USAK - Earnings call transcript Q2 2018

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Operator

Good morning, and welcome to the USA Truck Second Quarter 2018 Earnings Conference Call. [Operator Instructions]. Please note, this event is being recorded. At this time, I would like to turn the conference over to Jimmie Acklen, Financial Reporting Manager. Please go ahead.

Jimmie Acklen

to Second welcome Call. Earnings and morning, USA Quarter Truck's Conference Good

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

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

Jason Bates

for Great. earnings review have hope in last Jimmie. release to our appreciate night. and today do opportunity support we Thank to everyone our and an us I you your thank all interest We the joining on of call want you, company. from

are profitability. Logistics a of team that to strong quarter. our the has in of quarter contribution a consolidated we segments pleased result Furthermore, encouraged was this balanced report and relatively by delivered both We from a performance that Trucking our the are financial fourth consecutive fact

please review If our million, and the represents increase revenues financial turn me for Consolidated X XXX and which quarter which to Slide per quarter, you'll year-over-year. with came $X.X Consolidated of for XX income operating $XXX.X was at Consolidated operating year-over-year for the results. diluted XX.X%, in net income operating the million basis points $X.XX was points basis sequentially. or of improvement an $X.X ratio was million share. represents XX.X%

improvement of are points key XX.X%, ratio operating Their decline operating XX impressive basis $X.X million operating our a of of of in year-over-year year-over-year a improvement first and shortly improvement a finally, Logistics sequentially was XXX this $X.X Segment Trucking we an reduction strong Their the talk of million made in generated proud $X.X Trucking an a XXX say sequentially. XXXX. quarter Segment million quarter operating points for improvement. has about of a the year-over-year drivers but was income of our team improvement the operational needless points generated $XXX,XXX to XXX unusually quarter Our sequentially. This improvement basis the million an is $XXX,XXX Segment. quarter basis entire second basis the progress off But the will second quarter. $X.X This for XXXX. the And XX.X%, points sequentially. of of ratio income USAT very and year-over-year is in James to and

highlight to liquidity measures. and me If Slide turn X, key sheet with some we'll you'll balance

the debt from credit $XX.X million June was total under June had million, XXXX, its March relatively XX, ratio of XX, stockholders to of company first as XXX from available The XX, was quarter. equity Net a leverage decreased represents which the debt million, $XX.X Total and XXXX. to X.Xx, second end capital obligations of XXXX. adjusted lease of facility which reduction of X.Xx compared at borrow as our and flat EBITDA basis point X.Xx X.Xx sequentially of As the $XX.X our was the again to peak XXXX. was quarter to

So Xx leverage with our was remain focused measure to team, that coinciding you XX%. the This on for new past onboarding and our we've successfully first between point XX number that a call, will a X.X expectation we ratio receive we and of to would in months, quarter. new quarter first committed out management the I the that we in keeping by an we reduce reduced on this over our the our second trucks long-term. ratio -- quarter indicated

unanticipated However, experienced have we, the others along with from the delays industry, in some OEMs. of

opposed as receipts. such, XXX As received anticipated new only in to the trucks we second the quarter XX

net delivery leverage to have trucks, and fuel economy, reasons, Although, driver statistics. expense temporarily did we take impact the preferred ratio favorably of would our debt maintenance delay new satisfaction and our the

fleet $XX We year. discussed a between year as net Delivery the to this tractors million to us investment million anticipate XXXX. expect However, for XXX of notwithstanding, time during priority still XXX for in to replace CapEx year. $XX last is top we quarter's call, full

I'll to pass the James. that, So with call

James Reed

Jason. Thanks,

to results, we our see especially in Segment. to the As Trucking past relative had and our own can a you second very the strong relative market, performance from quarter

now this a team, leadership in mind fourth higher year-over-year cadence and us is on network which business that Keep track. consecutive the manifest creating in performance standards. This are that story profitable in accountability quarter providing the we sustainable hike rate is a this higher model that with changes, is has opportunities, confidence a with differentiates Our dynamics, of people in business the self-help we improving structurally of results business, new new many several a results OR us in from are theme peers. seen turnaround that our

ahead bit are of schedule. we fact, In a

we'll market and much independent truckload an improving are helps, improving is what of of take environment. accomplishing it an While we

