GATX (GATX) 19 Jul 182018 Q2 Earnings call transcript

Good day, and welcome to the GATX Second Quarter Conference Call. Today’s conference is being recorded. At this time, it is my pleasure to turn the conference over to Ms. Jennifer McManus. Ma'am, please go ahead.

thank joining and quarter XXXX everyone, call. earnings morning, you GATX’s for second Good by President Ellman, Brian Lyons, today North joined I’m Kenney, President and of CFO; America. President Executive and and and Vice Tom Executive President Rail Vice Bob CEO; that you’ll during Please today some our the forward-looking of consist statements. of discussion information note hear will results trends could forecasts. or differ or Actual materially from statements

or or Germany. and year-to-date for $XXX investments. release. the the maintenance quarter million, XXXX negative associated our are million, the of impact share of no to diluted Form XXXX refer included any or marine in update For million risk GATX’s cost of Rail of the XXXX XXXX reported XXXX. net in $X.X XXXX. share $XXX.X the of income $XX.X income to of to please attributed income $XX.X compares in per year-to-date million, planned statements Earlier $X.XX subsequent majority This facility of $XXX.X or revise XX we included with net of in reported to or associated same per million, results detail per second page XX-K diluted diluted to more obligation diluted GATX period closure diluted reflect earnings exit approximately assumes second These information, $X.XX $X discussed factors for Year-to-date compares or quarter Car or share. second circumstances. or a This net share Management's gain quarter to share. share. million net GATX forward-looking XXXX Portfolio with events second per results quarter in $X.X $X.XX per $X.XX per today, of diluted a

address briefly each will I segment. Now,

environment. Our a second improving results of are business gradually reflective quarter

success certain to commercial over rate favorable Car industry renewal persists, utilization XX.X% North resulted Rail execution increasing our in the team supply XX.X% second end at by relative America the XXXX. fleet and to metrics of Excellent increasing were to Rail rail While quarter.

of change least renewal negative term with During XX.X% the XX month. an index was GATX's price rate the quarter, average renewal of

still fleet. environment, we improvement our lease is did across in it see sequential lease absolute a rates While quarter-to-quarter rate challenging

successfully from and continue already railcars order from place with customer We XXXX cars committed diverse our place a supply have our to agreement. base X,XXX

our We scheduled is have the customers already of placed schedule of quarter QX earliest delivery meaning XXXX through of second available delivery XXXX. in

market income quarter America. million, We continue approximately marketing income year for to marketing during essentially active North million North our year bringing Rail secondary total to the the expectation. full for capitalize America's in on is $XX.X was railcars $X.X which

the are GATX's within the the second fleet we with always we XX.X%. active improvement be and leasing half modest opportunistic. market Within seeing railcar increasing demand Rail activity is utilization in any experiencing Rail market, is Europe International, While size European the to in will serve. steady very markets across

and approximately the release, our of in closed Car the we quarter, pretax maintenance second noted As expenses million. facility Germany in $X.X in earnings incurred Rail

and continue India. third Europe operate volume with in of second to close investment Rail a Poland. to to million quarter International the a investments $XX.X in this full approximately service immediate continue as attributable our We during provider in to operate facility was

the primarily We Finance Partners performance are Portfolio year. on fleet results of of track the Management's excellent to Rolls the by India end & the double Royce count supported in our by were Affiliates.

deployed. quarter residual segment in with quarter. sharing management currently Company were American to and well second higher performing fee the the by results and the within performance of down is XXXX, primarily is XX portfolio activity Steam $X.X in earned year-to-date RPS profit Quarterly from remarketing both driven due vessels Our XXXX. Ship segment operating the million

higher season, While season. increased level has the ASC there were in and the more earlier than water beginning of delays the demand difficult experienced offset ice conditions initial iron at ore for the

release, we on benefits per improving full remarks. earnings the impact year-to-date. closure increase the our Rail share. a to Germany. in prepared is noted are year guidance any diluted As and raising the are range earnings This our environment Car from maintenance $X.XX of based XXXX excludes guidance in business This to our $X.XX to facility Those

