Earnings call transcript Q4 2022

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Operator

Thank you for joining Forward Air Corporation's Fourth Quarter 2022 Earnings Release Conference Call.

Before we begin, I'd like to point out that both the press release and webcast presentation for this call are accessible on the Investor Relations section of Forward Air's website at www.forwardaircorp.com. With us this morning are CEO, Tom Schmitt; and CFO, Rebecca Garbrick. By now, you should have received the press release announcing our fourth quarter 2022 results, which was furnished to the SEC on Form 8-K and on the wire yesterday after the market close.

Please be aware that certain statements in the company's earnings press release announcement and on this conference call are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements, which are based on expectations, intentions and projections regarding the company's future performance, anticipated events or trends and other matters that are not historical facts, including statements regarding our expected first quarter 2023 and fiscal year 2023. differ a and future factors forward-looking risks, cause results not subject and that statements. are expressed actual known those to uncertainties to statements guarantee by performance of are could or These implied from such materially and other

with update press earnings For filings to release no forward-looking presentation to these this and The as of to concerning Exchange company a obligation and information events new and factors, webcast Securities additional refer statements, whether information, Commission call. undertakes please or any risks our the and the result otherwise. relating future

During to to discussion available of U.S. their of GAAP measures most the of in GAAP. financial conform Accounting also tab our Accepted website. reconciliations not or directly press is Principles comparable do call, which there included release issued, Generally Definitions in are may measures metrics the Investors non-GAAP be the and that these

the Air. Schmitt, turn Tom call to I'll now And over Forward of CEO

Thomas Schmitt

good of Thank Brad, you to call. and you, the on morning all

things you And most for independent big industry keep service the of the commitment business LTL our damage-free to all thank you you our partners, in to a drivers and our the contractor with teammates, I best our thank intact shipments. First first, that. did

delivered top also our line, record year-over-year of a by business, You XX%. almost year bottom of EPS lines all in growth line with

the of our space. in top class that's So

and we to our QX, address more Now We still, we to peers, customers always expected, QX our guided fourth we customers did with XX year supported about going pull even guidance felt need had the better we good into be to top our we and not that finish In gave. than the planning way many guidance. that we contrast quarter, the or and peak efforts that. sequentially to our of the actually

also the that monopoly we have the not together. We to turned wisdom customers modeled as than in overall even sluggishness with the more had down more it in the actions quarter, control expected. coming than in and fourth our the that plan frankly, with we concert no single-digit up our way going demand, had out together we we would the and fuel decline with by shortfall ended Forward for though the economy for we XX XX% down. was Well, in LTL and we, up tonnage customers, make Where

December worst XX% January month was the equally XX%, and sluggish. talking was We're down.

XX%. The bit and we were story recent Now week, the promising. want week will being QX be to more tough. also, And recent showed at holds. most Still, weeks minus most towards high-value our complete freight despite still a tough, QX has a that drive the say, our I

are shippers. adding keeping all LTL customers. customers by We We're direct adding of actually our

medium-sized right now. QX, than small, in space, more of We that's XXX where have in number stable. the held they use were X.X%. And down businesses do We not by shipments the Even forwarders. LTL

also as is and pretty that Evidence last increased for XX% on freight much year-over-year. same release, we mix, The is the per-piece showed as better weight it's So that getting year. the better. basis, a in the

to went mix. And verticals, XX% that we also And of the of XX% in XXXX. Trade ago year QX important, higher-value freight. and finally, to of high-value looked by quarter freight paid mix last up our XX% now at and what's last the they our get four used of quarter a we be they're for freight shows compared

QX QX. XX% prior over per rate year is up hundred Our revenue

that of intended. And so a the lot had are works way out in we to the we journey exactly

pieces still than was end, what less less XX% quarter we we is we shipments that that used will the pieces. now to have have the caused The our than to they expected, XX% way expected, to fewer that challenge that we and what that have have, fewer they than right year significantly have,

shipment normalizing, normalizing sometime start QX, sizes should inventories be in too. that expect We and

do At Forward our initiatives of that the XX place. in end the day, We to not rely do have we on happen.

