

with on close I'll some XXX. comments

environment capacity. in productivity investments our also is position productivity people, better us. capacity efficiency our allow drive recovers, we success for our our investments gains a and investing enables service in people, for in demand, our is to with We stakeholders. more Despite higher the That customers. drive for technology Our our know our resources to helps will our comments. us create we and and That technology remain customers to aligned challenging without key in growth depressed the our confident to levels of serve technology value improved productivity people, current allowing my market available our long-term add meet having with becoming said, believe customers the driven demand our that Technology foundations, degree many our with structure capacity and and to that as remain see company and current freight we us cost concludes conditions. greater by focus demand, just by XXX people while to these as and as and customer continue levels is to It for continue us masked providing how high platform. source market efficiency drive some

I'll before for it provide the over So turn call instructions Delco opens to Brad Q&A. operator to the

Brad Delco

follow-ups call the time. for one let's given question just without Hey, Brad. Thanks, Krista, the open

Operator

Capital. question first from Barclays from Your Brandon comes of line Oglenski the

Brandon Oglenski

your have and how can Darren or times a on just Intermodal business the progression you to about guess the year progresses? you couple did the guys us get accelerate the is of I help your guess, lagged value the lead volumes a indicator here. customers to yield that I XXXX? quarter. volume think ability Are profitability and in mentioned as you about this pricing I greater being know Shelley, from how going operating through

Darren Field

start. So worth guide is pricing to I'm I than Certainly, say XXXX. Brandon, return in performance. Darren. of be terms This volume going you performance will I'll What not and is into forever margin will more

And through lot be our return a We customers the to we represent proposition value go yet determined that are believe certainly, a bid should investments. under position we cycle. cost immense pressure. justifies to as equate our we There's to the

out and question we're in And so your is play what environment wait and XXXX, to to the answer to the will is all see have itself like. going

Operator

from America. comes question of next of Bank line from Your Hoexter the Ken

Ken Hoexter

a just on just follow-up impacts. Darren, kind margin kind cost of of to pressures, the understand

slow pulling implications as see get think talked when back business slow about I'm expect cost you should And when down, trying that guess, that in we raising you an to the the impact, containers I ongoing insurance are not in cost, out down through then cost that we should how business. benefit the the those you containers I could margin, inflation as growth. walk understand bringing bringing part? the if we You understand about then to those Maybe that's costs of guess, out. -- should the the us

Darren Field

across board, certainly. lives have cost just increases, costs the when I not wasn't with and higher, inflationary that itself cost pressures, our and just out cost all the we don't pressures mean, drivers our rates cost Intermodal, are that our containers across Well, Certainly, in cost I highlight -- just higher. inflationary railroads enterprise, are wages just Sure. know highlight employment to equipment for I storage. intending taking from maintenance more, just I of

of to our that in see you we're our that same together challenges are and of more deliver cost for and customers look out those So that's And we with the forward. are customers partner with. that. all get faced thing terms system how to working we're value we do why, certainly move as And each take with. other faced It's when

Just get don't like on know expect growing have the that in our cycle going the we're see dialogue behind get and We exactly quality that. until has question, pricing know the a with. last base steady built really what can wait service we the we're we We volume just to to us. the to around earned challenges customers XXXX to these with us in faced right cost and

John Kuhlow

And Ken, this is John Kuhlow. I'll just add.

On general pressure And we seeing, in to that the those risk insurance upwards of management and cost our insurance for we're coverage into premiums. we our maintain reset approach going to is XX% as XX% premiums to increases policies 'XX, exposures. saw the

And driving individual in so is pressures. premiums. inflationary the about the working job down, We've we're claims of great but and to around talk our incidents a the 'XX, inflationary what's focusing seeing on pressures done in claims the that mostly to safety it's lot a year cost bring this when of we those try

Operator

question the line comes Your of next from Bascome Majors.

