USAK - Earnings call transcript Q1 2018

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Operator

Good morning and welcome to the USA Truck First Quarter 2018 Earnings Conference Call. All participants will be in a listen-only mode. [Operator instructions] After today's presentation there will be an opportunity to ask questions. [Operator Instructions] Please note, that today's event is being recorded. I would now like to turn the conference over to Jimmie Acklen, Financial Reporting Manager. ahead. go Please

Jimmie Acklen

welcome call. and Truck's quarter first Good to conference earnings morning USA

to Joining are Act meaning Vice the the and and from forward-looking provisions Act reminded Section Litigation us morning this Harbor of pursuant statements will call company XXE of XXA Financial Exchange Please Officer; contain of Jason that Securities XXXX, as this XXXX, Chief amended; Securities such made as Act as Reform within Chief those XXXX, are and of James by the subject Safe Section Bates, created are and Executive the Securities President sections statements Officer. be and amended; of Executive President of Reed, the of amended. the and Private the to

A end of to turn presentation measures GAAP now James. the will is slide on made. to at the to its Forward-looking is the statement statement. by on speaks measures, date it with those of from and which to today's consider be by Exchange forward-looking the the non-GAAP these call, certain may statements its differ could Any disclosures the factors Please of filings and uncertainties today's in of other over Commission. contemplated to the reconciliation results Also, cause company Securities other the review I the subject annual that risks future and conference financial provided press supplement GAAP are management analysis report actual materially the only statements. referring Form accompanying in financial and call the will in call. non-GAAP results results forward-looking and XX-K that affect on releases, that tables as

James Reed

release you, last Jimmie, night. from earnings to had our I chance Thank a review everyone hope

begin recent tell we already to more I our disclosed. have want you team additions about we management to bit bit a the that Before

respected President as week providing just Executive to well Chief veteran our President Vice that Guen most in our to the is is of commercial and solutions who member well this team joins the our Commercial Tim newest to service, presence who Officer. and Executive clearly industry customers. Our a us Tim and Vice Marketing known develop value as we at served His good Sales intend of team addition our Swift. signals and recently

long USA asset leaders two together. table like of of that our at with We served Senior to we most Knight prior immediate Logistics. as get Transplace. Vice to and we potential. as logistics comes quality of The of a people has businesses are of and President also as Truck, value what building He George asset addition ways new welcome in to our from here he has His President the the and can progress, can Henry Dedicated we team our Knight tenure Transportation Vice recently our and perspective with been us Georgia of had that volumes experience to where brought speaks of as testament our work these reputation the

underlying By positive in quarter began our tightening bringing quarter a again economic the quarter USA very Despite strong challenging and team also a results. first of a and We experienced normal March. quarter, experienced this by our correspondingly EPS start environment positive is recruiting events quarter. that Now our but but driver rising profitable over had momentum the quarter the separate difficult that in in were strong quarter result capacity the XX prices, has couple shutdown in restrictive quarter. fuel the and from the count in years. of trucks moving the XX a trend. unusually either April up that in success seasonally first logistics we second resulted or into ramped continued EPS benefited in last finished increasingly weeks together, drivers and in first we third slow its strong environment, and tight a weather only quarter and weather Truck since delivering XXXX of the delivering consecutive the last capacity seasonal on

our All market our of performing results companies has we one improved revenue in to forces. of is quarter deliver throughout rate, the team's sector. that This measures progress and the continued operational the become testament outpaced profit said to a and financial believe and to our best commitment in

long and could still done have a miles, noted While way we profitably trucks, feel [seasoned] it to we this are progress, not team's we If provided the that run service more indicates. more all better result with go. than have items for we pleased our above, more

more getting from expect ourselves are committed footing. business We this stronger and to on

year-over-year. $X.XX decline our to of ratio quarter represents revenues a quarter the turn was XXX for income Operating adjusted and XXX.X, net $X.X an adjusted now was operating three XX.X%, point at a Let's but XXX for million, or $X.XX share. income per points came basis an million Operating or results. of USAT points sequentially. basis basis overall ratio consolidated $X.X was for slide improvement a sequentially. year-over-year, adjusted year-over-year year-over-year this diluted of Adjusted share. And was XXX Logistics basis points improvement increase Consolidated and was per the basis quarter, look quarter for points sequentially. income $X XXX operating improvement at decline for finally, basis $XXX XX.X%, million, an diluted ratio Trucking the XXX but XXX million points XX% was the in net operating