half talked before, about We We that of events many selling focused are on direct back. from them anything coming have growth. times more to them

and place. hiring down than initiatives cost reductions X huge months We freeze people are in is And alone also as in have XXX cost as force, a the have instance, that we and we that including a in Shape. reduction on for in Forward initiative by focused call containment, more well Game we're which last and also dimming travel, reweighing,

that is, can Shape Game our of target much as impact. initiatives we a of ahead point, that updated miles. sure just and Forward XX, to Forward We possible, XXXX still that's our believe part in independent Growth Force for making outside use Shape have Game for we instance, also we and Forward So we this At as contractor EPS. drivers XXXX minimum

telling will accretive Also, Air beautiful from our initiatives collective about we Express we model. headwind out called impact us helping but a bear please are to in company a down, up mind, minds economy. that. that's Land expect also EPS show with make that in the for coming EPS $X.XX sluggish did a fuel We of headwind that. $X.XX buy initiatives collectively from our $X.XX We show what us. the That's That's

tend know, in that of LTL if top longer, sluggish that have be would also as targeting. to we as the acquisitions, drayage economy intermodal And we in initiatives those keeps on tuck-in being beautiful well are you both as

the and as to can still addition well point, at that fuel as Land updated additional potential the slowdown in we EPS acquisitions, still XXXX. down ahead a initiatives going well the Air as So XXXX team as XX Express with we this with our believe target for of for Forward and place economic

with In EPS we to driving get as that had than in what with by that place models, very, members and starting that to XX% and on that ingoing team do or down actually an And of and top way, proposition. targeting XXXX shoot getting is initiatives very have can in the rather first-class we I'd XXXX. them an in close XX% our

Rebecca over, questions. turn back it and with to take you. I'm going Brad, will to So I that,

Operator

We're going with Instructions]. to [Operator Atkins Stephens. Jack

Grant Smith

Grant This for is Jack. on

of kind over in we've per the weight of on Just the kind big thinking of couple kind curious And volatility going forward? last are years, of seen about shipment. with there that reversal the how you

Thomas Schmitt

Yes.

inside because So this the of XX%. onion number metric. many order And weight something per shipment more and the a So to also is order pieces right? than piece just part but better that not the and more SKUs, combination talked people piece. last getting by It's shows is the here is freight down say have is they mix what's like shipment XX% The the about, than in for shipment, as better. the over in of good not unpeel you because still weight -- the several have that the than went QX itself the shipment. we kind still inside that third one of SKU months we per down don't two most That Then more see. our or shipments again, so the by happening shipments warehouse,

the it coming that down. of means of what high The math just together. there, I the of of lot up, number holding given is the the It's more despite less inside XX% kind less have pieces what is per essence, this our will going fact steady, fewer in freight of than actually And shipment weight number weight shipment the is that a going fact But shipment -- know the shipments currently of is of we quality. was that it quality in pieces be. is piece per so the is shipments there. what's is and a

quickly. coming on the And not that we're relying economy back

we being organic Air these XXXX, fuel shot economic the ahead Growth all Shape We believe down and map fact and of we five the on Game that Express in that the XXXX. Game and an docks we of Forward despite Between we're Forward normalize terminal growth to acquisition have actions, we Air in come cost despite third initiatives the updated, with opened all Force and the good And and a Express. XXXX pulling of of again, growth initiatives, just Shape, Land just collectively Midway, Chicago. pulling we We terminal in new Land got are actions. a our between initiatives, headwind do expect also

is The by per something is to want would we what to but itself see, shipment it we of quality need not be. it. down weight we freight drives So like understand what exactly the to

Grant Smith

a follow-on. just And sense. makes definitely That you. Got

You in of talked in try of kind quantify Could year. down growing a year half year how could break the expect you inflection maybe next kind XXXX. second that in earnings the of of -- or You about just and more positive quarterly? this

you quarter around color would breakdown maybe any could helpful. be of Just kind EPS the how by offer