hand we that operator up it questions. So so I will for open over it the can to

question from first Allison comes Our from Instructions] Fargo. Poliniak Wells [Operator

you railroads Any to issues what flesh fundamental having of a your thoughts base out versus on the blip? struggling this you maybe -- are near-term there? demand guys, and velocity. are is good Hi, -- of side improving. due the some Metrics really with are morning. is operational think what Could obviously, But railroad sort

oversupplied, hard Yes, the exactly road tease that It's piece very that trucking the switch driving going out are really ability over that is Tom. what on this supplied truck not is but congestion overall, you the the a and absolutely now tight what's problems, to factors is very difficult. with coupled is to of right is -- right to trucking fact rail is big

see in of definitely variety that you a So, car types.

was ones One boxcar up have it strong talked we historically about in where our and for is have fleet our that this most shows seen that of you pretty boxcars fleet. quarter the the

major piece contributor that to is that a -- that the So quarter. of definitely

over Europe, in you region how on that VTG Got and are thinking past with terms the valuations news any in touching dynamic so forth or near term? just weeks, about it. then few of And change the

looks sure hostile situation. that's release VTG, VTG news enough all. our -- Brian, The it of that's first it thought almost the Well, it's We press new. in like It's and was

changes but like concerned the the about we that. know that Germany, unless like with it new the they rules works with are in So, compete ownership obviously not grows I something in way uneconomically how really aggressively, don't market

type. the time, than across is we in time it full So, see have that's am utilization market that’s But first the fleet for point am we year is a the wait and coming what higher XXXX I I long expect just focused that. Europe, a on not utilization on into to in and on. focused improving really so higher

And and so is good as and Eastern XX% say our is Europe utilization rate chemical first rates locomotive resulted last cars, it. and approaching of and which market, good other over lease in lot there in in demand as for look if obviously, are the would shortages that's is even a in meet petroleum, started number once that There XXXX. accelerated driver last petroleum The absolute highest I rates and highs are Lease statistics, of to for has to in of up. consumption year is up recession with absolute that at year, old surprise have climb there chemical actually pre-great positive going reasons, up. little quarter and actually production just in is materialize renewal a production bit for time started car Europe well years. anything have refinery index If starting big again I a fleet demand are Railways is in seen transport Europe. the cars we late seen in you strength XXXX, a demand the accelerated the is struggling is the up news such also basis in utilization prices capacity up exports that of third in which on variety especially the

been over in last situation than is Europe the just more attractive really the decade. it's So

moreover that's on going focused what's So rather VTG. on than

you. Thank

next Our come will Kubacki Kristine Mizuho with question from Securities.

was My this inflected question North pivot a good positive. like duration America. morning. on looked like Hi, little It was looks it a in Obviously, it point.

just any what kind So if the comment given if think you you has for lease on duration about rates. color full the where LPI you confidence of expectations is your to -- for going balance obviously, of you well? the changed the year talked as go have And then could But year? about

others a -- the improvement to but Okay. and car car on would averages, lease the I types, rate are we short term start seen term. though let so, will we in continuing have go they types chime below general turn are indeed wish, of try little most to I long-term on majority lease if in for even then

of little have driven and would misleading I statistic of single wouldn't or term In at it can One there, bit things number transactions on of caution looking we anything longer, statistic a on read that going be small LPI getting a general going to term into about the transactions a still a each longer. a couple what's is quarter because trying the little are influence than can everybody that quarter other we short.

experienced better to first is the Bob. your question. We I in the the on metric. in Kristine, that of expecting year or will more in be this done the clearly the second year. We've negative -- XX% half LPI, the came of to part LPI through results weigh

than the moving across will So getting better anticipated we very little types than are for bit that activity. will terms up what's sure, predict what's early for for to likely -- commercial faster the moving difficult year coming things things timing full renewed, given The renewal, a we how do are of now. renewals, right car in of

So predict the will better year, the but the the beginning second do of the certainly to it's we half comes where a -XX of put than little we difficult year. LPI at out in out

facility. I if some German the wondering closure provide helpful. of also that's color about maintenance Okay, you could was the just