four. to slide Moving to presentation our now on

we You base to the revenue miles are operational using available and our will available efficiency, couple loaded measure revised that note of metrics per truck. truck per

company be includes available changed better tractors, that contractor in our trucks, previously those [seated] including on believe our of tractors and tractors to denominator available we the Available are fleet. also As all in to the independent we performance truck all available unseated noted communications, which prior reflects are from assets fleet. dispatched,

We XX.X% change revenue of this on the have an tractor that and exhibit per a metrics. variety look miles Base earnings tractor back two helps available declined XXXX, release impact week to a included versus fourth of increased year XXXX. Loaded as per the clarify X% available the per $XXX or week $XXX or first versus the of quarter per quarter operating of of 'XX. of basis fourth XXX XXXX for quarter decreased of XX per to the 'XX percentage QX sequentially a when first or compared points XXXX. quarter compared when the of of fourth quarter to XX miles and decreased versus the versus miles Deadhead four-tenths X quarter last year, per points percent tractor, tractor and the basis or X.X% decreased of available first sequentially

of unseated XXXX reduction count of XXXX. first quarter an XXX of Our driven for tractor of contractor X,XXX a quarter reduction represents percentage first XXX average our basis points in sequentially basis quarter tractor or the is which seated points of for X.X% of X,XXX, The owner our by XXXX to unfavorable were X.X% predominately was versus and compared operated which independent a fourth year-over-year quarter average increase average an the first the improvement XXXX program.

through quarter, last our remain will focus our stated rates our we and increasing initiatives. safety, improving As pricing and has targeted network's been first design trucking

I'll to who position. we operating call will our business give utilization Jason have industry on top our metrics priority. turn update tractor you improved over on now as focus and we tractor maintain comparable and to an our improved several financial the While count logistics will metrics unseated

Jason Bates

Thank you, James.

decreased load from and net XX.X% result marginal percentage Turning or with million seasonally a income quarter. strong XX was XX.X% year-over-year $XX change represents $XXX to or first year-over-year year-over-year and at $XX.X X.X% count. million XX.X% year-over-year Gross per at increase per per flat Logistics or per generated sequentially. increased quarter The XX.X% combined XX% of revenue the XXX.X% or the basis points sequentially $XX.X in increase and of worth load XX.X% in fourth revenues improvement five, sequential $X.X load load, million essentially Operating $X.X or of load for or sequentially. was the slide Revenue income, the XXXX USAT million improvement. in million, this $X.X margin year-over-year operating and increased

March net X.X XXXX, to December net debt and compared times, decreased XX.X total of six; to of XX, were stockholders' adjusted XX.X The XXXX. XX.X XX.X XX, the available XXX as to second Total of million. had quarter was XXXX. credit at of sequentially slide equity capital basis obligations March end of a times million. to X.X of from lease as company was XX, peak as cash million EBITDA million XXXX, facility X.X borrow our represents times point its reduction and the This of Turning debt to under

between XXX anticipate net XXX XX XX be in year. will As million XXXX, the fleet this with expectation of replacing in reinvesting full previously our of we million. We tractors year CapEx to discussed and

to of the back will We we With and go continue X.X ahead to invest in pass X I'll forward. goal the fleet target James. that going call times to a leverage as

James Reed

Thanks Jason.

going I'm Now seven. move slide to to

will the report priority strategic on in key our a remain previously quarterly As mentioned remains we safety few will always we targets, and business highest period.