Base for week Slide with Moving increases per to trend continues increased week quarter for began sequentially. increased percentage to that Loaded $XXX This tractor a year-over-year network increased second for X.X% sequentially. basis revenue mid-XXXX miles or Base and improvement when the of now sequentially. in miles quarter XX revenue available loaded Segment. sequentially. increase year-over-year $XXX year-over-year X discussion XX the and tractor per sequential an XX.X% Trucking and per X.X% focused the or X.X% tractor XXXX $X.XXX basis and points efforts. and or or year-over-year quarter our second decreased rate results X.X% per points decreased compared $X.XXX Deadhead per XX.X% of XXXX, second miles per or available X or XX available of mile

and me Let changes our freight slightly mix freight has is increases negative truck in by measure. which our freight mix, utilization clear the to deadhead, to critical market given contributed changes in both for while metrics we positive though, tightening in demand exacerbated per in us these expected were driver impact most the shifts revenue targeted of The be all face, per that week, dilutive as market repositioning outcomes these opportunity in the in These a intentional both network. businesses and from as we item catalysts rate regularly is to maintenance are cost. investors yield be for An and highlight the have our should important and these we're tractors understanding of they in best of increase of higher increase We year-over-year wanted to benchmark in for costs not there. firm be class, for great an where dedicated our well business. areas to our

X.X years, Our average age at of the history. quarter the company's oldest fleet recent our in peaked in

address and an can We're this Although, hope help the with as The mitigate fleet back aging, X.X newly these aging on basis. OEMs get we year-end. age discussed on to OEMs had to has diligently issue working our our our the maintenance replacement the rapidly with had had ongoing fleet material anticipated approximately up more hoped our effect driving make to average rising maintenance the years ground cycle accelerate replacement ongoing of trucks ordered lost plan of fleet we Jason unfortunately we on in such a to that quarter, discipline receive by costs. cost. fleet the our goal We with to

require unseated the average X,XXX, XXXX which XXXX average tractor reduction The of quarter which X,XXX. XXX of quarter for us available of our our fewer industry-wide average our entering basis improvement challenge XXXX with compared this effective percentage an is near constantly was in of strong second increased recruiting and second points we transportation the points evaluate business second and ongoing represents sequentially. by to the X.X%, full regulations levels, and was employment ensure driver The Our tractor The XX every face methods drivers basis is is quarter from conditions X.X% count when to economy a biggest and year-over-year a of program shortage These day industry. new driver fueled the are refresh to shortage. efficient.

be on allow recently driver responsive to compensation. our constant more market-based recruiting us dynamic We've and continue also our market existing in and We recruiting efforts. be feedback effective focused through increased and retaining engaging to our drivers to program communication, overhauled to the

domiciles more utilize as we returns and more aligned with better of audience applications mix to for that our segment we're Our this good of drivers seeing consumer to approach geographic change actually desirable traditional onboard Early driver tools target are our marketing is a recruitment. on network. student better can

of we important achieve to Another us reduces retain in to workload the driver believe the drivers, lower which relationships to them our operations is build on operations This trust driver best manager and the recruit managers headcount manager more in increases in allows drivers industry. a to in and made with but much recently change the will the enduring ratio. team allow invest driver-to-driver we our

this to pay-for-performance. term quarter. The will self-funding earning implications will who as wages. increase driver the Drivers this be made continue emphasize later in expect USA to increasingly environment, are structure be and at will productive driver the to but to have Truck. Details the the the greatest combat long to arise driving truck pay decision we we increase we this potential over short-term have be effective forthcoming, have most Finally, our

large and to go we that to in advantage be believe not our playing levels to support own should market performance enlist opportunity customer discussed already rates of make support us our us that have who This We've in to concept the and of spot several critical via the in combination our effort. this of expressed their shippers our customer designed to with This the driver commitments. However, contracted willingness support this support to mutual expect driver we for the ensure for continued our motives other, results to organizational supporting customer as strategy increase, take-home it to discipline for drivers win-win stakeholders. is overall wage is customers have with we meaningful aligning each commercial through while abandoning economic a their is a this all sustainable, opportunity to achieved their productivity, believe implementing allows service. objectives increase and we high increase

of of our improvement As focus we primary Truck safety results. previously, have for the USA said the is all