I Yes, can do that.

high-quality Hanover closed but the in for quarter. Germany number just work cost facility relative has in So, producing it a disadvantaged third-party GATX to Rail second that years. been was of facility network maintenance our The

more They So work will in try business to attempts make it close ultimately but redistribute numerous to that fix to decided an they to that it. were elsewhere. made effort competitive

facility, what second the that quarter, XX the that about means closed employees. affects So we in it

the a Workers management in So [Indiscernible] facility. is currently The the at on it negotiations wasn't huge Counsel social plan. with

charge job severance, reflects of estimate for affected the costs. that and placement our employees those took we cetera et best So

in the it done redistributed as that work network. far was third-party will into be As just that facility, that

Thank you.

will question Long Justin come from next from Our Stephens.

and morning. Thanks good

I had question was first the XXXX So on guidance.

increased know bit But assumptions. that more year, could more you You was there. the that expectations those some detail of on on some at beginning I the driving key you a assumptions are if wondering of the I color little gave give your increase.

saw this if key I also component just wanted then ask down but North We quarter. pretty may a of maintenance. American material could you the step curious So that, point be items. this to about a to And

for So expectations just changed your curious that's the full year. if

certainly Sure, let that. part Justin this Bob of broader commentary a and me on but that, a is give

of of say we in a really all, a the into is would increase reflection environment than across areas. I and that's guidance favorable business all year, more First coming general the anticipated

the that's significant one could change no in know the really driving to I item -- So point guidance. you

Rail than International half we and and favorable already assume first of up there couple had Also, year-to-date. the one the and that maintenance more which would see However, of more as the Part of a the the expectations go second those, environment with has bit which plan our Steamship run favorable items of American year-to-date that and of anticipated. with won't really expense anticipate Coming expense income with the of repairs, is year tank continue. timing were up that and are the the has backdrop, which half activity, through you of line year-to-date, of favorable railroad a that due and little is generally we pace second into the qualifications we've year. that it year that maintenance that year not coming in we run as will scrap into half we've will commercial some to expect during of mentioned we catch

So main the those are drivers. really

And couple a follow of on maybe up to those.

benefit as Do American revised estimate have being for think North about the the beginning you at X% well? scrapping you of year, you any you X%. I up is to could of mentioned, how that much that there is a on way and maintenance quantify talked the that piece that

Sure.

on far and front income there. we So total had North the of US $X America Europe scrapping not and that about million being it's year-to-date anticipated

end quarter were the scrapping continue will at quarter a be higher loss. of second had the will marketplace. our as the saw activity them the types advantage getting and some that second noted and but than scrap that they been remain those Now in offset we of off in by high-- in of There rates scrapping the terms are cars of some I scrapping actually taking first were car those as we half, at are of disadvantaged

realm some have some of gains So And million We to the those the or certainly year. about scrap by overall That's of of would a then to range. terms possibility. maintenance in pickup offset million that X% lots. $X.X the be would half during quarter-to-quarter $X within will net anticipated expense, it probably expense be up maintenance scrap see we end the that X% to up of in did need second of in

probably of maybe be so will X% that And off last with we number to year. X% flat

first positive half. we the again, through will half catch some performances see So, second the the but in up year

do helpful. wanted I railcars last really look obviously reverse better well the asking it And That's in to and then on pretty the and and Thanks. because question follow storage, when peak, an what noise Allison of start in I we've on with -- was like little stabilize we and think maybe industry given data demand slightly actually we that a trend what's a has on-- some earlier but the getting bit about or trend me, see up could the better meaningfully new the over emergence much from the service short-term last half. in happening for seen it enabling see back numbers rail come stabilizing sounds down guess this months the just based you to two at market getting you just is

Yes.