Bascome Majors

if charges we you don't in takes that, those add income, as and just to $XXX think nice XQ And to if lift setting give back or your income saw you that is the just adjusted to sales, want So from equipment fourth the start. guidance on operating actually a puts quarter. pretty I the expectations charges or seasonal seasonal adding you to sort history for the Maybe versus insurance the in place for fourth back operating decent losses level know about could a XQ for so of talk decline, typical quarter. you year, million about next

Brad Delco

Bascome. a this. This is at shot give I'll Brad.

want. you you guys insurance how mean, I First, treat

net of of I sharing sequential. loss was more change that of I me of share. comment think the equipment front $XX a have versus to sale the in And intent on million year-over-year don't in

we expect of there's lot provide left, of while typically XQ guidance. should from to what terms don't In a you still XQ XQ,

delivering as what's I'm heard the the things from kind will sure quarter, So we're executive of will But on lot that's value team, the for of be on on, happening. the to a inform in compete just that have getting we're you've the the we're of ourselves over return that going our focused sure us. you there's making itself on course working market right we'll focus investments. market and to and earning and customers making to forward, And sure given our

Operator

Scott comes from Group Wolfe Your Research. next of question line from the

Scott Group

from I you -- West I I that. taking or didn't guessing how pricing may wondering Coast share you the side, I'm I about about you're from think talk Darren, much I on share benefit hear trucks. And you may heard port you I'm not much. then talk hear not Intermodal gains? guess, mean, saying

higher So up maybe -- for going up. Truckload I'll go before Intermodal starts a or pricing you wait where just pricing Do without we go Intermodal pricing ask this to it goes to start see Intermodal pricing think Truckload we to can to need for this way. given to decoupling higher improved demand environment,

Darren Field

questions, Okay. Well, X thanks the Scott. for

years in given it call going lowest to even when like window into volume from comes regain PSR the us some fruit the of So to feels back I'm pandemic. certainly through several share time it, share the and of highway, over, certainly, to loss that looking for

velocity. lost we to Intermodal transit as think I velocity And weakness better customers consistency the compete some feel our due in on in share we model customers gained need. XXXX, for like can that in the we

highlighted largely in traffic grew release we the we Transcon Hunt. highway growth Coast the XX% Certainly, ports why to we in I that through West that's fourth think earnings Certainly, conversion. So highlight absolute quarter. is the J.B. an benefit of import

imports. So highlights that, would growth think, at I from least that some of effort of advantage

already I in in Eastern imagine West highway network, there will a pricing would Intermodal rates. be Certainly, networks and Transcon highway can't our a factor to pricing Intermodal relates highway I intermodal ever pricing to Eastern influence think between it the network together. in pricing decoupling is decouple of XXX%. our pricing decoupling, from out As the some there really world where market bigger not the tied that networks, than is Eastern But the that

Operator

the line of ISI. line Please Jon from comes Your next ahead, from is open. go your question Evercore Chappell

Jonathan Chappell

I'm you. with going to stick Darren,

You volume everybody. mentioned fourth quarter surprised the number that

your which the in What sounds of accelerated in the shippers. was part surprising kind soft to up figure even like happened with that kind more, rail everyone December all Hunt kind for your most your others is BN Yourselves, trying the partners December your X%, the new an from J.B. goes was else. fact like that acceleration that what to why Maybe think easier heard segment. of Was on to more comp? kind or we've last you December question. the services of done services, it new out just unique would of Just have contrary

Darren Field

Yes.

Appreciate question. Okay. the

think services I that announcement don't a the we're the different were we excited want service conversion -- business method. handling was to through I certainly, from a Mexico new about.

want we the I certainly capacity about as portrayed was plans comp be long-term So to that term forward, allow don't December, growth And think the as movement. us long immediate easier. move an to in for it our grow the I when Mexico to But further solidifies future. over

for fourth extremely that. very team, we're us that sure really It of go proud we've spring they and our quarter the had proud really, really even I our the the significant a predicted. factor. a than say that coiled make is even say believe also as at a really highlighted execute season. And for was shippers many as to and of I'm peak I our for and what customers particular surprise. group season in us more and to far my high I of mix want I'll peak so that think that's I customers peak quarters, serve call And level allowed that. of this why a season capacity, that to we