Additionally, design we pricing to focused on a increasing network-first rates promote initiatives that business. network approach through our and

While week on the milestone more merely business class We via the our are per rates in are tractors a utilization revenue are have merit seating today best and among improve continuing priorities. in tractor reported and We to way per know top still our to improvements that go. journey. improved long appraise, there

This $XXX,XXX is of $XX the million. X.X% Operating $X.X unusually generated sequential improvement to $XX.X or Logistics Slide $XXX,XXX second in USAT or year-over-year quarter. USAT and million a sequentially. year-over-year generated decreased reduction. an XX.X% strong and This a income a off Turning a operating X. again, and now XX% or $X.X or XX.X% represents in $XXX,XXX improvement sequentially, year-over-year gross of million million increased Logistics improvement quarter. margin first $XXX,XXX revenues

for the of will in a from XXXX second in the XXXX, XX.X%, I shortly. the was percentage of address and XX.X% margin XXXX quarter first second quarter gross of XX% which Our reduction quarter

this segment. year-over-year the growth X.X% we A sequentially. have manifestation underway Finally, our and increased in initiatives of count load XX.X% various

strong Our while of to result to transportation a cost. These are contributor striving continues be to direct operating metrics business our logistics a our contractual to results. service market-based higher mitigate continuing freight purchase

commitments customer purchase higher business pressure add with longer partnership associated abandoning will We purely relatively freight well customer grow our and strategic spot Strong stable business. in transactions. spot with bodes resulting to this quarter contract for enable market volume Logistics ours, market for to customers term share stability. and core believe longer-term over and trucks market USAT moving to costs the opposed As pursuing in focused transportation margin and like rates the

Moving now X. to Slide

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

per per improvement week. we base The available revenue is discussed in first measure tractor

averages. the With an goal X% XXXX's to X% over year additional full of

XX.X% of quarter XXXX to remain second we the of driving XXXX, critical this As committed to and average, improvement better continued the are already metric. than

second will we results of half XXXX of expectations, committed previously exceed able this be are Given to our and our X%. year-to-date confident to we X% range

managed is closely percentage. metric we Another unseated our tractor

to below goal at this or keep measure is Our X%.

this the XXXX, the of As is metric our to unseated progress tractor of further previously year through challenging expect this real in the reflects environment call. we X.X% in quarter and second the recruiting some discussed count our mentioned. initiatives drivers, tractor the in of unseated of and percentage earlier half We've made as back reduce

to the our increasing -- an X% owner X% contractor is Next, independent through operator or count program. available of tractor expansion our is

on count by hit values $X initiative. million that are this identifying our leasing comparative X% cost we that XXXX And our XXXX. expect to $X increased reiterate million to have operators program. been growing CPM in a corporate We December is target through of partners We that We've by our since in series well owner to X% initiatives. with also reduction we ensure of basis targeting year-end immediately our to successful XX% ramping have that a one new in executed align operator a

was get or also which variable recognized, on on have comparative opportunities which driving to success drive front and over CPM identified we reductions. savings earned dependent fixed we this the slight miles to While largely many our cost date, increased already

key analysis enhancements profitability to on enhancement freight mileage to truck rigorous let this on at aggressively through initiatives combined However, drivers changes us per focus as has with time. driving more rate prioritizing mix revenue opposed

expenses achieve the the delays, half to are OEM remain $X target year, we cost year. committed initiatives $X calendar we but further be in in the back in the maintenance the a we such, may to light seeing feel of due to especially As million million stretch higher driving to the reductions of

