David Yeager Chairman & CEO
Phillip Yeager President & COO
Geoffrey DeMartino EVP, CFO & Treasurer
Justin Long Stephens Inc.
Scott Group Wolfe Research
Todd Fowler KeyBanc Capital Markets
Elliot Alper Cowen and Company
Bascome Majors Susquehanna Financial Group
Thomas Wadewitz UBS
Jonathan Chappell Evercore ISI
Brian Ossenbeck JPMorgan Chase & Co.
David Zazula Barclays Bank
Call transcript
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Hello, and welcome to the Hub Group First Quarter 2021 Earnings Conference Call. Dave Yeager, Hub's CEO; and Phil Yeager Hub's President and Chief Operating Officer; and Geoff DeMartino, Hub's CFO, are joining me on the call. [Operator Instructions]. Any forward-looking statements made during the course of the call or contained in the release represent the company's best good faith judgment as to what may happen in the future. Statements are forward-looking to be identified by the use of words such as belief, expect, anticipate and project and variations of these words. statements cautionary the review and relief. Please

those you form XXK addition, could actual materially should forward-looking regarding refer company's the cause from differ to in closures results in and that these statements. to factors In protected other filings SEC

reminder, being recorded. this pleasure now It your to is call the turn over conference host, a is my As to Dave Yeager.

begin. now may You

David Yeager

Chief call. and Operating I'm Hub's Officer. in my quarter XXth in Hub flower afternoon office company Group's Hub's DeMartino, participating President and a anniversary the thank Yeager, Officer over for a and today in Geoff Chief joined On shop Illinois. earnings Hubbard you by April of Phil Good celebrated one-room starting first Financial parents XXth, the Hinsdale,

work would to go their future people of ensure My Hub contribution for and of thousands decades, each to the to them grew thanks success. every prospered. and one for Hub that position Over

continued inventories. customers strong quarter demand first exhibit our as to The replenishing aggressively are

positive will retail sales Going remains to growth strong X%, we The continue of imports. favorable historically with conditions low outlook strengthen customers. our expect sales and inventory macro forward benefit GDP to economic and that

With by Phil costs. transportation business a to pricing positive our increased will shortage truck I'll call to driver supply for creates drivers, the partially supply capacity strong outlook to We believe truckload of changes. production, of lines. demand regulatory with a the capacity offset of review tight constrained combination On and issues environment rising that the insurance due and continues turn side, be to be over that, expenses the that the

Phillip Yeager

entire I'd CEO, our on years to our also the service, on to innovation and Group Hub Congratulations XX for to integrity. succeed XX team up focus his Yeager, will XXth chairman release. more. continue of like congratulate earnings to his XX and Dave success successful Dave. has steady-handed and on leadership and drive for enabled to our and set as His us determination be CEO us for year XXXth Thanks, years

our For of the significant a quarter, in benefits We market, dynamic continue weather improvement of the strong pricing. moved our with In intermodal been to delivering the realize and ahead. enhanced disruption particular, opportunities model through strength segment has past prove results

weather intermodal volume. most dislocation X% up volume year in year over gross year the which with declined XX% year over our year, quarter. repositioning up of impacted disruption costs as and sales X%, impact their The quarter, the and and and declined of million of trucking revenue increased a higher was the east Gross Transcon as be could a fleet segment west turns with as For offset the slower volumes was by of was not points inefficiencies leading surcharges increased the margin percentage weather disruption our X% to impact X% volume along increase impacted created with year. productivity and intermodal pricing basis outsourcing network local network enhanced margin drayage, of local XX% a $X fleet. XXX over and

demand and robust the with improving end continually see the environment. through year, ahead, As crank we the we look of along

onboarding last points increases by was with increasing business weather meet fleet as new X,XXX We outsource of with stack. year. XXX quarter executed our revenue our mix, service for the offset top our increasing improvement year our containers losses additional on logistics continue tracking percentage costs. by year. and margin adding our in X,XXX year allow cost demand announced basis a a of to investments along segment, X% will sales and negated work, and with us which gross an from XXX of reduce our strong and gross customer improvements containers business over purchase We margin had in previously in This Cape invest which our in fleet Logistics on along strong of last to