Thomas Schmitt

saw for guide QX. first Yes. did is And that continuing quarter, that the we the in and we sluggishness

give but color let -- little of So just commentary. me bit a

which So target. still And $X.XX $X.XX at X, if And we a we initiatives that the of between acquisitions, EPS think can acquisitions, tuck-in we $X.XX beat wildcard $X.XX. for tend have you for this you Obviously, we doesn't Land QX. again, saw Express by again, guided and Air we to our accretive in you which control that highly we the multiply potential past came between we for to between adjusted still $X, that get XXXX. getting

more and more is it up. But ramping

to make this Land quarter joining is with standards sure Forward with. up working that in the there. But the quality us. They'll Express Air that's Express closely to Air is freight Land get that quarter by example, and wonderful that is the a journey environment an cleansed very quarter. We're us a expect work ramping we them by As gets Air to operating of team

bringing Most all Canada events about, reweighing direct, of equipment our that getting it's all Game throughout Mexico, out up of of that or and dimming is selling on more talked more and whether the in doing initiatives the whether we the ramping back, Shape year. in and terminals, side, of it's

perhaps going steam are looks it's a are taking the ramping while to all to going to it's lazy or these loaded, and Shape loaded fact bit is throughout back-end it second-half Game year. and up So be say, be Growth of thought okay, initiatives

would more QX. impact QX QX of and in you you impact So in a than see an bit And see more QX.

by yes, expect one and most those the the one. quarter growth being each therefore, a ramping by that of it driven initiatives, fact the frankly see we effect. you continuous this is first is ramping muted So do And

Operator

James. And can with to go Brown we next, Tyler Raymond

Patrick Brown

kind for color to guide, got Thanks on but I've the just I the so want of make sure much it.

maybe kind and So maybe can it you might of Air key you to and mean, and cents Land other $X.XX I'm are bridge fuel, but then but savings $X achieve? from few bad in $X.XX then rounding, kind economy guys can from three from in have the you $X.XX I another maybe that kind maybe call of that? that things, that there driving things think be of you Chickasaw,

Thomas Schmitt

Yes.

you right, pretty both both are got inclined. I exactly you So And the Tyler. math and math

guys So is the absolutely correct. $X.XX bad

So perspective, faster and shot in from than finished a pure year what of expected. quite math $X.XX, with the steeper not had for $X.XX we because that happened we QX what the we

want So XXXX. -- say we then $X.XX have we than in to and more

have us And then so sluggish or $X.XX against coming down. the coming and $X.XX the from the from from economy that's you fuel the prices $X.XX get-go, and

So $X.XX a up to of for $X.XX. now how get make $X.XX positive to we do kind that or

is the that we model Air in and have that $X.XX Express. our mentioned $X.XX Land for You one

and roughly, other Growth to initiatives. to I'm efficiency least and about still more Forward, a the at a specific bit Shape and effectiveness, from leaves XX-XX call Forward management. and Tyler, more that going between Forward which containment we moment us cost initiatives, get So down including initiatives, Game in Force get cost are have They the break to at what $X.XX the

XPL the on airliner $X.XX. growth of freight about to about medium-sized forwarder us $X.XX. items gives Selling forwarder our gives our some be core us businesses customer would more airlines customers. core doing forwarders, That small, use direct international biggest The that with do more domestic high-value side -- not

You on the have more and have Mexico. Canada and back shows more trade you coming

perspective in are stretching about from MT $X.XX. another that's We obviously, Nancee, in Mexico brokerage of of trade ramp That under doing cost shows, because kind with our existing So today and up backhaul brokerage areas a . that's both this efficiencies, a have gets is Canada leader we perspective, miles and new us and lot do $X.XX.

a growing co-mingled customers. Integrated efficient us about We're $X.XX. it's in to more means integrated final That's mile operate our for system.