Finally, USAT segment And total the XX% growing revenues. goal achieved XXXX 'XX. of get at XX% came our revenue revenues We've to XX% consolidated in quarter. remain of we long-term already to the of this of in this total goal Logistics to committed to in business

accomplished logistics new in leadership Our lot the in quarter. team a

hand-in-hand conclusion, business lead that on between towards predates delivering Finally team even implementation growth. creating trucking a our operations are discipline our technology standard segments a the to and us working my X Truck. at correspond arrival, proud very In USA operating we of with a will here that sustained

do. now consecutive we doing have by said X quarters what of just delivered We would profitability we

people, We our fundamentals have improvement. business the and process sustainable in improved through the in of network the

second expect accomplish which customer network ahead of way proud rates result a us in or history. as foundation recent in is for slower more on better per indicated XXXX, occurred points points in year which OR or this backfired are at the execution, so, plan. which that first of Year-to-date team to out which XXX the adjusted result quarter XXX.X%. We our of trajectory. the will in future. provide ago, the a OR in back XX accomplished upon after be right we the result, set we improvements, comps place will acknowledge basis structural We QX This but little XX%, improvement of basis within this consolidated points turned was a get-well OR or years And we're solid still we the XXXX, Year-to-date in but year. said pricing our market and build this we that best schedule. most spot improvement. is As that was expect improvement basis year tougher base XXXX, the through was we eye What we when more repeatedly on the is path of a which following our half the expect through than XXX a that we'd than self-help, the year for we is X our

playing this a has significantly market. spot the As team reminder, in avoided

the side. on customer Our the driven business than XX% is on XX% and side logistics more trucking driven today than more contract contract

schedule For we ahead at that ended XXXX, returning consolidated XXX an fair Truck full basis points that profitably OR XXX.X%. end we the year to a we in to least as say to are of of adjusted And half. profile. at comparative will than USA that off XXXX expect are better is a competitive great we It we first

satisfied these that certain with are be Now, results improved yet. not we

cycle need our where be. have network a bid to network means now. we from of it want to get couple That We it consistent saying where be. a We in mostly will be our year want we to we been think

from look a truck the are X-year progress like revenue year, our go while the at And have continued made improving on in we the on last So our ways have and help on in timing improvement they our drive we solid way perspective. still this we you which utilization, will -- we time to week. if XX% in they available our exceeding started estimation, where the per horizon way XX% of journey go from results are are we per industry to rate, tailwinds on of feel

implemented single more and we by our in we affect density than by positively densification we increased That network last largest mile positive the utilization. we while for specific and business and customers, on of bid said haul better increased XXX for Improving As total leads revenue number to fleet very our recently XXX%. of rate naturally quarter, lanes. and utilization. the actions both inevitably our have utilization. reducing our one doing have should over that believe loaded We length consequences we lane opportunity that will On alone, them run customer's per our lanes so of

managers to lead, better believe, well. team as outcomes better relationships driving between our members utilization thus and and in investment Additionally, support our to we lead more will driver driving

and USA front. relatively to literally of the have on outside described can to we competitive the the insistence of been been dispatch an We plan database disadvantage process top be But has Truck loads a custom Finally, off-the-shelf apps developed TMS. and as drivers technology operated quiet on Frankenstein This and company. what onerous an historically has system. best

As years new feel well lot with this. is we to of in capability so a moving And given of the we prepared expect Remember, logistics transition tech and who in doing, of positive success, tracking, that phase, system to transitioned business in from TMS the breadth now and be on recent brokerage the have updating opportunity. are the our a to system. the personally previously And trucking test bed of nearly the with in big project, and this XX our This utilization, will execute into quarter, deploying in we my system management learn I've TMS were successfully process to of impacts our new but with a on in exciting. in worked here, freight optimization the CTO working him TMS.

in acceptable, sustainable months. delivering think the me, over there XX team agree endeavor remain I is contemplated updates excuse do exceeded our expectations and lot that will has up sustained strategy a of most a it fragmented to results. a our effort will quarters technology, -- ourselves. this on on our And We financial believe internal competitors this the and in last remaining accomplished to to network Truck fleet, the to coming deploying continue already in runway but feat. structural highly executing that multi-quarter we industry, catch refreshing better give the with than first and expect In well have. disintermediate yet We To accomplish core you expectations. changes that at be completing of have one our even systems, this is be positioned simply already overhaul We closing to we and given gap is statements USA that, modern will