several internal has we benefits successful this that an the addressing integration. are improvement will been We initiatives remainder through extremely the of see from year. NFC throughout

our from organic Hub wins service. synergies We on while and existing our great are from by onboarding cost growth our executing new continuing leveraging clients customers

strong well XXX logistics a on margin performed as our point have forward. and a strong revenue decline and basis growth with volume, in service, We of very value to we Brokerage a costs decline pipeline improve in help well, as across proposition with the XX% reduce as going gross percentage sale. anticipate X% demands

to volumes the and grew our move XX% continue our strong market our contractual, spot in during as support We quarter. enhanced spot wins proposition. team's value our XX% mix the We to clients LPL our through

great in made dedicated We strides business. our have

and and I We discuss us growth products and allow we resulted it strategy, over our operational a are we revenue sale. returns which point discipline gross our performance. processes, will in line, The our turn management have enhanced the XX systems improved ensure financial a basis to much Geoff cost make will enhance margin compression With structure, of our service improve to and enhancements our level. go-to-market percentage XX% in continue to to further that, to at in team which service continue now to as

Geoffrey DeMartino

Phil. you, Thank

during QX up which despite company million grew or our $XXX Gross QX lines of service revenue impact Revenue over our of all an with XX%. XXXX challenging is pleased our was rate quarter. margin in are XX.X%. improvement performance, the the of XX.X% total with We weather revenue,

over primarily were and exhibit due the and the XXXX. incentive to expense continue count. head revenue with increased quarter flat partially year. in costs strong compared salaries by for last NSD offset year, expense, acquisition equal as to compensation control to and We despite benefits Salaries of December to XX.X% of quarterly lower X.X% of year cost expenses lower Cost expenses

XXXX. to Off by efficiency per prior share travel administrative quarter primarily acquisition X%, compared higher NSD on lower QX fees, our for technology in due sale. the of diluted as was over the EPS excluding to Our earnings quarter the by of $X.XX $X to million lower This professional compares non-driver to head expenses initiatives. of general the gains is $X.XX. Grid impact expense count due and down and first year the and declined diluted

Our cash quarter million of XX.X%. $XXX tax rate hand. and million quarter on of We generated ended $XX with in EBITDA was for the the

continue priority have expenditures business solid acquisitions. levels capital We in debt. as We the view to liquidity to and asset structure low our capital reinvest strategic through of and our and net an is

XXXX EPS to in We that to $X.XX, $X.XX up to are announced $X.XX our raising we $X.XX from expectation February.

the all lines. margin We revenue range the XX.X For XX% consumer and to that percent levels as XXXX, bid customer of based realize revenue the forecast year our percentage rate mid-teens demand with to revenue single for growth the on of outlook assumption volumes of low a positive that continue we business gross is throughout across progressed our will in inventory high grow intermodal year, as digits will increases. and restock. expect increasing of will the through benefit economic the for need season we drive and conditions

we to and year, the For expect XXX cost expenses $XXX of million.

with the to and anticipate more to compensation continue book cost $XX expenses million will QX, For profitability. range in from as variable growth year we line throughout expense will increase XX overall in we

the XX year. be tax to our full for XX% rate to expect We

fleet. order forecast which X,XXX net We've adding refrigerated our back will also XXXX drayage growth containers. replacement XXXX to our for majority for Our older the XXXX adding The of we'll in which to $XXX remainder Dave, approximately XXX after support growth containers expenditure ordered dedicated capital We'll and million million. in result $XXX and is units trackers. be We be of are for container XXX and remarks. you closing of retirements. will increased

David Yeager

Thank you, Geoff.