per full-year averages. an is The the available over goal per additional week, XXXX's first in discussed with base we to measure of tractor revenue X% improvement X%

prior been The XXXX. be for makes business. to updated average are available remainder of believe than first whereas X% is of Note discussions we we a As X% accountable committed change and fleet XXXX remain of to of basis better the quarter clear us trucks. we based our per this trucks, the to originally terms calculate entire the and on understanding measure X.X% that more the XXXX, of has seated of already in the the range it throughout

or we of of keep metric drivers. percentage quarter below and X.X% of as With our unseated tractor unseated recruiting is we it reflects at percentage. environment the a challenging XXXX goal managed Another tractor to is first X%, our the closely

but we our we driver that of I was a just about we Although is in there. percentage carriers term average XXX, are can terms last turnover I'm don't happy Recruiting it that's our other under with than statistics of unseated a count XX% say morning truck steady were the X% to year retention than drivers. progress outside report so about is as our retaining making better and about challenge disclose this

we category executing of in to XX%. and that reported last available report are financing leased contractor I'm and through X% operator increasing the purchase contractors. quarter of had that will a that fleet in partners happy the that been expansion get the program. successful engaged we quarter first have to owner are to We to growth is Next well XX% offer believe our who help program options goal this from term we very of independent we truck for positioned in count independent to new longer us or X% tractor now

We a targeting are million corporate on basis through CPM a in to $X series $X cost comparative also a million of reduction initiatives.

as maintenance team conclusion fundamental We we is to our all of get have products world-class three revenue improving committed opportunities of of include to cycles that to before a remain of underlying our and people Examples be And we reopening said road reduce Truck, lot we and Holland, XX% to in each Terminal revisiting as the effort throughout to our quarter, In our of national in need a couple South businesses execution of where would this to of for our on to fuel. goal was organization there XX% get in point business synchronized agreements profitability Illinois and quarters improve. USAT consolidated the additional be. well over the network consolidated bid engaged Logistics to leadership consecutive finally We've a the us wanted assembly of USA revenue. proud cost. to a long-term the the

tailwinds help is estimation, will solid outcome utilization revenue to that made we we've While improvement utilization. drive tractor our industry have exceeding the one in a go We that on rate in out continued believe progress improve critical still per we available improving better on ways as our week. per densification which network

lane density, the reengineering since improve already have network. the XX% We

concerted CPM basis of be managers encouraged the so day. also in quarters with and our cost the to slightly fourth have about. reward low year-over-year in like a [closer] of in to emphasize high first will fleet believe further, that because be on quarter the $X and volumes that and driver delivering with that on digits summary. results. single in we around over changes X% we are had fleet result wrap yield the and maintain fleet every our This marginally in see already grow gap our drivers as in and close expectation as are they utilization recent [separate] million helping result, means redesign our the refreshing now spoke a to a as costs with the network market the that But to We the consider we open the $X to they [pace] digits. I year of and a increase the you'll rise continue robust improved a pay third acceptable seeing to with that in burden year the cost questions well to come experience, drivers the perform competitors in and second on effect as positioned prior front opinion, we the that No quarter as since hard after of of in hope in for call we savings began made great are and challenge work job improve efforts I'll feel can then we business we've private additional reduce harmony first Add the rates logistics sustained but weather a and is improvements, above and the last could with by all April. doubt and forces cooling through moderate double to we a increase million market the to I our will rate is older comps year. just A net the the this Jason the stick driver a noted, Brian, market we third Costs because been have quarter. we're beyond questions to initiatives target not seeing ago have in ongoing we'll to up a financial positive over

Operator

today question with first Brad please go Our Stephens, Instructions] from [Operator Delco comes ahead.

Brad Delco

give your that of XXX performance a know about talk should could don't to so on but the OR us relative over be what was more the the was was little we if James truck some bit expectation. the you really was where you that driver quarter it color can to that maybe load a extent first performance. in weather-related or surprised the maybe I

James Reed

I it Brad. Yeah, appreciate

it's mean talk structure. reflecting an an think remember business. of improvement I that business to you from was over the of whence we marginal basis came load XXX important kind I about kind year-over-year point when truck improved

helping Our accomplish to was that. network price helpful in very

was, go right that many really did which weather and business right but impact we have a times You're the we're less would good idea we ratio have the that a the operating EPS we than going cents to pushed have XXX a stuff, was what you're interesting mentioned couple exactly how we There's in to in that that us to quarter. pretty into the not disclose thought call.