Thanks. Denise, So with back for that, to questions. over it you I'll turn

Operator

Instructions]. [Operator

will The Jason from first Company. of question Cowen Seidl come and

Jason Seidl

from I here myself. from a modeling standpoint. just Three guess quick ones

As for in step lot up terms XQ think was And -- from largely this year-over-year I a you of created year XQ was capacity on look it excess which should to to in guys. about I big a the play last basis in it guys? freeing really of we spot year up you market, 'XX. humming think you for How a was

James Reed

Yes. Thanks the Jason. for questions,

And I'll hit address the then So issue. Jason on some kind issues. of have modeling of business the I'll

So in existing of spot QX a more the We last in correction. the contracted slight played play just with we that What didn't capacity market. year surge was customers. really And environment. was kind

surge year some it contract, it's little -- a traditional now we is because with see literally and retail customers. bit our biggest, that new between our And spot than actually starting planning are earlier launch especially So did that of right we a this year. for QX last

expect rate half against double-digit which tough of in question as So intentional spot the kind way our play. planned than QX. in we We're customers, I'm hay even kind in second we're are your increases to and bids market-responsive little you a barn. a use of it's capacity differently answer is, asked modeling said, QX that the year-over-year kind it comps the of a with in play bit That of going not type modeling

to if a QX there, of to So be and we've we want but that? headshaked really the historically, I know I add on you going out little you done henceforth it I That seasonal part that, said something of we It's that's in surge. anything Jason, our know, going bit business of forward. played don't kind forever coming not

Jason Bates

hit it. No, you

be there the well. quarter to year key that we So I in think the this business is as is, fourth expect

changes would metrics you're year. some QX, And you about look in we as the this the in at move of you're the the you trajectory way -- if thinking QX, as similar so expect how from changes

fixing fixing our that say were the early year, and last would rates. stages I network of we Now in

from that last momentum improvement realize sequentially we positive were still but X, expect moved an similar able year half of to X in as back more this to we of the we was year. there So

Jason Seidl

in recent truck seated surge for Okay. a your pay to capacity. up that bit, of some driver might that guys assuming terms are expecting little you And free the count. help extra increase I'm

James Reed

not we're don't our looking at it I capacity. that pretty Yes, count. going core I our additional growing We're are to for know fleet way. that we level -- truck on stay

come are, I the drivers will to things. tangible easier is couple we'll to ones and to to The recruit where expect think a us have tangible retain benefits more measure of less fewer drivers we because better.

we drivers, drivers. are really things over tough that As cost opportunity of to turning the model those the retain constantly is

give So there's to got it a cost When new drivers in associated with to you be to trucks. the driver. prep a prepping to able turns track, it

You've also constant knows fleet the revenue their of your system, needs, shippers, outside your driver a your got managers. who

that more a data a driver us in fleet experienced is Our our driver. shows more productive

it go more those -- say capacity. additional I that's wouldn't So out more -- it that think we'll and where that see of than creates I

come more we Now initial bit where operator we that's And the owner create might expect a will to growth fleet. our still capacities, where from. little grow

Jason Seidl

enough. That's Okay. fair

You I'll about grew what here a next year-over-year. be net And to person. you it on expectations should also said logistics. for you bit margins our little touched And X.X% going forward. Talk turn the on your over

recently they call, on volumes. think Echo's like July was up XX% said their on I

looks July July So on us strong. they color for pretty there. can Maybe you started you how give some

James Reed

logistics. what say respect July, Yes, especially generally with to mean about I'll I

into QX. have You back go kind to the of

strong saw we margin and about comments, you this talked quarter, the market And my really see in margin so pressure. a spot there's And pressure when we in prepared rates.

contracted us so made what kind while on put happened pressure buy the It in we of existing business. it And margin it saw for market That's tough economically. quarter. spot spike, our to

we those super rates but and profile. into seeing spot as with seeing, coming volumes down, be in candid business, are we're not July, that As better margin strong we seeing move are what we're

visits this has you itself first -- will. of you long right calls of basis, if think the what it strategy, more our of these bit of and increase a that with of evidenced the And to should Jason have as in down. in you it. to guys compression. we're I in about, or behavior now a been that little less That's term half follow-up And we taking bit that a reflection we market margin and just you is our volumes think a consistent as are I kind that's think while have So about strong a we margin expect year. fixed little customer-contracted of spot buying is On priced coming seeing freight And go-forward think better.

on but nuanced of answer, a market that's the kind So going what's in today.