We more BCOs about the have Forward an intermediaries. That's adding versus on up And side. the intermodal with $X.XX. drive to Force kind that's growth grow of impact of

between with digit last the where delta a -- brokered year. sorry, highly and outside biggest we this side, in cost-effective had staying we Shape year is an On Game $X.XX the one single miles single expect what at basis, $X.XX a

last to outside the Justin we Remember, in Tremendously today. We're well the Tyler, we to miles. X% members. were Ruble's by digits. we year, of managed by brokered remain territory And to quarters entire year had low mid-XXs where Chris expect team in Lindsay, in X% Tim Osborne, single

So side on block or side. that's the Shape the the biggest cost single management on Game

dimming terminal mentioned, of technology $X.XX, and travel, force. for system, relevant we the benefits We there the management, it's done pricing and another becoming we may got reweighing efforts to not Initial more we our to surgical other That those where a the and benefits pricing do pricing adds Cost of $X.XX the between gets quality us I machine expect ones us that enhancement of where more in reduction surgical continue wave $X.XX. two. actually to in then and in some be customer. service yet. And up have

Game the If initiatives those, than to and $X.XX management slightly growth real are slowdown between up and a add again, $X.XX real we're you and fuel the collectively cost that and Shape reduction add and do economic more more. willing these side, open the to that up transparent and very math be on because up to

a even so or of we if bit fall the two. we still again, have another And acquisition tuck-in short, possibility

and on add initiatives a we headwind have on we the Game are the is board. side up steeper -- if our their year, economic and from Land Air with with, year up are So opportunities this based do side is that's teams Shape leaders, that we on when growth has already actually and and last a targeting on longer, the additional saying again, Express by

at have but they that a beginning typically year Chickasaw, acquisitions always of always we come the of through, through. will tuck-in You and have know we -- mentioned also which we ones the couple don't come

Patrick Brown

for to $X.XX? it, on lower? there fuel is in helpful. Sounds extremely me were what fuel, Real was like prepared question. estimate $X.XX call It quickly on that you it, the or the Is

Thomas Schmitt

runs the this get who I'm to head, write top close , and So our my enough know it number. He of Tyler, I'll exact pricing. doing would

we what is So there numbers. I'll and tell you directionally do -- correct

that's by -- of have for Energy month, way. the do we best Institute -- is the Washington. it we have what sources So for there forecasting, by they in look if at They one the year and the this

people So time. we full We it have our this who in living by month forecast. do a X don't try to outsmart for

year around So $X.XX. we XXXX in more like average this number took on for $X.XX, That believe, I $X.XX. something was,

to drivers translated math we the to So differently. down exercise, have get $X.XX terms, in comparing point Once we about let's and works in headwind rough math $X.XX-ish the our actually employee model at $X.XX-ish XXXX. some $X.XX. this step by that XXXX where through gets a this also say, But slightly into

step $X.XX-ish to $X.XX down. a it's So

Patrick Brown

Yes.

of kind And back per helpful. shipment. extremely going weight is That Okay. to the

going you kind shipment stasis from you like XXX Is about the be you think pounds. mark? a be Or thoughts in lower is of can I build terms broad can Maybe And there. that? where could it that? pounds you're more term, kind just think is? kind than about that think per helpful. Or it it -- of a model, do current would weight? Do higher talk out this that's around weight any longer than be of of low Just be Do where should pan weight? you that, when to XXX-ish think I we think you So your think here?

Thomas Schmitt

is Tyler. sense My Yes. this,

is we this than at we Again, kind want probably of goes back bulk of into is pound if levers, sector. more few that doesn't of tuck-in couple saw pieces, where X,XXX, it we see pieces And is consumer to That numbers that get you quoted believe to, to the deal X way are. just XXX-ish early mark. So a the you low shipments where this and acquisitions. you fewer retail have, come kind want with the that I months extra would we fewer of way are and some your again ago kind point. will in are will correct. big we pull goods including because where you need more a we never that kind kind to the of deal with range X,XXX as But commodities and then as

grounded We air what be many is freight many, mean, being cases. in tend more specialized. this to to remember, be I used

and but or moves a there's between the XXX, Remember class space space, mean, hauls customers. are smaller an high-value sensitive for we XXX, in the some So freight of XXX our best Saia in But move. there sounds shipments, these Dominion were companies even difference in world-class when like and cases, good also, what more a what were some we shipments the perhaps a like I LTL company Old space a full.