railcar talked So for one of year is of that we this up quarter loadings America. a stats North which are in about also the X% versus all the yet about ago haven't

railroad though the lot railroad low we cars earlier, talked A in So, in days the that is your that haven't quarter, of at continuum. demand some not the standards, low-end. XX% this pretty to signs. it several number the there historical still velocity moved to point. That are addition XX it years with positive that and of on good if the the it's has is by pretty-- you overall about been performance by again driven into compare little still It's even change been last

seen performance the the of the year. for expect situation the-- of loading in and be with we've least in I at of pretty first XXXX, consistent half that to would So rest combination what the

comes question Cowen. next with from Matt Elkott Our

digits? that you you. Good I color improvement. modest Thank you think, sequential maybe give you few third the guys morning. quarters low improvement I spot or rated a the it single was quarter I consecutive Can rates see lease lease the more fourth us lease-- on about last where question a had noted. this is magnitude in in the believe pretty some

Yes.

varies XX% at things about freight summarize always seen of that One is cars but by to the than this cars what type we car overall talked have XX number try first more looking when improvement we've been around quarter-to-quarter that seeing. is it sequential cars. Ten a

the freight up of move to beams we've little flat, are For is significant freight seen causing bit. it's types in cars, but very center just relatively Most car whole area up which improvement a freight slightly.

guys be housing center where any since have I just and XXX-- to this of think given you that know center time Got think ordered CN Do starts? beams adding to gets will you ordering it, is those XXX speaking has of manufactured the XXXX. car I beams, this first plans

in but, we investment on certainly the railroad that the so it due comment don't some is of types fleet car Yes, again of performance. the that is to but of part performance improved, individual

So it's eye going an some keep forward. to on

XX it. seems the this remind us to many cars on any that that Got XXX, there be in the crude Can And specific are at moves have point. actually deployed how are fully and on our front? we fleet, guys you DOT strategic hearing you

Jen. this Matt, is

in now. We have about and service X,XXX cars crude right

crude going Crude again, pipeline. limited. in we most as we repeatedly be to by far a think as about is efficiently moves talked rail our-- long-term And we've very

and area going So not to wouldn't it an investment lot a do of forward. of investment expect in a done lot we've that is

it. you Got much. Thank Perfect. very

make that I point investment all other is the The in is crude in XXX. DOT

you. Thank

comes Our with Baudendistel next from Stifel. question Mike

Great. you. Thank

question. Just wanted to follow up last on that

about to specific that talked do rail. that's you by higher, I been-- the that of mean-- just were would competitive parameter? type that mainly briefly rail but You their crude by of get rates by be I you lot being crude want tank doubling know a in rail, about know those crude impacting tanks of type don't what's talking XX%

statistics Yes, are we the general flavor rate, deep is talking LPI without about everybody activity. you are rates, so in a rates have what new a to too the lot rail; we or existing crude pretty car It's a renewal going just into by renewal about, that give fleet. talking don't of

for we many crude rail commentary. rates the So disassociate that I talking about, would are by

ask mean to renewal there cost? the and previous it the have that's just like you agreement manufacturer's existing based But time you-- extension in I where different the fluctuates the production then Trinity. it. of either anything do with the of than the agreement did clause there Got wanted the you -- on

Yes, that more a supply to have so customers is we basically for what that we we four extended extend in there years. order consistent agreement source is our of for it did all and did

it. Got

half Just an for remarketing do an said then previous year you, year, to -- the income for ask full just is updated of extension. I have that? the the And first wanted you you your number mean expectation,

Yes, going as are change types on so the working it a size not activity from else year, we material from at, that targeted do anything on or at and are small like car in the we it's nothing largely marketing to year-to-date much be we the here for we done opportunities, would see based packages where really relatively certain scale.

Okay, you. thank

Bergner will from & question Justin come with Our Company. next Gabelli

sort helping is to way, of from taking any that $X, what sort to lower the the midpoint seems of some just to increase buckets? across I to I out are management. guidance another better there percentage roughly mean, want utilization things sort break you It a everyone. increased just percentage those it are lot European is of guidance of in of possible North way approach segment rail, maintenance between portfolio of mean different business $X.XX there pricing, maybe the better this from morning, up Good America, increase of I given in is like coming the sort buckets?

bit obviously because difficult year, expected there I'll where ASC American of do environment. it's the and into of coming from a would International mentioned half but second that to North a do rail. little are significant. number is the improvements of It's And pretty we year more be bulk than of, lot into a we but I modest expected, coming the incremental in not I say would both favorable a the Rail better

comes it down really So American to North rail.