Operator

will The next question Ross be from David of Stifel.

David Ross

remain I issue in this guess margin much point? of versus you Trucking the lot some improvement peers the at margin a side for talking expectations rate on self-help. issue a first, But touched will about continued the cost and -- of how of the difference versus

James Reed

really good question. a that's Yes,

that the anybody now. rate to dedicated, So of -- are the best in information. And significantly ourselves may surprised price really available spot we profile, and with you outside be playing profile not of publically know guys the benchmark the market that we've got we're

If to third and think our you mix, the we're we're rate environment in is be throw guys good. pretty pretty close in We those second.

like like And home of so productivity the XX% a the got like per it we've -- what revenue said, want. misses is feel way in and mile where feel I per per is of of tractor network, rate we we We about Because is our kind to the your other loaded week. question it. spot want how we one which much nuance,

trucks. to so get rate more miles And revenue our is on really We these solid. to need need per more put We tractor.

the side equation. the of that's So revenue

pretty it's cost significant. the side, On

you We there And to going fact X.X. quarter, truck get operating have and average $X.XXX X.X XXXX this. you to take the $X.XX our that truck, that's cost of to a some to publishes benchmark just truck of to the probably the out years, there. $X.XXX end actually age X- A have A us over on to report on do opportunities the think illustratively, mile in trucks mile. we that or us goal X-year-old can It's a brand-new higher. really, there. has It's math down going -- out a and of operating we can into we that get plus the I has past But peak there. the mean take this a or into at cost ATRI data. 'XX had get yourself. to get

math that. million X.X, down amongst from our $X just on to a X.X about the talking do over You bringing quarter in friends, doing opportunity fleet you're of

on a hang that. multiple You that

a impact get sense realize, oh in from And OR that is But of be importantly, what points could OR it you the of alone. to up you standpoint. my just XXX gosh, to start. cost maintenance start at You the look more

we'll right be I running So the would revenue it's get as do table, convoluted. little now. of the I across started -- But a opportunities biggest is don't tractor way am... one kind that. think, that we our know outlined I X think week XX-XX we I And more in And more by per per say, to miles. we is the think cost second Jason, looked we

Jason Bates

of bit there. to, I And little just on color agree. add would I kind a Yes, of, James' commentary think

fleet and to something our it. methodical We going tractor it, careful your that constantly right? be something do is because as we fall we about how we procurement I trucks, -- want replacement bubbles not that also don't you on, the to in expense that temptation though think to aging the doing replacing even to be want and you're create maintenance It's be very work are to is go cycle. you're

to there are all a through things And are of saying get USA get. where as working here we've them. little and to been want so that's Truck. take aware time. at take a along, know it'll why, issues us are some we little very to we systemic that that But for time we going They are But

us there are large other We them you one that each a terms And are to as would doing maintenance address. of And were we're I another. them. opportunities for the one rigorous of after is behind contribution. not items in cost in analysis attacking dollar to aggressively There tell of addition there handful

James Reed

talked much all our us. has we culture We And of have safety. stuff done and improving financial fantastic reserves trust and safety specific get impacts on about about I lot a Yes. performance. we when doing into that But disclosures how your me which BIPD cost a job say don't

those the are of here. we this the so biggest to we have but take just I you program areas I bore never see don't to want a opportunity. as X where question, simple And And had kind opportunity tire with something and as details, guys in your want

got talking on Now it's literally about. somebody rubber you to that cost to tires right even ensure But your side the guys I'm managing your the may exposure. what not who's sell you've know minimize of rotation

the from I compared X a ops were so They that nuanced, realize to trucks don't X, trucks that the but telling model the that, the of on somebody to in stuff that's front on meeting, we know really off I'm operating you us do in it's to model rims to peers. me, rotating have ago, disadvantage that said you the team than rims a the is and market. ostensibly that, sways the it's And have the therefore, like our our a that of well-refined the huge essentially, trailers. trailers prevents our to rubber I months and are we subject and Again, different

have simple way fix go even just like having a to to tire program. stuff a long We