corporate talked because We higher tax higher revenue. a kind a they and percentage paid adjusted allocate that of we of basis the also our had couple dollars way we of just a about they're

given those reasonable. a have business we XXX better than considered is it think performance which historic, is pretty that been would So things

what our add. team. know and thing you pretty other plan to where just while go back The his want internal you is to and don't plan, our it Vern outperforms to you was I'm Jason actually disclose expectation the we with pleased so quarter anything first started

Jason Bates

rates hit our right just spite point that they were internal strategic that that the and to made it's market. driver right, to spot tough going I trying winning partners win. game again to in just they long just the business that opposed tracing headwinds all a a weather tracking as playing we're we there quarter other at market have to quick get was and that with And about and they're have, of you contractual here plans

the about so we'll we the that back always game XXs. the that that year But as move to playing that realistic QX there. long quarter keep expect we're is the And into seasonally and unfolds in because we're mind turnaround be going being see toughest

Brad Delco

this your what within point what -- maybe of -- again can contracts way in then to represent the be second, the that is extent cadence truck you, there cetera? be et in will us give Got you when a is first quarter, on third, go of any effective kind loads will

James Reed

Yeah.

opportunity half and the this works of make our cadence see mentioned the half that's re-price last break think sure some from in goes. market We does retold year and plus to minus we to course that the know quarter. quarter So XX-ish or different our in folks. it's being know of to consistent. the We it a as half, each great a you actually half really information other we're rebid and second for business the of about few out I points business business percent first us

of from about and results forward these of our in kind to that you so promise are going first the we pretty leading rates what quarter as be to conservative under for the we feel model and QX reflects there trying look and QX guys year about we talked been we're And about deliver over has that and efforts forward. last this but year, we good

Brad Delco

maybe owner us housekeeping more for Jason. a the first for Can of you one operator quarter? give count then And average what was you just

Jason Bates

point some that December there our owner/operators in in our our January. first low eluded who owner in I but operator in in say to change and those XXX from partnerships count average for leasing the quarter think the was talked strategic as had will last we our we with you Yes, call James so earlier quarter and a I about of provided of period

XXX. that So quarter exited so throughout quarter, the than built definitely it's the higher we

James Reed

of striking Jason's the number XXX. XXX update go bottomed at and last as at on out a week from it distance [indiscernible] of that I out was had out last I'll And I'm limb,

you momentum of some entire give been to are that there today. classes and regained I'm as week sure sense our Just that's this the exiting

Jason Bates

clear in currently April. is really April not March, where we picked being up in need we Yes, it's so in that here to that be were

Operator

of next Seidl from comes Cowen. ahead. line with the Jason Our Please go question

Jason Seidl

with bit cost a is tractors about on is little how recruiting to you and talked your age the go you Guys on driver Where refreshing. fleet maintenance the that item? going and important to line do think also the the

Jason Bates

of watching the details is this mile. it is running and fleet so too hasn't it hefty analytics much on the older the done into pretty some did that of something we're cents cost we fleet the like I will say closely. item. Yes, multiple pretty We've without getting aged We around last line year maintenance per

everyone excited And as industry advantage looking that trucks to opportunity decision don't of the took so was. We all, do fleet are that new that. these in but to we into the to forward and we the get regret at doing

X,XXX So of commensurate you the so and we've a swapping fleet the that volume we year trucks that will see over to going got as -- are are course that the X,XXX that out unfolds. quarter move down age average year of to

James Reed

haven't of But that don't little I past, to been being in apologize. I'm it are we I respect with longer James. know this at going look that say, this that run some a of things bit term to color its this recruiting, Jason recruiting in there turnaround. how disclosed to probably helps the add but the to Then on I think structural business of driver a than the importance Kind it biggest other to is

from transmission a getting large portion remains drivers It's from fuel a training problem are also from was the manual was of fleets we fleet it transitioned were long Jason automatic standpoint a it training before a of were recruiting here most strategic standpoint. only problem So I decision as That's drivers. economy a trucks. a and the made

enhanced this it fleet access And able importance is to help tapping adding driver driver amenities be the also our structure, driver a us then on had so time to a how will as the these we're turnover. some also help efforts we're the recruiting We important fleet some hard of to critically test trucks, into. pool cost automatic it of think to because affects will we the that transition we'll our see we that transmission to but it's and doing

we part of critically So plan. think it's our important a

had you, interrupted you sounded Sorry like a follow-up. I

Jason Seidl

would on it well I some little when was sell to bit the just know no, I I is No, because affecting of also thinking harder you side, manual about than is manuals a imagine as the it's automatics? mentioned resale this so values