Our the lines. our is demand optimistic for in remainder very all remains outlook of of XXXX business strong

continue high service. levels need open we'll the offer that cost-efficient As solutions of to With call to our that, any questions. up customers


Long Instructions]. [Operator question from Justin comes our Stephens. first from And

Justin Long

volume the and EPS into what's a question on and from to and have get from do around PPS an million -- intermodal I headwind out whether guide XQ? but pointed headwind well, baked to the thoughts wanted you as Geoff the then margin weather second the in, start estimate in any of quarter X you you the costs would Phil, for perspective. all love mentioned with or And either

Phillip Yeager

question. It's Sure. A great good a thing.

because benefits highlighted our intermodal well. Western Cape to in in as was. brokerage where impacted think in truck first had business were intermodal spot where the offsetting that freight that obviously we well because shut the and side to did had. That network impact. the market. it it an highlight some most really able needed I was we stack was see challenges That support wanted I biggest the down delayed Obviously, the some maintain portion had intermodal or network that really we unit in as think X some certainly Eastern I in in the headwinds but largest some We days of challenge benefit. of the was that's

If you for intermodal in X at January We've not X% that X% days, we look trend up improve adjusting in then volume business up in XX% to weather were February that's in And I and you March. in wanted improvement highlighted and in sure down to Geoff, sequential with April that. make if the growth. around there, impact. hit which from the want numbers at on came volume just I seen

Geoffrey DeMartino


that mid-Xs it. it’s You've there, to pieces low of the you talked after Most about. the got that capture Justin, kind Phil pieces of of kind net probably

Justin Long

quarter, second any Geoff, could the color of you there? terms In give

Geoffrey DeMartino


faced over have adjusted sequential a We March volume day now year, the expect just -- comp relative year last a Phil we'll business year, April over we sequentially, easy mentioned in growth have pretty of X% April XX% motive over from a actually basis. growth up QX. to on but even

have as continue obviously, our now second on to or will of XX volume the about of benefit repriced, of profile. XX% to in get some be we'll more to come. based to, But those well. we demand and group-priced quarter, price And increases, starting another we're expect we the starting the intermodal XX% grow, volume, So

Justin Long

Okay. That's helpful.

that Second on it there for volumes question growing growth. change charge case, The be And on better it commentary cost how be more that say is the bigger does the just intermodal fair framework to if UP relationship is that an to margins? relates more in inflection emphasis you've and clearly as that their an had front. visibility? Day, and longer-term both that point leading would and intermodal PUBS, Investor your together of suggest Would seen to that providing seemed was picture.

David Yeager

is Geoff leave We're don't and with Phil. relationship part to last Hi, stronger. of been the Dave, I there's or very Pacific, working The ever collaboratively. the Union Justin. better it I'll This and believe

on investing encouraging are certainly in doing us And very and environment focused very, growth, so us it's whereby and that. our strong collaborative they we supporting product, a in really and are intermodal

and partners, for rail been never will be think both a I better we've the So in our able major position grow a in us as to continue driver act that with to this of future. really to

Phillip Yeager

I customers think investments lanes excited work particular, been this our the other just at Minneapolis. about but bring Colton, infrastructure to would are able strategically as think that growth that framework I seeing up distribution also set in really And that, visibility our new relationship. our growth, a and we operations those center. items, We in us, as for to Phil. in better great contractual where current we we Colton, in Southern cost, so have constructive their well Yes. or a us, clients. improve helps having and add, where domiciling California, is avenues with both That's in being love great can our with together. are for is this just of really to to point on phenomenal more drive We're

So really, a great there. growth opportunity for

a I soon. delays I have in you ahead truck of tight capacity, don't intermodal, think going look you delivery anywhere we driver trucks. As that's think have shortage, in anytime

a corporations You intermodal we great do a that emissions, And, with their carbon think on that. larger carbon have escalating fuel focus also think, great footprint, and is I and with lowering prices. to backdrop way

we're why to of generating factors for prolonged qualitative kind strong make a we're intermodal, to part invest return, and is So quantitative growth so and all pointing sure are towards going the big and that in as it well. a continue of of


Our question from Group from comes Scott Wolfe following Research.