So I that's think possible.

Patrick Brown

And Air. last one. just On Land Okay. my

it like here $X So EBIT. in expected to I'm $X accretive is million X. in year calculating it be maybe sounds million to

Thomas Schmitt

fair. That's

Patrick Brown

Yes.

So when the next talk what's you 'XX, accretion kind feel expect the I over just years term longer more from from about what story perspective. few and out benefits like would to of about Can you Air were maybe you Land of there's the maybe think deal? this an

Thomas Schmitt

us. is haul speaking, did has roughly you is year same They we're the What now some they're a $X competitor, a were of the part of that million, $X have correct. so airport is formidable line we million that They well. doing mean, airport part to I extremely Yes. absolutely us this number used for of company DNA. now

together more what freight, within to means also year way years, means X or we're into quickly. compact very, took going freight call us them the very with pricing operating tapping to do cleansed so, which a to for we're go-forward a high-value operating and What story the freight a a environment, to making base. try in palletized, which high-value sure here are we our then X Now upgrade we customer all in accordingly doing larger

synergies, out, A of I network some a probably cases, five and We terms some and based year. -- have that, duplicates lot the consolidate X, can Topeka, QX, our in where, do some next of destinations Springfield them. you of new probably throughout will in we including origins pointed of on we as get have buildings, and in we Texas. Express, into over Waco, it But Boise, ramp-up synergies -- spill Land so Air Abilene, X, X, see of

you of at this we Land if So $XX to $XX going Express, said million the between million Air look retain revenue. think we we're and

So that Game very that and Forward will assume in Air perspective, a and Land sake $XX argument just be similar for year. do standards Shape the make million from that Air

so So take more conservative. from a XX% about acquisition rate run talk margin to certainly you $XX half impact a or of that this be that million versus year. perhaps Then

Operator

can next, with And we Capital Fowler Markets. go KeyBanc to Todd

Todd Fowler

Great.

OR on $X.XX that much you're headwind? the side? So from coming freight that's as the about environment you the the some $X.XX be maybe Just on maybe assumption on the What Tyler to would the headwind with of break side get tonnage? the little about on headwind. thoughts bit as thinking just how you're expedited a Maybe The Can a thought fuel for how have you the you on side. economy. $X.XX talking that far what similar down that

Thomas Schmitt

Yes.

and modeled some again, basically, -- So we did this was macroeconomic do with what assumptions. we we

kind analyst Some on tires of us you with out assumptions. of are validating helping some of those and the your put and that the frankly, some kicking reports, of colleagues

with year-over-year the per day. finished XX% tonnage we down So year in

case the a steep the some we it's took number year-over-year of on effective but very And to tonnage with the acquisition better Express makes dimming XX% build number including the the cost Air months. system, and XX% that, we getting a But assumption. that kind and that. very, year, top that of running so then LTL at couple we -- started for our of first in or took actually throughout of of down tonnage as of force decline looked of higher we and forward double-digit year-over-year somewhat those the then up So even reweighing base rest Land a double-digit those initiatives, base impact and decline we the management off some

competing and very, kind we had that then points And profitability of work have that soft also to business in specific bit thinking soft customers margin with of we environment, the be a may in the there more area. what our in we winning about couple and of a kind was a very some down may took cases

extremely put We to pricing disciplined. every We had customer. in are going a this We still place be for GRI. single

discipline is going pricing the there. to be So

tonnage day combination $X.XX a with quoted, alleviating XX% smaller which margin it the of per points a it's then couple of with coupled double-digit XX%, and through Once percent model, the took we little was you But getting a starting that our EPS reduction being that run impact. bit -- throughout off. this number I year up ends

Todd Fowler

my peers, Got say relying some reports than it. our other are prudent all Tom. assumptions, of those I'd maybe or on

don't... So I

Thomas Schmitt

That's what I'm assuming.