You hit maintenance one, one. one, number being the another scrap on

other is The year point our thing right coming I expectation to would we though much revenue out that are very the into is online.

revenue North to expected down basically to that's X% midyear at to That's be be expect rail. we full American where are We and we X% continue at to where year. at

cars So evenly it's renew little though the even bit the rate environment because throughout better a year.

a the get real from into don't what coming expectation the movement You impact was significant or year.

top-line So in two rail. biggest are scrap driven. maintenance better. Those American performance, North ones side better it's of Again, side we seen not have the

the that helpful. high seem I so utilization you're it is-- being mean little of anticipation Okay. But into the the maybe That's is as becoming at would bit least revenue fair? as your that better is strong end coming at year, it a

impact coal it is we on thing I and utilization as that a type there very cars at one expected. lease, off variable on low such the lease biggest almost most before have out utilization would talked coal exactly they're cars lease about what is are is we has for or little performance. point Yes, whether rate on The car

All right. it. Got

that you on to the business comments ahead is be, tracking portfolio Moving separate thought any it the what's strong of a question, management would drive performance? where quarter, helping good sort had of on pretty

in Rolls things what offsetting-- materially While going some good not are to extremely expected. management extent Royce little they very continue of we half is two beyond perform portfolio had and the a there to on year first bit well,

maybe that how the we'll overall, volume good the half see little plan out investment of year. second a So for bit good performance plays ahead and of

non-core investment in portfolio performance run there know we the ocean-going to have that five of also another those of there us, vessels you they're that comprised but actually the and is are As behind.

so the those vessels challenges And to and charter vessels challenged. the terms of LPG environment. in environment, very rate and globally has we've be rate seen charter rates the there They continue been are in service primarily with depressed more

we that's into coming what had the running actually behind expected year. So

and is sharing of not those portfolio opening residual offsetting. repeatable. fee in performance which So big first last pretty Jen in this the about had kind again really year two managed difference the after The are in a year our quarter between verse we sizable second the was that million, mentioned XXXX $X.X her

on that the year-to-date versus So XXXX. an impact quarter-to-quarter performance had and

is safe just sort maintenance then And helpful. earlier versus year expense it of X% includes an assume in your more to a new flattish guidance rail that or that's on I the of Okay, -- a the a clarification in to question, expense, mean maintenance X%

just would up. say to I marginally Yes. flat

in finally, big in And context just That's fleet the be us big that Or the quoted India? earlier? helpful. India could the you volume remind of investment is the will Okay. metric then it investment, you how how

is the with is investment, a doubling Sure, gross the there quarter Justin. customers. now orders $XX about clear the million but are second the the and fleet probably over that next that fleet to size end just to path year represents that cars Right committed X,XXX of existing of around at of

They're that their diversifying The see utilized. within next finally can from one away you going So fleet's just the container great. XXX% it's double fleet cars. year. And

over So very it's going there. well

comes question the Walthausen Co. next Our with Hinman from & DeForest

for A different ones. thanks taking Hi, questions. the couple

could blip? this that is picture, know, months? XX a a the X some types scrapping car right or potentially event the feasible over combined just on clearing a bit, talked but You I be next, meaningful older prices little the big are with this for now elevated Is tariffs to steel, scrap about don't

Yes.

get competitors of that the the your in So its what at look car could life earn higher over you expectation scrap prices at to a car we is help. versus rest certainly shop, scrapped look comes what our is what it. if what when you What happens

makes prices So obviously you it encourages, likely scrap that scrap more that up the car.

going predicting in. as expectations price pricing what It's when the going real-time anyways. the based wouldn't alter we on our far and scrap do As extraordinarily to decision a that's forward, comes behavior is future difficult car scrap

willing there, are about willing be speaking, units owners doing? other you what more speak yards Is to generally you people generally? to Would seeing are to more Are go scrap scrap?