Scott Group

I margins. want to start on gross

the there, getting given keeps the unchanged. beat by guidance, you just basis XX environment but thought guidance pricing So your left the year think about quarter, points, full especially better? What's I the first

Geoffrey DeMartino

guide Yes, QX. for we specifically didn't

XXX. think QX said up from I of we'd our rate we be adjusted

track. even on we're can get think up XX, we to that pricing I XX, So We upper to more as takes think of the hold.

and seeing very that are repriced. our pricing We its business work volume is into strong and way revenue has dynamics as to

continue to to expect stay on So that we year. the path throughout

Scott Group

year in we pricing, If nearly look started realistic at that to over is to you XX, year, on the almost the good it year If the XX. ended closer time now gross maybe really starting Yes. the perhaps, an year, 'XX, the we're XX%, I XX, margin? back, in last XX had end

Geoffrey DeMartino

I'm not that quite sure we far. would go

pricing strong but to be a high conditions stay the quite are, think year, with current going end think, that up I'm this environment we and I we're sure that year, way certainly next possible into year. not would for this they if

Phillip Yeager

I think set plan in getting also good it very about lot up We're a feeling the of for plans right on peak. now, place. depends getting peak

that to upside, versus our So that really think, some certainly forecast gives I us comes fruition.

strong discussions really that potential west and peak the having, based I we're just season. from anticipating the clients hearing coast we're what on that So a and we're highlight upside, would as

Scott Group

lastly, have re-emergence be? do thoughts on the then ABX, potential Okay. could of And you impact what just and

David Yeager

Yes. do fair as, We contractors. of were Hi independent closely obviously, a watching very use Dave. this that is Scott, amount we

large that, hundred percent driver So taken, but doesn't different in have We particularly something our we're needs. out actions a a fleet do company California. making it's California, of certain a in in definitely, support are case it lot plans of

just So working something in the down that it's will through, that continue legislature, they're path the in going. fact, we're anticipation

Scott Group

cost ballpark to what impact a be, way if any? Any could

Phillip Yeager

there, be who model to is company the but taken building driver we've of broker great contact of that to markets keep competitive out a is the I our pretty think have with, very where driver to the very infrastructure, network we've or support market, where, one regardless model would to be the independent and I regulatory would very an going our also a important, I quantify. of forward, a drayage been know shifting drivers. where tough And of we've their that's out an continue whether that to a adding share own operate to infrastructure model. environment, and migrating successful, Obviously, volume, ourselves, partners, job in contractor able be think that we very in more are to more close a in say, of overall successful more we done model, drayage

to So that very navigate there because I I the our cost regulatory environment don't will is through think impact, successfully. a see base vendor continue


Capital. comes Fowler Our next Todd question from KeyBanc from

Todd Fowler

but last about expectations intermodal range, bit currently? to I speak apologize And Hey, are about thoughts quarter, book, it in the pricing? to I pricing implemented. you updated that, great. mid if you're like a contract talked I renewals high you this, realize think Do you missed to can single-digit have XX% the and where little sounds on on

Phillip Yeager

at continued the as double to price We're digits that's that continued continue. production inflection point, Yes, this highlight I improve. saw pricing, this driver the greater disruptions, to is even and after would at I shortage, the the Phil. think continued weather renewing shortage in point and well, anticipate in new with we has going chip environment an of vehicles delays that and

Todd Fowler

at Okay. opportunity follow environment at comments, the to That's the a container growth. fleet to Justin, up turning more down see I up you're you're to just a more you longer to or term, able could volume? tail but side great. single-digit the bit want growth the do how too, and environment, be about growth some where so, more this there's the year, for expectations get, volume see an think then capacity, get here ability the we even on market? this couple sustained for intermodal to just on that your add to given taking constraints, looking on this of And little volume, constraints, the modestly, where, in Is of additions that there balancing volume point, the pricing an don't and this you're about high years environment volume And a intermodal of

Phillip Yeager

have piece was well, they buying continue just year, I renewals the that the is I that think we growth market. Customers the and intermodal to they're I the seeing continuing. want of want where through capacity, next with will to lock year. to think And the stock are Yes, into another in that don't conversion so in referencing, remainder as

at the transit, out than delays we unloading and and but that in of turn that a opportunities, think longer lot volume recovery quarter. dray a was destination, enough I took would missed certainly weather, liked. from to fleet I little We rail quickly. sourcing that had the slower us dig in the have of also capacity XX% A

transits is upside have in the could deliveries and there factors our can going think we positive, generate capacity that on really, our turns those all We we June is April, demand will will we are is orders seeing top create really the that well. incremental haven't May, forward, there, more half. will which done. and handle really trended now And be, as we've which alone capacity and back place, in even in think demand but will But create tighten think this, the certainly, us incremental I taking benefit that today. we're So than to from we as earlier be modeled that up, capacity, great, in of there with,

bullish So, dig ability very, to more. on very our

Todd Fowler


the Okay. That year. milestone makes That sounds And additions, sense plus helping the ability container good. on this the congratulations on handle volume. to the velocity, more


comes question Alper from from next Elliot Our Cowen.