James Reed

of So we the which everything are do there quarterly so right reflect in We got there. appropriately specing appraisal our entire of booked the fleet no depreciated issues and a the worry actual helpful market. and be us is residual that there. a the meets But truck term to values. about yeah long needs of retail There the for to nothing interests have it'll contemporaneous trucks,

Jason Bates

valuing little that year or of make making we're books, entire the picking got We've bit take valuing on we zero We'll to helpful. active been have appraise credit try we sure gain fleet part and right. a to those our it we're any a have booked, large asset has sales we pretty and with regard is but agreement, don't gains market job twice that if truck sure some our losses. which doing the so it's appropriately up Obviously our a been used the appropriately on appraisal we're that

Jason Seidl

wanted at also its peers sort how the of in should the ratio follow-up USA getting if Truck Okay, of sort to investors there? of the terms that's James cadence operating look is you What Jason. your target you posting. mentioned of here, closer enough, and getting that to will fair more longer-term

James Reed

a fair that's Yeah, question.

ebbs trucking plus before the kind that So Van said to as Arkansas. it's this history flows like other there But these at company possible want a has to of and do goal, the XX Buren, into markets. should run and from of XX the over to bit term kind market up we you think I carriers, first shown where us OR years structural the expect will here also in in on what business high space, time, tougher down dip be little ebb to the long of of is like on I a calls and kind to just our XX XXs net-net some of balance,

structurally. of look So that's it how at kind we

other terms of Jason and it of cadence there, like I'd anyone and to fixing, the things that are play like the we think even kind In said process we're There for that I touched structural you it's of of a to that's we to things all about in reiterate guys underlying listening have earlier, us. but and on getting instructive along nuances talk it's understand. for long-term rarely

Our freight That network a is We driver got our I-XX. network. substantially strategy. more to north domiciles of of takes transition, I-XX weeks. on days part but We south years, than I-XX of to not are driver it's it densification into is our south domiciles of and transition got

So that into would think we've said the have get expect bid kind is which carrier we us of of two we cadence we little of a said about to be, give kind us XXXX, XX-XX said couple mid-XXs years kind before. I as maybe cycles. as you a a

on And are we have tailwinds our we're so the feel We steady with we're as there but right what yeah much look pretty here. some throttle before. we like guided at track results, on

Jason Seidl

some That's always. time colors. I Gentlemen the as great appreciate

James Reed

Thanks Jason.

Operator

with question Instructions] And Please Stifel, our comes from today ahead. David go [Operator next Ross

David Ross

equipment talk natural on give Thank what's good on age be right average you some now? as little the the we in to hear a of Can but the truck you, going here. color fleet side, bit

Jason Bates

it's X.XX-ish. in now really range that so didn't it's be will we now, it's X.X, aged was a bringing in. I and QX age we But said on right average X.X our bring XX/XX any like of trucks quarter trucks as in So

throughout to going see are come as year. move quarter you that each So the down on we

David Ross

different down to going the a other OEM specs fleet drive any you average as side trying vendor replace on the And age new or you the doing are anything and fleet up?

James Reed

nameplate So say one multiple Dave, is that's missteps we the have strategic because interesting USA would at of for company I we years. a been Truck really many -- question a

we're no didn't have trying so that fleet. nameplate in any new already the And we not

moving long-term. brand we fleet that toward said two are a with Now

So we've in it. in be to We strategy is lot or reflects what year benefit investing there say this I invested forward. of will should going think a that

guy. training time standpoint talked, guys of You not from idea like an my an of I'm componentry the one for to different of brands. old having and of specs. set I inventory versions idea the carry the manufacturing have same one I specialized multiple I like and on kind

we is help strategy taking the to actions that us And the year yes to that narrow are this so down. And get nameplate strategy.