Todd Fowler

be it got in to you the points freight OR only at don't higher I question, know want on the granular so to careful quarter model. back it this XXX basis when 'XX in fourth I XX I environment? this assumption tonnage, OR get despite in extra your fourth how I've move mean, you of 'XX, was falloff the year or a quarter, but You by What's the look there. basis? in Do my hold at realistic basis you for least can on points. see flattish got the full in what

cost a levers side. on the got You've lot of

expedited Just on thoughts through the maybe as OR we 'XX. any move

Thomas Schmitt

Yes.

because too, had conversation, that. think think -- So this more but holds, you and this it's challenge probably we on logic the guys just I flattish. me us let one explain I time, And but

trade, we business. remember, you show, LTL gorilla the said we our XXX-pound is main expect So the expedited inside if

but and with co-locating, to the need The so to and they and on. better other with main businesses are also show profitable backhauls, certain make their co-routing in be ROIC they thresholds, need above margin obviously, own right,

to But into we and XXX XXX margin XXXX, basis say we did in expect expansion XXXX. in going XXXX point

you've you twice so like about XXX If added LTL the at got we or were probably look points more side. basis margin that on XXXX, that. We

And inflated some by fuel. temporarily is of that

X.X, credit XXX sake, points So take expansion so argument's do come the not levels. get we fuel high team, margin for percentage being say, X temporarily very or XXXX, as for in that we, from LTL a at

the Same other around. is true way

Now walking fuel is down.

still if the freight, operate flat, we are we XXXX. quality it So the part the the basis margin of the the of business, still initiatives remains XXX and quality dim expansion that means reweigh, way of our to the Forward terminals, get XX the points way in us all margin XXX

on fuel flat you paper, show a of the piece if However, going to headwind it this be might in is case. look because

make get as for company we fuel, facto the don't but determinant better, want we but for a to We don't extra want credit de business when pound flat, better. pound we fuel to also look as and take take the

sometimes on basis a these put sometimes tailwind, its same the like XXX right almost it's it's in business getting XXX, is, it's So assigned, of based it is of headwind. in own better XXXX, and we fuel expect initiatives by and points XXXX. this in did test bit bit a a The

Todd Fowler

Yes.

appreciate 'XX thoughts the really how are can morning. kind you appreciate comments, around this fair the guys Okay, helped being fuel what prudent Tom, those all can't. about you I of I control thoughts what and and you and

Thomas Schmitt

and keep analysis. using you, we'll Thank your

Operator

go to with next, we Wolfe Group Research. Scott And can

Scott Group

the go for start monthly XQ tonnage really through just you Can of quickly and XQ?

Rebecca Garbrick

Scott. Sure,

was the tonnage about a was our down XX%. tonnage January, October, in down And decline down we're January XX% was November, end of seeing in In our year-over-year. in it XX%. December, -- So And through XX%.

Scott Group

-- the any have QX year for And ago? -- monthlies you do a you was chance

Rebecca Garbrick

I do Scott. sorry, actually. not I'm

Scott Group

get later. can We those

earnings want think Or headwind just I you all When that about, Okay. is in about that maybe could that any year-over-year that is QX? to -- mean, the I as it fair feels of starting in QX? really so about talked of the Tom? I there Is fuel biggest decline. cadence, that guys headwind, be I the think like biggest fuel quarterly the is QX that

Rebecca Garbrick

Yes, fuel in I peak at right. that remember, that the came like Scott, was It think right, time. June mean in. like if think, , all the you that's over was of point up I I of

-- headwinds. QX was is we'll those it think when I So see fuel

in think of a QX, we'll see I bit tailwind. a

you're think thinking. I your right So in

Scott Group

Okay.