Elliot Alper

any stay congestion year, the I about think you into perspective, rails color other margin a intermodal, guess. into and may How X on in right quarter lot are about then, talked Great. what now? the be growth, should a volume guidance? wanted second on we telling to about I And intermodal the baked

Geoffrey DeMartino

we saw, expect speak more repriced. Geoff. margin increase margin gets like can is we and again, improvement. continued in of of as our intermodal, expansion into of it'll the I QX, QX the in particular, to the Much throughout year, This Sure. business more

is lever very to big gross price us, a our For percentage. margin

QX have pricing well, So drivers for that the year. maybe going of I of QX, year. improvement play see of increase to of the anticipate the course one the our come margin in That the course but key particularly year, up term, but we short from we'll the in intermodal some do the we'll to think throughout year. that slight the strong as into We in the was throughout guidance pretty ramp continue was rest the throughout expansion costs

Phillip Yeager

would discussions, Yes. around and in I seeing from in And the add seeing just improvement it certain, our are rail we're numbers, we're fluidity. we

pull think and of in down, in making that the that perspective, that's part we're that chassis our of with I clients past making is have part events, then a to help times, and available the unloading improvement sure to getting some also there. the from working is And freight. congestion weather capacity we availability seeing sure

are of be all heading So a those really, heading we position. and into factors positive in peak much anticipate direction, a better in to season,

seeing are improvement. sequential the we so And

Elliot Alper

then autonomy Day leveraging Okay. the some And the in they investing at in in secondly, drayage operations, the if Investor That's future. about yesterday, helpful. you'd that's something talked UNP future. Curious consider

Phillip Yeager

Sure. Yes.

going different continue we're technologies. to with think I experiment to

it. vehicle place excited launched was we So to I just an in actually really pilot. electric take

exciting be there. short-haul I need think have. in overcome, that's the step configurations There's some us weight that to challenges step and really we that cost infrastructure a but great for

applied, closed nor that something anytime confined well. haul. autonomous think I at don't that to we're a soon, very area, or think in and in be looking going of see technology much short sort can as that's very trucking I long-haul you're in the

much be there to opportunity continuing those you'll in In I a utilize technology. for with of which terminals, a think and And I continue a research for opportunities everyone. big have other UP, autonomous and confined think truck, an that's to to driver win look would we're, I is something that deploy. have really sort to partners could safer the vehicle, think but


Majors next Susquehanna. comes from Bascome from question Our

Bascome Majors

case relative incentive to move and and revenue earlier to cost comment cushion potentially understand a guidance the guidance higher? Just of made some accruals Is leaving the those the in and work. they You sequential just in trying that to expenses income about how tends comp. in increases cadence cost

Geoffrey DeMartino

Sure. because a on bit Yes. And we quarter's call meet bonus. XXXX, not we in talked last did paid our little criteria about this

we a So performance we bonus year. more and profit start anticipating and more in throughout recognize for the pay to pay we XXXX. and are to bonus budgeting We accrue as

starting profit we're that bonus to anticipate for of to off build supportive margin as low, continuing that contribution So the year and the up is gross the year. us a level our would operating we allow throughout other pay and

Bascome Majors

rate, you exiting in for into the to mean, long-term I kind assuming quarter target, way there X% be back exit stay on that an a early to seasonally fourth run or is either And above XQ, the your XXXX? opportunity of rate, things on