something It's as what track not that are scrapping. we far as people doing other

industry think be the year. or but we'll up plays year, are industry or this I to up how --there data some forecasts full that out scrap have indicate will see scrap rates will be that activity

Okay. And been disclosures then that affiliate you've helpful. in some on Q Rolls-Royce income, the the have added

You we sale that Qs. disclosing dispositions of in second quarter kind or dispositions event? have we the XX.X in baseline a reported been is the engine that no the with have Did

that Now of that in remarketing $X about was million number.

Okay, great.

baseline in So don't the, doing $XX the range, of I XXX don't engine million of mean income that know, if we forward engine from we is count with business? I current that a dispositions are assume expectation and modeling kind of

change our $XX I we the to any see between pretax $XX last probably for into and of $XX and full would don't XXXX. $XX for the $XX about came now. roughly million year, Year-to-date is that We right XXXX, said million In we -- year all be year. million is million was

-- the there's then disclosures K the And Q again, talked maintenance back that in those some those weighted more you other of experiencing the or the I recertification already about have Are some back-half recerts. reported? in people terms think of in first tank or Okay. about some costs it. maintenance half reflected those the to asked numbers the year in we've been But of

available customers the this an than requirement the They we there's expected slowly are annual requirement. to the works this next but it's in have that have year. course way of we over to many just car like the the entered come So year, many a the not quarter, when us it's make this more quarter,

to be a back than thought. requirement the half year, --them rate the given get this we done to expect at come to in So we them higher originally

area. Okay, oceangoing that's helpful. touched you the on LPG And briefly vessels,

that with think Or thoughts weak time. do market those that and those for wait vessels? to to sell? the us period that we Can something some give pretty of those Do what trying improve? we you longer-term I onto has for are hold actively we been are on

Well, to I as GATX. not core said they're

our vessels we're longer-term my aren't a vessels. for on that and So operating those keep They is looking deployed. them currently regards options view all is pool to at opportunity to within those best with

Okay. last question. And then

guys with You active fairly the few over last been have years. stock buyback the

blackout think quarter; transactions you stock. back give put a understanding quarter? in bought press disclose you were first looking some if didn't release, you is why at I you And us this the you occurred? the better sizable in the Can of for that that whole any

about railcar X,XXX the quarter; we Sure, the we with that of materiality yes, manufacturers And on the between order a already we and not significant during between the supply completion probability potential that market. --to an did we XXXX filed we've in did you the XXXX. the Subsequently, were cars for during and delivered of in discussion not we repurchase any railcar stock be place extension the contract, talked X-K second given previously and and were know, as or call contract. quarter about that

So active half of the that's and completed be would we during repurchase under the year. to the expect second

Thank you.

with & O'Hara question Our comes Sidoti from Company. next Steve

Can me? Okay. you hear Yes.

little out here can Or you that in point is bit. kind in Just direction? bailing is not And little maybe being I I a moving a guess with we of on shifting but like it of right think to we anything are is yet, things I many industry I paraphrasing bit. the talk the fleet, maybe too talked doing think out past, the in -- in too kind bailed oil many there cars about order, I'm the you have are that? the mean that's the cars maybe about past and --

Yes.

the So vast though to rates below. I the is that you still negative. moving think majority we're at but right we're your our LPI still car of if last sense the types, look again in And well compared for long-term is direction, a improving these good averages lease one

So still improvement. a low XX the But mean I they're talked have at we -- versus about absolutely seen levels cars. quarter We ago historical XX% basis. a for quarter-over on

As what's the it far fact be railroad a low. what couple that is out out, we've relatively the talked helping times performance is might still helping as about

solution cars So truck is not to that the And more is a it. available. throw alternative to of readily problem to going at

that the certainly So helping is industry.