Operator

Your comes next the Inc. line Long from Stephens of from question Justin

Justin Long

else? as I'll costs of Nick. well. maybe a resilient, moving year? or expectations downsizes depreciation, it outside there level for fleet pretty all so. relates you pivot lot of should and that aware Dedicated and as anything with question initial factors growth a this And know When with anything startup of pieces the we together, insurance has Dedicated any on the And costs last ask fleet on be of year put it I But swing to are or been Dedicated losses in some for

Nicholas Hobbs

was Yes. our this that, just year we or collecting we we than talked I 'XX. structure did we performed and better And I our of deals, just going much fleet on about and did XX% CVD. think X%. the lost 'XX X% lose I say, I back 'XX in would of as about that thinking to and in lose we're

I a so got diversified. business, think we've better through of And better base that,

that about our we're I'm out I that just So going give would and line I of going standard I up well. pretty feel to that come our say sales, think sets good of you to though when we've fleet sell visibility we X,XXX plan some some to And tough doing to going to X,XXX really got as up. We're on losses year. trucks just again. coming last and said, a did like year I we've

of these stable. And -- We our it's parts I we've we're market there's quite what a so some fleet business our legacy time. have what of that call the for pretty had I market, moving at there. in look some the more, losses business really lot would in and when been But after private

our will more I private get forward more And move think solid we so base as fleets. with

Operator

Your from the Amit Bank. next Deutsche of line Mehrotra from question comes

Amit Mehrotra

understand that wanted just momentum to I question. volume Darren,

then quarter obviously, Sea disruption You're the rethinking talking volume the XQ, that tough your talking through about And it's but where season, year? build selling of XQ you're and loads in X% related there's down maybe Do expectations to obviously, Usually, I'm XQ go is customers Suez just about quarter. can this seasonally Quantum customers adding a momentum And March move lot sequentially volume were Panama spring their are they up talking we there assume that, Service. Obviously, for I the down, sequentially, we momentum. and XQ. chains, are you Intermodal can continue think momentum to really to as Red the that, basically. are first because Canal a Canal, supply about

expectations the over months next and that from talk right that's building X you on are So about you from then are to happening where now disruption us you just momentum the what move the your red today? customers in telling And sea? March as

Darren Field

impressive, Amit. was That

like even volumes our times, in that surprised highlighted fourth think the many customers and -- quarter at we've as that. look, came us were by I

fourth been say quarter that's surprised about a on career, they during that from unclear down now largely again, fourth quarter. to right feel for And little is more the bit the think I quarter. we part was the this year the I So that in case. that entire volume my built customers momentum a had the holds. I quarter activities think that's what by that the were that of early because related going would Certainly, it, first those why drop traditionally,

that our us a tell continues I solid be expect. inability get you to on guide good about what so But certainly, I'm know going happen. what us peak for about to to challenge don't to information season the will And customers' to

Operator

Your from Citigroup. the comes Chris from Wetherbee question of next line

Chris Wetherbee

inflation I maybe guess into insurance. I tie the cost about wanted and it to ask

just the the that to trying And I I out with side. so we've And insurance I'm trying fourth what period. for X years to means from go-forward had understand, quarter figure I'm guess hits guess

So does quarter just cost look portfolio accruals into we some cost that this inflation, if are kind into incremental if we XXXX? getting maybe of of the as inflation charge what of fourth XXXX? in there could required is degree then And you that at is that tie mean the the think broader take we're do you businesses, that for running

John Kuhlow

those year we in to fourth where we we that we see them and continuing effectively reserves. we the the that that charge for again. needed can't to insurance, we go claims. This unprecedented properly year will Each we believe last working makes I situation respect our reserves this we're settlements so our and really limits charge coverage in that And assess in With a take do with self-insured. actuaries, had We happen our a reserves. to Well, prior quarter, ran say Kuhlow. as to again, John that quarter. the never to relates our we periods, Chris, our took our of take have It's but up that need out we did what refer through determine to valued now. I'll

that our forward. taking that up in for we going I maintain little up coverage is and we are 'XX and approach businesses, before, and and all to in of bit 'XX taking -- we do did As mentioned our a

and give to seeing the with environment the Just -- how we're to respect current settlement claims.