Jason Bates

and and would year I that's actually the of and our respected. to year is He others to eluded inspecting Yes was add on well as is in has very James this of just brought we we and leader very a he maintenance that, new he have a our TMC Chair of lot Jeff of on so a knowledge this this involved front Harris. equipment and and

decisions representation of But very somewhat we what the we trucks are are identically. in that are of this of and going year those have about we couple inspecting good to. all ones big we the over our two similarly kind the years next then And to do and make some want go who to we're so of going three so we're bringing on of nameplates that couple a fleet

And will them talk going James or are goal systems and about international, are and more avoidance the have in the mitigation freight matter to truck drivers a want our so can sure outfitting whether that's I best no forward. we and with a where a stepping that that work, liner collision make idea similarly we second. into here you But

James Reed

[Indiscernible] to collision of add little kind would the bit on my a just Jason mitigation. took I Yes, that. there

consistently we in-house that We have the done of us -- business about of a I what OR actually have run to done the think it one it me an in idea takes front we've study management our of areas and prior for where part of front. collision mitigation are is not is we quickly on insurance of forward competitors And rest as industry. the more the we that did and the as public expensive the adopt because at than

USA name a Truck just on on. point now get public. call And the responsibility truck's cost. trucks safely have kind our spec forth what to our not protect It's and of every the that will and name we forever to in about god Jason's our of hence at So third be people that and given the motoring home of in of to it's

So the elaborate on for do size. that an thanks for to opportunity me

David Ross

next leads place? miles is claims Well down training to driven are programs safety it other much following XX% technology collision going to right into related and how that my with would you mitigation me X% and putting new question insurance and versus be just

Jason Bates

was all know I think I claims. Dave a year took IBNR this here owned But reserve with a you of million we USA were first adjustment quarter but I it Yes, the I period can wish was prior a associated say function actually and Truck. $X.X last avoidance name before in at collision the

think in So then that X.X actually took the to we total was and get prior in period more X.X well. there comp of it I year as

And non-operational of so safety say unusually don't quite public to employees insurance about got insurance of a claims large frankly. expense is by some bit to safety the we've motoring and importance corporate James. lead little and I want were discount because operational year. -- want of there was But I amount obviously in there pounding but care the taking don't being expenses the is and and but and he I'm our safety a team the regularly strategic last on

initiative And huge so here year. last the that has a been over

that. see that you make to transparent wasn't improve we and wanted to be that But are as we to that remiss as also that to would I some related sure insurance we took large I the full item of make say prior period on So claims of it well. the aware wanted

James Reed

year-over-year. crashes at The again report of about this improvement I miles we that better seen premiums so mean per and counting I metric a is works and XX% in as reserving on our million in long under kind a it's look were on way operating this tail internally lead over overtime that. and the but can we've manifest that there things itself and Yes performance talk not will

David Ross

facility you at did maintenance it I going down to as so severity there you that on. or that because you and same is going comment think easier why on quickly be of to has over in mentioned just do mean in something I Yes, that, go maintenance XX% do also quarter, else fleet should and the shifting the was and it's side are structure do house improves your the more time. because in to And as frequency

James Reed

of Yes, is so couple reasons that. a for there

terms So the our bringing just did we and our we've heat density of a we analytically and now network a parts the the the the repair in understand road. domicile over is a where right coupled where in our have house can expenses and buyback over now one others drivers ROI are with team analysis road significant of we of expenses, to the assembled fleet driven runs rather we really on gain enough first on in Jacob's and of experience map what than

from more had ago right weren't actually prior few is repair as they facilities done facility road it the a that it the often the here just closed the we of the in reduce But and much changed lot cost do throughput this density put management network, some we're years in-house the right time to some other to and say by analysis Commensurate now a so math. location to as enough network that be that will Now we comprehensive just mean concentrated there getting looking for to with network house decision as have the and we've locations so maintenance network. over around in we've the volume made make our was clear not thing it's the our the actively the in analysis it's was facilities in and the enough and to justified. as the seen of in cost particular abundantly reopening analysis and further [indiscernible] kicking I down analysis volume company this sense us and and diffuse networks through at

David Ross

Excellent

Operator

ahead. is a Instructions] Stephens. from The [Operator go follow-up next Delco with Brad question Please