GRI this Okay. than year. a last lastly, bit And then just little smaller I year's think

that but around and how color sticking -- early, so it's I just far? it's how any Just know it's

Thomas Schmitt

Yes, everybody let year. me same It we calibration, make talk -- the this yes, we sure the about the used me this. page first February. became year, The upfront effective Monday should here. one make to X.X% we thing on two Monday. I'm Always to say in used on And the last number And the -- comments here, was and that is first X.X%. is, going let just

big left we And and at picture look customers then look first overall picture. surcharge. we their do fuel is at pricing make do service others what that in of right, and actually is always Part they space as an we comment The as adjustments. our always

points. Scott, about in we that's the percentage did fall, So an late fuel X worth surcharge table make adjustment

package, in at and both we a the kind we keep at us. looked we that we looked to of works make GRI a of customers for we our sure said it So then space want and as where us

the proposition adjustment and similar bit So a That in of us here as year. last November we gets surcharge there's territory were between the fuel X.X%. an into end

if on where of that's with a that some veins and them of customers basis, a save with monthly can goes and real than tremendous good a terms XX%, in XX% that then job substantiated last growth mitigation GRI that us, cases, them, there's team in they key we meaning there's good this more a in more the XXX a customer the about several out? collaborating have where did now playing agreements and weeks getting sales can customers for is as of place someone and us do more by is are with how the Every it we track grow GRI. kind in over if And mitigation there's or us and where for we

We what's -- and And in GRI it is and value XX% growth always typically take have them in sense. rate, combination place last exchanges actual And year. so XX%. makes earned some where we at them a kind we we between the of year had back of mitigation in that's gave We that call those the this place. look of somewhere for

And expect so of with us customers and we fairly that have you commitments are So it's for even that consistent somewhat are them and to these actually more XX% rate than perhaps us. numbers what for should the Both or last you common good XXX saw take because plus year. go with a should GRI. of good expect

Scott Group

real can I then one quick And just clarify thing.

with the fuel the is of including separate? Or that is that changing tables? surcharge headwind, benefit $X.XX the So

Thomas Schmitt

be So just that this real is me kind This -- would number. a time. do let of net

and came at look just was it we So at looked we then year. what last down, it

safe from number, would include in sake number. X that with adjusted -- October that we down $X.XX would higher argument in step got fuel a if higher we step surcharge months the So down and then X or

Scott Group

that table, surcharge the So you what change it's including the surcharge tables? you're if been headwind benefit the would have of saying? bigger. the Is Meaning new didn't

Thomas Schmitt

surcharge changed surcharge we of fuel that the No. actual because last bigger smaller collected would the because be table, the headwind was hadn't If adjustment. year

So the now. down bigger is step

just may few the perspective, is it but way, a from -- cents. been math by So a that have difference,

from going to be this $X.XX $X.XX. So would

Scott Group

surcharge you I Well, thought tables. raised the

mind. Okay. Never

Thomas Schmitt

We fuel because of surcharge did. collected it. We more We did.

Operator

Bascome Majors go Next, with we'll Susquehanna. to

Bascome Majors

let made mix I think in you before go think some before. the a of like we now. used was investor you of what some to to like the mix of way shared that what a changes shipment maybe back the back visualize of bit around is the is little they And getting really concern where not look smaller it last to you again, look we're illustrative when and I little the weight going Tom, investor us where in were spring, deck that but terminals kind

done shipment size shrinkage and and the last just years. the what you can strong hard one today, this it's floor the we that to like? environment the if of back step So visualize the your over us help walk you've work why a LTL look not all were in on very does And terminals understand, in X

Thomas Schmitt

we like big about for have what the before today, to side our a freight last our of us and go-forward deck, that you better our just the that back is terminals looked relations because talked cleansed asking. like those part look environment. way, Bascome, palletized of in over I we Thanks, it days, probably for operated cleanse look all in By story in several that visual unclaimed high-value think or of the investor Yes. at they it of a take picture what our

I The stepping one we're to out, thing actually want back. not this. sticking with do We're point

cleanse they there. looks same What X is different they in the that or look look terminals treadmills the big as bit after a has unfortunately did if these year X you treadmills So high-value today, now in a will. shipment always it and X had at there, last

good freight, the looks are high-end like smaller. goods. consumer shipment They but just do there's We --

just So any terminals, when or some like of will to be to boxes visit from you you like few bigger. to those you you these see you into see a boxes what would a of like would cleanliness a perspective, see more one of take our

Bascome Majors

asset structural to the smaller are and seasonality? of IMCs reminder versus versus asset little modeling Maybe your LTL for today shipping an understandable companies? the exposures us it lot assumptions And walk time of you you some a segment making between using through basis pre-M&A? ports off, how spent that of we've a cap larger Understood. on intermodal So customer organic to IMCs Can on pure for light business non-asset in trend you're the the or the even reasons. maybe the

Thomas Schmitt

Yes.