So -- claims these how do settle. or we see

we're where most really pressure. that's seeing So the

look is basis. we of through inflation feel premiums that the that our We we're continuing are, from most have to reserves underwriters. on a our like But I seeing cost the again, at quarterly

Operator

Your line Poliniak question from comes from the next Fargo. of Allison Wells

Allison Poliniak-Cusic

Just then want visibility back, of Nick, fairly also But than XXXX. able what's being go the to pipeline whatever the Anything just specific may opportunities for of about Or verticals along those talked any is quickly? it downsizing, know your to capacity sleep And reallocate that people about it the sort Just here? to less of you of Dedicated, come sort defensible? I might that the be opportunities. thoughts. preparing was inflection on more

Nicholas Hobbs

Yes.

get waves is I all, cost. start-up, usually have our we to Clearly, would so of way the First we the replace works when incur them. ability we on business our say,

gone in with have of into so don't 'XX. And losing us have the our momentum 'XX, we normally we trucks some

just quickly, momentum takes we replace revenue of and it the the profitability them time the kind going. so little get get to a and up And and but

about reason are. way talking we're the the that's So we that 'XX

the economy been would Now one look It's kind And side side, of as up the I and furniture really strongest others, that just the the been consistent impacted of have as that But the a that's would vertical, say we probably going of just sticks then anywhere out grocery it's things they're throughout. kind going, been is of as had else. bit on say through any far we our in some. book, Dedicated. little I

Brad Delco

I'm your kind of touch Nick this the I quarter before, want new just question to team fleets. that Delco. add to that on each we sorry, share about churn a had is selling Brad the success And the Allison, shared in

XXXX. Nick deals. was very so fleet by of equipment of base of losses successful number some on the of And kind into those selling churn in that shared the X% in team new backfilling a The

XXXX. hey, fleets think some the And to what think in that focus in of mixed strategic messaging backfill we I some of some effectively, foresight so going I into losses. remarks, selling those downsizing his hey, And some out there said, is to he is be prepared have

Operator

comes Stanley. Your Shanker the from next line from Morgan Ravi of question

Ravi Shanker

anything to it's some place putting in Congress, situation, you outside Do think it regarding carrier some much a control. how seems this? ones? have on And the obviously, large Just can to carrier to you some legislation a versus going on insurance as impact of technology is there you're little your this impact of large given avoid these of disproportionate bit answer Is a is do only of frustrating tangible maybe guys in reducing small the claims. the

Nicholas Hobbs

had Yes, entire at -- like cameras. is on rollout. things XX% We're with And about DOT pleased in we Nick. the and complete very I'll that. safety we this Clearly, jump look we're when we doing We're year that for inward-facing think record preventables organization.

by retro those We all of will the trucks other have end QX.

our couple XX% of on then So so side. that And can't Those it's helped that's we we Sideguard we the clearly Assist also to got you another our help if we're think us think of that take us going with fleet accidents. will us -- years. got retros, right

on the safety we're So is through going leading just But cost roof the the well claims we honestly, side. courts. and think in fact quite the the of are And out state that those individual are those.

by be reform. working And so it's American a and Trucking the state that's state tort addressed. to Association with got to to state by state go We're trying get

truckers to that would there. federal out long us there battle kind some legislation going it's there unless be is So of interstate help a

you... I don't if John, know So

John Kuhlow

improve are it Nick something and frustrating, the themselves said, add, are And we on with do just our to we're to focused I'd settlement to safety Ravi, incidents make can the control. be working down, done but the to can there we we that respect charges. then as areas that is everything sure needs to

Operator

Goldman Your of next Jordan line comes from question Sachs. the from Alliger

Jordan Alliger

cost in black? mean there volume? to your back bit a but lot brokerage a or to needs Or and Maybe sort brokerage maybe purely to up to think whether do get happen truck it of things switch investments to still the I is Is price past, equation. on thinking technology? profitability. know it made there a talk and do lot little of of you've little a you I side the profit-wise. some in cycle a need thing, Obviously, to structurally of bit what return you be on the pressure it