Brad Delco

solutions leadership that but growth Been for what there and profitability really really a what the in per we of I a that is earnings about revenue strategy driver business quarter good year. different or new in the something big the for is with strategic really was or revenue the capacity got on lot load feel to questions of truck like obviously think about I ask

James Reed

I'm glad because have we didn't we one question. say only

with made. to of think address expectations these and we relationship some our better anything. And of and we've this so lot and stuff higher our right name Does also capital in we uniquely some land enhancing expect under [indiscernible] your think well gain of we invested well is actively the and standpoint important summary time us just logistics are gives very feel harder business me customers not put we to psychology a a by week And just you if who our those trucks to the to if expect to in industry than build phases it time. to walk customers drive think I and do were people is really a we identify capital margin of opportunity multiple volume get other like down and by some expecting but don't some our trucking margin quarter to trucking room on right rick let and think more yes we we so up history the we get normally it industry pretty initiatives I From at in this volume successful we doing we written other. working going we've see we've people if so I was were little last been lot we written go our logistics capacity the competitors mean thereby margin new we from which then long-term this base our now. and two an that take deeper would OR the that be in can is from were of in people to like kind before opportunity, expect less differentiates But in unique got push grab of on say position compared a and to group got hurt Paris what customer changing we more a groups the as strategy to really where way capital a can recent volume some really but pursuing. is now a the between margins we've to trucking this side from much some bit think volume. and like just loads do stuff pretty kind in that leadership think are find drive other the business a follow-up But the that interesting earlier with the really an in said is change at price like company's strategy questions that saw it I tackle margin up the our performance the to look but compared of we think the this kind playing continues right in what margins exceptionally and didn't go I and long-term couldn't ones to businesses and to say it more over at I of leadership is first able in trucking and contribution and a liking it's we So that missed for couple to logistics ask this really compression, business so boards our that little this on is better our so we aren't so change we invested the Jason for deeper of group team that's to service collectively, strategy and content anyway is of a handle bidding do we might reiterating are and side that to in logistics with and our working co-pathetic trucking there started

Brad Delco

of the hit think thoughts more and you you to Got what's of get a trying the sort growth that year to comps sort or XX% is or type is either from expectation. The little throughout kind you. pulls something moderate of as sustainable then XX% you you of specific maybe of spot but market think type do little off bit maybe that bit the

James Reed

first it’s Two in part answer, pretty part reasonable. is QX, yeah, think I the

really the comps year. year last so of up had it in we and first tough are remember picked half a in You QX, considerably the the of really QX the easier we year year, back half last the

and on the expect half depends to the would you robust it I quite this be So said market of the in all that this, not temperature alluded as second right.

from just and is So naturally but others coming from us not get much you the well growth, market. got of from you the revenue growth as top

will cools the slide take at cool talking be volume revenues, big but that kind our it that George year, volume market building room of that will on don’t was this we such the happening this the top when build down a And through the down in so job some we back line. it revenue got it's don't this. at going to while our that to it and enough with see we yesterday It's on job, point right us now, some capitalize point

Brad Delco

the makes up. that time, Got appreciate follow sense, you, appreciate the

Operator

follow-up a is ahead. David Stifel. with Please question Ross Next go question from

David Ross

you, just are and the that's did versus flat where side, now. thank they some, of inner down to end look you company we what's Yes, growing you've you coming the truck on the year the or the do side, up the operators the expect of given trucks back at address if year out been be at the to end how but CapEx

Jason Bates

company flat fleet opportunistic there the will owned said our much we're So sense. right to That pretty we truck is the are opportunities the and capitalist on plan makes if be side. keep ROI now where

James Reed

truck got to down unseated still into before you're adding. And of that get you course X%

Jason Bates

effort the out that XX to you've team great walked get go Jason we don’t getting said to and the so with been the is you're down a about drivers to opportunities more and on where more past because it we that's fleet, the because capital right need have doubled on of number to there's exactly trucks, that we decision reasons easy of we and expect there. be, when to trucks working that, to meetings. that really we've like have our recruitment the Dave unseated ask pulp, get we're market me Vern I for opportunities in so X% are kind pounding sitting under this my almost his explode seating I'm mean down hundred, it's lots that head's there board right, to it's make That's reality for or about of to trucks it's