Jason Bates

with self-help us execute exciting the happens is, market, And Yes. gets opportunities what are the that's there what USA opportunity irrespective going that and about in investors are we on. Truck to for here here of

and on, executing do will been continue have we so. to We

David Ross

mean I you guys retreads are the on Have you or helpful helpful? any tires? not singles do found do super And

James Reed

program. about do But retreading but Yes, specific, sorry again, operational too we get I excited really get to these have so details.

immediate that that's As had brought this using on of finding have will the our impact tire our that we've the core we efficiently casings, has have on been essentially that which discovered relatively leader, a retreaded. is And new costs. not gets that tire immediate we an tire he

which retread And associated should going a more But so it's efficient, we do savings opportunities cost it. lot have to with direct a have program. get

are maximize On that are for beverage of singles. the super to weight. a lot carry great trying a solution and Super people singles

whole And any customers. have beverage. broad we've don't fleets have we a of just spectrum dedicated We to specifically that

singles. super run don't we no, so And

David Ross

just from mentioned claims number that revenue on of insurance then to a couple lower? good still you more expect Is safety, been follow trending Excellent. to like side. And and looks have down X%. Since about up a the you Do cost X% forward? say drive going to it

Jason Bates

Yes.

be the than do to growth been thing of increases couple But closer that, X.X% you make on somewhat we're just rates, would We've for that's to driving has an you also that, can our trend that but tire will for and we've type year as you is number obviously. where insurance vacillate made quarters fleet that top in revenue X%. revenue safe would especially that's where would There environment probably be something terms will I quarter-to-quarter, range run at you quarters. at in the only Typically from driving we a last line when that basis. basis necessarily investments that's have of James purposes the on. technology last rate the over the one to caution per been -- well. I truck the for somewhere absolute our look and better sure for significant one, in that's you've we're not a will the as public. to more that we've of X.X% dollar safest to and you ensure percent out to it to XX% in to that So or be week but It increases more. modeling on talked quarter there that it's miles modeling. you I correlated equipments there revenue work our going as when generate, and look over tell the And been drivers think about, per organization, we But motoring running of continue be

James Reed

have have Collision things to the take self-help mention Systems Mitigation this are. our other opportunity again, we said, but the the Forward I Jason competitors. on mentioned Dave, of public only it our X/X about has Now to to speaks to is that it. that fleet Because where of it, business where We relative that we've nature and done

All truck Forward have investments Mitigation on them. of will new our Collision Systems

end kind there is which that, fewer collisions are of this doubt rear we collisions the do most that expensive we no see business. As we in experienced

the February, outward program. has inward in safety. And better of to contributed recorder installation facing completed our we that Additionally, also and

a our in the CSA get of all other numbers the as X/X frequency severity we've don't although improvement expect we Forward have the of that safety better. we fleet, specific collisions to that and tracks we that, to only seen report While add Mitigation the we we the But material that experienced, of experienced. Collision

the about follow-up would we model from improve. how has ask as you right So a to improve continue a to saying that. Jason now to us to I expect is thing It year it. question

to the Now you're number to combating of to everything we down and but aggressive going continue drive And we're outcome. right verdicts. we're larger operational improve thing, going the jury we aside, that by Jason that performance. plaintiff's headwinds said doing But attorneys that are improved can -- to

David Ross

years in seen insane few absolutely have jury we past trucking. the verdicts Yes, over

James Reed

Yes, agree. we

David Ross

are over treating as to in your question it insurance reductions? When this get you install frequency better you or program an and for and insurance there don't benefit? self-insurance credit Or technology, any but the immediate time, you a is all rate of it. it or one to companies the add lower safety related How of the is expect trucks, these recorders you things collision therefore, your severity again. it's mitigation just Last where