Bradley Hicks

our Yes, as year. is entire a cost amount of quality brokerage We environment Incredibly Jordan, time know difficult and Hicks. the we focused back did decline you. thank on revenue up as we will This rate throughout spots ever spend so Brad we feel do it through the volume tremendous just bid your quarter an I And bottom. last season tried difficult significantly, environment. extremely along X.X like kind declining pick in or quarters, really the to made of that saw

from of of the strategic. 'XX customers saw time need we experienced really look his end mentioned bid acted to but the a back on at our mention throughout in that for the lowest And round they driving this that question really feel we're through behavior were season, approach Darren growth like in around price. felt customers what more pandemic, of like things transactional would to that pandemic, wait-and-see is several need that we from one As were really we greatest I opening multiple standpoint we down if and taking their bids, really you there that inflect. we do our thing The through

we And we're on to recalibrate can can on forward. how value focused rate how but do focused think where have to the we right growing customers' at tell is add about I we so networks. our step What we're growing we you

Operator

Seidl comes question Jason of TD line from next from the Cowen. Your

Jason Seidl

we through move 'XX. flows the bit at going the more of seems model for Coast with It there's terms to the a little be reported mix like we ports. the in coming back How West Can to that on as should outlook? it yields changes look focus

Darren Field

mean highlight has there's I mean, length today, is can the that per loads West haul Coast pricing doesn't certainly, longer Well, there. revenue but pricing environment Jason. really the to represent higher the would say necessarily there, of many load, just unknowns certainly anything I that represents What that too increases

that I I'm there opportunity don't a for of growth know going we Coast. fill mean on as able is about West we're an mix shift to just hearing and not that more to so out of more be sort imports about West mix are Certainly, for will even Coast And you. their yet. customers what be to the talking the the

Operator

the line question of Tom Financial. Wadewitz comes next UBS from from Your

Thomas Wadewitz

you affect a bit on related to I something sound that. revenue to really helpful does sense saw and I have the drove mix, see If quarter. wanted ask to Intermodal what of couple like margin of insurance, a margin. just length on you of basis if that, bit? help Intermodal So we could you margin favorable longer you you take fourth just the the a expense? in And about sequential was a little that guess wanted that out when Does about things some improvement haul repositioning And I the side. price? less It Intermodal points XX then Was that Was didn't of a on that in like margins. price. there change a give

Darren Field

be state contributing a Pricing worth spread volume to we're will that carrying asset that. been given and ever that over margin. the cost to certainly way fourth fixed is it than in the least the and us bit, material, the more that the and a little in there certainly were highlighted past, price fastest that was repair to count for unlocked certainly, has able is growth not quarter. was that and volume improvement be loads, behind think current forever No, our we our we will to the But I at quarter, Well, spring we coiled during continue own. a currently certainly, more factor

worth show is more to certainly, volume the so was And to fourth and quarter used able that. than be. it

Operator

comes question from of Ossenbeck JPMorgan. the Brian next from line Your

Brian Ossenbeck

capacity? carried point, that talk looking talk and here. to Are half don't for in you some part a locking at just really they quarter, And surprise then market hear some they sense momentum maybe, the that can about truck fourth that a Darren know they of given you happening? the shippers the I the expect in the conversations Are rest into of in here unfold What spot at this the upside durations? conversations can more all of terms back standing love just about you the looking Brad, in for uncertainty that's do with actual is you to want longer rate itself the you to maybe a but capacity rates, it? the and us what improvement. conversion give see year looking first there's if of Truckload from

Darren Field

Darren. start This off just Okay. then and it I'll Brad. to is and hand --

of -- think offer really rate a factor. service about and increases there perspective, acknowledgment results a There always I there, from it's terms I think is that. competition conversation variety performance, pricing be and good for that our to of will There universal out a there we wide and competition is that universal is feel real. in hesitancy is

to tremendous Our their up. have customers not costs go pressure are under

these a lot going be it. enough the And of same into -- so that's be to not far work we're to as at heads make or -- There's to time, a of we conversations be to able but tails really done. we factor

to service, going our I customers on in proud we're think and to the the that lean quality responding I'm of are that. way the of