David Ross

And trucks do then larger, some they lot in keep environment. for them are, which back to the get How other and sure everybody this of competing theme logistics you're but much you which you're of smaller. much your brokers, haul on this market, trucks customers same make the committed loads in the is and

James Reed

you so that's often capacity. the won't seat investors I the freshman the on of on question, game supply just rates, fair the and under best terms understood competitive class of other will to your side, tell got and capacity not you of this have price is capacity Econ a side, XXX we're to your the get college. a getting and from the people to is others in demand It's name business year the industry It going commit, so capacity cause in

said more to basis is so I fully this model leads always the and five also customers carriers but table we win ultimate times those your that take experiences speak this over apologize word non-asset in to where else of an programs we said quarter go I density increasing it have. and barriers in reliable you regulatory asset to deepening somewhere drive the customers that around our or assets is truck business environment use We out reliably where some even just you've just finally going it, the the rely from logistics be on the head but some take then have about will and end outside we we've at to an had our we a a think and reliability business the the when challenging got kind customer happens things on they're a seeking that get look more to really those there, specific consistent we that lanes initiatives in in got is see say, logistic have always I've identify to of one forces customer logistics was And there carriers that's punitive this performance, we've long-term care carrier building would in they what play run it about we is of bit been per has reliability mentioned relationship where when growing has contracts of performance specific XX to this Georgia think the their and this can business. but of it really relationships understand there I people economic the for more used are markets our relationship that entry, change carrier that again the volumes the on the theories to is is trucks are of consistent little to there on I the way the in particularly guess sure some day to if consistently guys contracts having a can of we tonality were positive advantage win. about the

business summary, think to got consistently logistics and was question. of working them push so in the And partners we have volume reliable believe our capacity a we've that are fewer that our more kind customer relationships more I we helps that, to where in initiative to to be we use bolster again

Brad Delco

enough series you opportunity not in reliable of trucks think ask other market. that think I your are talking and network about about lot over that dedicated in the shippers this for you the so just dedicated the or and road are it or are time. that customers is the internally you worth just Is and something of next And Other dedicated distraction there week. much one-way reliably talking

James Reed

that run business it at year business interchangeably, very sustaining a it positive offer very specific sometimes our has as to segment our when in those a in and the have trucking some the and business been of you've well-run initiatives resources, good overall do No to dedicated business dedicated ratio. frankly, yes needed dedicated as substantially manage truckload support operating last we part have it we look dedicated got because we but can runs

Brad Delco

guess many of fleet And this be be trucks how that? would what about roughly would talk I percent dedicated or

James Reed

that my of about do operator the are to say owner we guys We talking size. talk about about we're owner enough it's don't XX% talking it constantly program same not where would it we dedicated when as that point kind accounting roughly example we talk get ambition and grow that have separately our separately does got for ambitious start fleet I but to we've what about the operator and to about yet. talk But the grow there at we

Operator

conclude over This our would back question-and-answer session. will remarks. to Reed like the I for conference to James turn any closing

James Reed

Truck joining Thanks XXth its Brian, next celebrates and thank you all week. for us. anniversary USA

of with great business years been results business. our most has the of a profitable will steady those has at hands be [indiscernible]. founders comparable been a XX For this This believe highly we and been

company and we said once than in [indiscernible] young more history. company old USA Well tell how old incredibly new know feels perspective. and the old new isn't have after you an he any be lost a with like a its said he he asked like old didn't XX was. We years new let enviable leaders its if play fourth. this if attitudes, that major a but now new feels XX first ideas, means in much we results, As new by decade leagues you very you but could me Truck a processes decade would new how when

and and seeing York, following may many additional you New Our like we for May have and look joining back and our said words feel motto to truer this XXnd, then, for year and forward all been there answering spoken. I will be of just USA is is us is thanks. what of in story. Jason again and XXrd questions never you reflect to we have Thanks

Operator

you today's attending for presentation. much Thank concluded. now is conference The very

lines. You disconnect may now your

USA Truck (USAK) 27 Apr 182018 Q1 Earnings call transcript