-- intermodal goods probably So shippers behalf. is side, intermodal of our two drayage XX-XX. that their you'll And drayage -- there's see what ship Bascome, speaking, see on on roughly you'll the base it's half, the it's move customer not make that exactly segments. or are so customer XX% we

the have as The end customer. XX% that other their are so customer or intermediaries

both like these them of we extremely with We and work a well. lot, customers

work directly, them is really us. the with shippers get We and good some have this business good we when found that to really, of for for

call some directly. grow in customers, initiatives Force it customers they have BCO over the I actually we ship when things make Forward those, some before through a ran I of of initiative with growth that place. mentioned to proportionately and So

see on the that sales good force much more some of so our been that in as -- BCO growth also much, focused of you'll organic So will intermodal. some growth, has organic growth

for So absolute in And year-over-year organically. rate we're top you not the grow growth grow expect moderating. is line should is by need growing. yes, thing because not year we that's those the tuck-in but to acquisitions, one intermodal we this And organically also

happening, East we We had is last What we some fees, storage year, ports, on BCO the are, and were for things fee oversized some year, revenues of but said, though, we is detention specifically specifically just of as on storage coming the the normalize. also fees to preponderance expect the because do revenues Coast ports. were helping Remember, onshore accessorial mostly Coast come to customers accessorials, down our detention West I as business. fee, of the

used them goods we in get helped moved. for holding they could And those that. We many our facilities until cases

something So is to will normalize. that expected be that

So when growth is see you year-over-year That step on the the normalizing. you intermodal because accessorials mostly look in at percentage. will a down of business,

Bascome Majors

does perspective, expedited segment year? your And freight feel intermodal an full or the income operating in pressure plan, from for more the

Thomas Schmitt

much growing one in the freight sees is sees. as Expedited that LTL each business intrinsically mile slowdown probably the same Final of The LTL. felt segment. on not truckload three participants it brokerage does. in tonnage And slowdown that did. Difficult as appliance

this, a customers. phenomenal customers, new meeting has job done having new to done team just has final that said and markets logos, Now phenomenal adding mile team a example, take with job one winning existing as that

clearly of Carrier intermodal, -- away us two Appliance I'm But becoming those compelling more headwind. is look Depot Home this most if -- the but think, basically at The it's experiencing and I a taking of a winning is not expedited Year the experiencing That provider. bit from segment, credit any you Award helped segments, freight the

Operator

no And have further currently, we speakers, questions in queue.

Thomas Schmitt

thank We side, but Perfect. and And is team the Then listening to side. for to participating. any you about follow of what on all feel driving I'll on also effectiveness good I than just our and growth on be of you the willing very want the very, up more efficiency to say models.

to accretive, year less our And again, minds, for acquisition better I to And headwinds on there And coming couple than or the at year. end of Land target us up can even In last the us is acquisitions. with moderated. the in an initiatives we becoming model. We're with expect get a Express have have intermodal shot an good this the Air again, do moderated -- pretty tuck-in that's top that's one having already of Chickasaw. additional the

good feel how year. finish record about XXXX to we going potentially as up So another we're

So thank you.

Operator

Conference section Air's website Fourth be Thank remember this XXXX you. Air's webcast Call. of Earnings www.forwardaircorp.com That that available will does shortly Forward Investor on call. at Quarter this Forward conclude after Please the Relations

now may disconnect. You

Forward Air (FWRD) 9 Feb 232022 Q4 Earnings call transcript