Bradley Hicks

ahead be is cycle happen, which that us you in or fleets the a We we truckload there. operating go where Brad we is reduction the when XX of to they own in plummeted truckload than at in see when at give marketplace inflation, in the inflect. some too cost the XX the to terms our a to fleet, tell our that's point, space, what real standpoint, percent going are really of have but and general to can't Hicks. And trucker exits least of is Xx to But start last early see we to up. I something add, do this the in more the than attention and cost, I that going just on And Yes. that's rates Similar exactly to going way have Darren at We'd going later. down just obviously to to rates Brian, like perspective, look would see with from over were have from close to there. said Intermodal where in bid pay what's on sooner there. months what's than not capacity,

still would to mentioned, respond. matter They're something under But Darren not As are how pressure. when, do going it I not like you. to just tremendous will feel It's customers and some of so at that's give I turn point. a if,

Operator

next of Chan Your Stifel. the from question from Bruce comes line

J. Bruce Chan

acquisition Brad more on seasonal opportunity. BNSF the here contractual to in side. was the and to maybe gap talking percentage. integration expect of then sticking are those. that ICS function in of business that's just just through from a I Or capturing potability just I a you we some that Hicks, working was wondering cost about? that or moderate culling that the with thinking noticed down kind maybe segment, of some of And this through the spot mix the sequential Was you're function you do the maybe quarter? still due

Bradley Hicks

mind? of you repeat if very Can part the you your don't question, first

J. Bruce Chan

at all. No, not

some business was Just Was of you've percentage, looking seasonal the doing? was the Is spot that that BNSF at ICS that that move been culling think in I mix? XX%. Or that down contractual so opportunity? it

Bradley Hicks

Great.

it's me when yes. Thank not correct I when Okay. if ended question, when said last Well, you. I first, not let the

coming of right business been. what lower there. play had was we than of did I in Certainly, ahead XX% a through the Sorry, contract. we bit around getting But of that myself come mix in over-the-road factor. that assets acquisition we feel that saw BNSF the the A little

like contract forward, as overweighted got We our you where on the than published. pandemic, recall, if that spot. that you where look largely, history, swings XX%. move times as during we on we There's were be I at we XX% greater spot to think in that higher or

would the that XX%. for to be in spot sweet to us live XX% So

need But maintain. high relatively in the going to acceptance. tender going of spot tenders that's demand It to shipper that is and overall carriers accepting that think market market is we're in to category. pickup. also to amongst still Compliance like very terms soft I'd see spot So

flip, see of and to the you we start And do you're so see to to to as deeper pay going take advantage close move poised attention we're that believe real the grow, we'll spot will when opportunities see do likely in year. be we that.

Operator

David comes Your the from next line from of Bernstein. question Vernon

David Vernon

and then the clarification insurance Quick a stuff. on question

XXXX, challenging. EBIT then think thing. I number have dedicated the not to your about you did are EBIT in into the real talked EBIT the insurance flashforward we and taking like And we in XXXX what are to you John being Shelley, happened in recurring this it for taking question growing at Or or terms going is, appreciate being John, Kuhlow, the charge? comments would XXXX, that reserves, terms charge. if GAAP Were just maybe of If year the a another as on pulses. $XX So however of we I But we referring incidents I number. on adjusted look limits premiums you change happened and you the if million exactly payouts, the repeats, another

Nicholas Hobbs

Could Vernon? GAAP? that For first the Dedicated, you repeat about talking question again? you were So

David Vernon

First grow Question referring the number? to you're GAAP market. on that mentioned challenging to in perspective an non-GAAP Dedicated the Dedicated it's was, What or from to this I going think be number Shelley EBIT

Brad Delco

Yes.