Jason Bates

underwriters tell And talk I interesting. you I'll it's Yes, way mean, it. that about the the

our I the of measurable impact markets to loss-run these risk But XX And get placing for London these your premiums story. experience. The they next we Dublin example. underwriters. you. are immediate tell, that recently predictors technology. your in And we the in just in given were technologies told on our XX is of the and and -- trip the we investments have go same understand talking the the Jason to seen years realize we the change yet not not try story this last and in them guys process Although our good didn't year, on the There's we're years an insurance. story And investment

they it make your formula That's understand seem And magic seem and our in the policies. is. loss price have But So the conversation you difficult get We'll think this overall there -- and it through kind helps do that But very on not you oh, trucks. and should to it that. Forward Collision us and of reduction they it's no, of rating we're impact appreciate certainly they an the We to it's it run that point Mitigation understand. of XX they do on having. we the the tell have money runs. what is

Operator

Haimes next of Asset Instructions]. The come [Operator question Barry Management. will from Sage

Barry Haimes

received this as any And the delivery they catch -- think to when on going what you versus one new Question you of then how any you up? you feel give they to tractor thought Can industry-wide? second tractors is delays. have quarter And in to be is the or sense may able were sense us get? in some this many particular

Jason Bates

Yes.

hiccups had OEMs we're different each we've of from of -- with through, main receiving [indiscernible] XX. we are this talking we little trucks year. from and kind we've the snap received So issue. we that boos and contacts we've alone with widespread in heard And I've a seen in regard. two them trucks But receiving not in that anticipating And were it's XXX quarter, only got

CapEx even we it helps the ratio as to so have to would And alluded trucks. loved had our will prepared remarks, -- that's prefer have -- to preferred something that, though leverage in we figures, and have our I would we

don't issues. so with are us working we we're And our and expected pretty And they -- ground -- OEM our the with understand make and they be But to been in transparent have and aggressively actually here up to we shops partners our flood to up make have either. that. -- July remedy about it we -- partners, looking to want are making -- continue will already to And we are ground.

in. about have bring methodical things you how And these to be so you

months. that up X, make to hoping next over ground the we're So X

James Reed

So Barry, it's James.

just been crazy. literally do you these OEMs infuriating help have that where -- have give some a there all been parts. been which of of for have that that things had the color temperatures have not issues there but drivers properly, they working sounds with but trouble about that. that happened. getting OEMs, to There through at all work are the the truck for deliver issues the systems me trucks bit available have Let kind of idle actually There they, has have been, comical, didn't been But supply-chain some trucks, the most they with me different

working to out, to fantastic Everybody creative the We're building have get of Jason's and an same industry-wide just all kinds just trucks so to our get to that the figure bring. problems. help work your and having your trying of -- lots, the thing. that off been guys to their in CDL operations ways go in we're a to answer, question, go them it's is And I point in talk

Operator

conclude question-and-answer closing conference this his gentlemen, our and Reed remarks. back for to ladies I session. And will like the hand James to would

James Reed

is the a Satchel where section hope time. gave guys you will stay Paige I Denise. I Thanks, Great. you last quote This on.

the friends I mountains first their a for from and eight young Arkansas adults X recently in and of man lives. where Colorado saw group many climbed them to took Some of time and

and is our altitude As response that want really painful. XX,XXX And some for over the legacy great frenzy us. while No we made of no of But anniversary And in slow. generation perspective. Truck long. that our the feet, him don't assured in It let it. climber the I our book. you I that was the has I amazing the to before quarter. There made recognize asked its in badly American And was at are we the Ed top to XX,XXX wrote Top. feet top? it him, of one him, Ed trip, we Viesturs' laid did. real reminded I to the top. we amazing to to trouble least, this. how book do way to To have was, USA our to It co-travelers the absolutely His had opinion. a been would At was progress, do XXth best He the shortcuts him entitled, of Shortcuts me market to cloud James, was my at It was point, that's of want on get title celebrated we The get

step all at steps, come. better are making yet much even time, we a and one to the taking right than are more We expected with progress

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believe all at support reflects be and we our again is, have for week interest and the what that Jason continuing year this Truck. of look following to you in and for first us Thanks. model joining support that questions just for is may Thank you Our results Thanks that in and axiom. this additional I and of of there answering we seeing point. in And back. the many USA Boston will quarter's story. USA you forward September, of your said

Operator

you conference the gentlemen, and today's Thank Ladies Thank you for sir. attending presentation. has concluded.

You your may now lines. disconnect

USA Truck (USAK) 27 Jul 182018 Q2 Earnings call transcript