improvement uptick loadings You seen but with why we've that's combine to still go. in ways the that again a

something if are rates just maybe is in asset on still fleets think on time like things like things Or overall, long do that, well purchases more were guess economic cycle be the it the and it's as below And just -- time of pressure quickly? to or in it then the cycle, not I I'm kind tooth? or still the under recovering average maybe dip at aggressive not to as is right the as you that? And is more or rates. Okay. looking aggressive be you

that. can I take Brian. It's Yes.

good placing the a in far at one as more an mean, second bigger acquisitions increasing, and are looking placing we order, look recovers, order prices possibility look look you It's price attractive probably opposite increase, expensive. something when year something right railcar, less you And look tariffs in stays for are don't less at the it steel but we focus asset the this get things increasing as and we're are the -- As the - and always term side, going acquisition, short been what doesn't market thing getting side, that's general. the as on far new the acquisition already. as always more of growth have continue It results on to you but at. The we look of said and doing at asset whole terms, at quarter. prices is on oriented at saw become to a the things but

it see in scrap. You

see You demand higher at in ASC.

quote up; time. are metals car loadings those builds some it's that for driving new car Steel investment car any are but going of higher certain going to of manufacturers seen length right. You've for in fixed up types, because and are prices bad new prices are refusing railcar for prices strength

operating for So usual happens --as bad results. it's for the investment, good this near-term

And I with within a your sense you. obviously, some just and there you guess, in there if I And itself you said capacity back mean, improve, to? maybe capacity Thank helping. mean, the to ASC, competitors? Okay. terms in within you is continues -- industry for you wanted charter is enough better demand do demand -- amongst out I there? can the utilization tariffs, then mean, And have of if is I

scheduled and tell you talked year mean is it's vessels beginning Yes. good are I the which demand. increased of fleet will our those XX XX I about challenges the through question. the now vessels deployed; weather fully at a year. the We

those industry fully in for So in think are general utilized the the fully utilized the I year fleets and year. are the for

pellet ore have seaway. if had through vessel. for that for been although they To extent So tonnage, happened of as it the what's upside create prices come far years to largely as through they'll higher will figure ASC; the ASC iron volume want it two new steel that's spot export out out to demand demand, spot another bring over the through last

And be bigger It small a spot to new to so it's request has out for expensive a tonnage. bring vessel. a one it be obviously because can't

the when contract, the upside but more year you and gone existing they tonnage lower efficiently, a upside contract. a for would seen So, into have you've I as they have that up price yes, more freedom coming to carry our for the there's we customers --you the outside just price spot tonnage and is already asked little said, within at which the higher at can forecast ASC has real think volume ask

certainly see have develops, possibility. year but it's the how a to we'll So

with Our comes a Seaport Willard next Milby Global. from question

morning, questions Good everybody. so have quick Most of my just follow-ups. been answered, two

to On with we a call Does the the year, of the of beginning are likely your, norm I about repurchases Or repurchases, in XXXX. a see mean you past, and $XXX share were stick year targeting more still at quarter million think could guess, I for it, all been the million catch-up? that's you the some $XX half? all that

million Yes. into end we're in --as and $XXX We're right it year. outlook, that still of We that our range. the at we're looking layering looking would now out through the

the that expense? and step the right. that All all the a what year. I growth also that year-over-year case of And looking at Is after quarters to percent down still expected SG&A think full you of on drives expense, maybe two two your or kind

Yes, well, if SG&A. you look call at it we're at where we are at year-to-date, million on $XX year-to-date

exactly annualize with we where we If that you be XXXX. were flat would in

of little goal. big as a half be. the significant everything T&E bit in are compensation, the on We'll to with try standard number that the from off of down where a So lays salaries we're weather there. year we thought year. No tighten that else would drivers the still second in mark items And all the not our anybody, that obviously our at

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taking follow-up. for Thanks the

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Our Bergner from next & Justin question come with Gabelli will Company.

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this queue questions you. the Thank are All in no at time. further right. currently There

morning. for you. questions. Please everyone to the participation I'd thank Thank contact their call like with on follow-up me any this

may now and This you teleconference. ladies you, And disconnect. Thank concludes gentlemen. today's