sounds is to answer want don't answer This little that, I to bit I Delco, it that. David, but that we want too answer guidance. in think, don't if a because like I provides Brad much question

to and hard I I income we to speak losses. had our GAAP necessarily that's visibility And or on grow going there basis in to on to in quarter. Shelley's everything fleet try a and don't the we revenue whether want intended between as to and GAAP was a and be non-GAAP as we some think it's report, basis. a distinguish financials Nick's there purpose intended purpose operating result,

John Kuhlow

like We or just 'XX, 'XX final the are reserves prior claims. reserves as look like valued a point -- 'XX feel our insurance. David, placed we these at If mentioned, values And plays quarterly. out on period on were were I properly

have it is we our these going So forward. not that charges expectation

Operator

questions our at have we now will conference Officer, queue Executive remarks. closing time. John the in no Roberts, And this over turn to Chief further I for

John Roberts

performance interest the Good today. XXXX. of in performance think intentionally we safety. investment appreciate I the call and couple at very between and our look and business, our and feel We in results reiterate Mile there's would a I you, Thank what we insurance the the about Riddance getting like Goodbye again, Dedicated and markets. services With of is markets portfolio complementary very revealing in believe built and Great. a and and actual and to a claims disconnect the work Final performance the we're exceptions, our

our here heard that quarter I in I what would that in like use was year, And really around we tough lead a of Back talked have discussed but lot, to some XXXX. I remember the seen something XXXX of none our of Black can of at but then. much us in because lag that, of and year. through a who all like us work. In we're will and many that a don't Intermodal that can extra leadership fourth be fact, the the here. I'm fan, it, a say we've we're here, I tenure in I said rest XXs but rock about think and really it years, looking I while I decades that, look carrying has the got been glimpse positioning, in of JBI kind Darren, gym of

And believe 'XX, to completely I come say if, and we when freight think And as we see it We in believe a ready when, with guess, out lean do And to out than a 'XX. for so of. we I'm for of I recession, very totally dealing also needs harder prepping different had ask we're respond customers. to this not the 'XX prepared toughest, I and type of is ready We I normally do. are had question I'll to that year. better ourselves on but get of to come in the work our through strengthening we

strong think And care to that be our priorities, we'll of top I customers. and to very care of for and take advantage capacity. I presents, serve our people, watch that when in of our our have and take ready say, take extraordinarily we our to change would commitment improvements technology our people And are who climate. alignment continue just We let's take it while

and the to So good riddance. to this Thanks for memories, Shelley wrap I'll turn it over up.

Shelley Simpson

and supply growth play quarter that And And that's that a Thank around of for oxygen. John Roberts Intermodal. think years is exactly I And in We at solving want investments scale. long our over and has of is for long look customers there many challenges why saying saw term, some for said do you, we and into want it here, term. come to you know and built be in our John. are the us comprehensive services the more our their fourth that the that is chain more we

And and our have getting ready so spent for we customers. prepared XXXX

into need people, and in our our to capacity. grow our investments technology in we XXXX, in our Now

for ways units. do operational the sure why of it's we is the in value #X, with key will a that X. around can on value, recognize to and They to January separate us then That That started more we cost. as right focus allow our we for earn to believe our we business our best-in-class the of customers further our making that will that is our that will that excellence continue create priority ourselves X and conversation us have customers. and all a One

focusing Finally, that will allow our continue shareholders. to on driving us returns for compounding long-term

if growth. we would X to XXXX. But for because committed I remiss happy into moving not for And scale ready priorities dance those over, people a being lets we're key 'XX say march be remaining 'XX we're built into is So our as I did we're we that priority. and and us have are top

customers, and at year the of believe, and prove their They labor team Our other show harder long this for have people But over we this XX,XXX any our term, their our likely than sometimes doesn't do hard people my year, resilient. it in will been of least our paper. shareholders. so on year. necessarily of for fruit XX-year the career, worked fruit the labor labored for have have it They

that, For to interest. time your and 'XX. for your I you Cheers thank

Operator

This concludes today's and now call. disconnect. for participation, Thank your conference you you may

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