Geoffrey DeMartino

operating leveraging saw possible. do the We or done technology. really headcount through improve QX And really back XX certainly the add in a that were be think, bit a to job, and to good mid-teens based efficiencies continue additional you swing and growing think with expenses in and to the at revenue we I operating so take it's we next we place on last months strong anticipate year at year. expenses of could numbers, We've the incur it structure we'll we that out pricing a X% and some some leverage be take able could little year, expenses to at cost And I And in how that. think those end the costs to the expect those range, so grow, is we'll exiting the be of or as costs. growth, we rate don't certainly our but

Phillip Yeager

up a was we've swing. right? those benefit the market Obviously, pricing happen what maintained but bid where at also base from last off and back the with And coming the the concerns certainly time really into pandemic, lower commitment. an got coming to of with improvement I line around this environment, large we're a that a lot rates mentioned a renewals is bring might've the of are So the year percentage in. going We've seen that to opportunity in customers

the surcharges some potentially as will think but upside will quarters that be have market renewals swing really rate be of run think we first a of I well to capacity. make again, on factor is and pricing year is, provide that about the peaks Obviously and give we'll these the that us be capacity first that us we the the now sure are or the I in target. a other additional have to that on will higher half available, than like once is effective X costs to out What we that give of through in through first be half coming that some that next year, 'XX. which benefit last

Bascome Majors

rail similar think a year on talk bit this about how at you're you little that'll compare to viewing on a into Can have side? one what and PT point 'XX much Last you the visibility you topic, how the inflation. this

Phillip Yeager

to similar Yes, will year. [indiscernible] year. be and it last to similar we very visibility anticipate good this have


UBS. And next from from Tom our question Wadewitz comes

Thomas Wadewitz

the you Wanted Yes. constrained important pinch present at that I and you look Rails East I is potentially and ask time? you that bit about, to constraints could how how most you much see the fluidity guess the What in alleviate a do points and as a they maybe are forward? system. think guess, West drayage the

Phillip Yeager

This Phil. Sure. is

premium, making where level, and side. working both a that well terminal as capacity done unloading that sure and sticking the were making at up, I The seen, which of the that through constraining beginning improvement that times during We capacity nice seen our congestion was significant are transit. is why have on we was proactively we've have think given we're of which some rail at out the think, transits the the in and of drain job, a I were We've as they were with there. an rail obviously, and of surges the storms at online them, year, understanding part partners with sure elongated

driver maintaining driver job we've a competitive our very of On the good a street, force. in done market

We to haven't have our capacity. we've have There of on as but work, opinion, And to good move a align job, side, XX/X of with would a added I drayage and a my we that constraints sort weekend I seen done and some think, we as available done, night many carriers think there. continuing are more in like, that's I ensuring job on where we've great right? constraints as we third-party the very year, has But, chain. a our once And has then challenge. constraint capacity, were was availability, that our supply overcome warehousing. And getting and really this online certainly on terminal for drivers year, folks into fluidity been that. working third-party to early work last constraint something with with struggling customers, impacts a on really that fluidity That downstream our certainly been and again, well. a chassis which as partners lastly, and

back more significant improvement a broadly, in to work. As have we've coming folks out rolled been the seen vaccines

necessarily all I not consumer, continued is and thing think out is good time. the for there, industries, challenge government subsidies where for work still the that incentivize long-term. It's might the this unloading a Something our not is for that but

And So once from the first significant we, our day. have seen in improvements and every closely were again, is that we're something monitoring of the we where quarter clients quarter with even this that year. fourth

those of us. would there all I are So say don't I the negative out in right a see heading direction. for

and think strong a in shape to down make I that have very want continue sure we'll be peak. we Just path, to good that

Thomas Wadewitz

East West, of something Is What performance spread terms didn't Transcon east was likely I persist like is them was Great. year? the I that west number numbers -- offered, lot big you a the through and that in the think think but for down and up. catch would a think about you or all I normalize volume to volume in intermodal

Phillip Yeager

saw Really, off did even West that. and do bid with demand then our significant it win lot wins. was a We the to Coast beyond

had that see Coast, continue pushed growth on made the are and progresses, of the a year West it we normalization given more rates to commitments capacity that. those So we but more should as to the seeing

empty out repositioning east, big can a us, that. local we create in in try balance more have the focus costs, For more And of we growth through the to and is sure take network. making

Now, soon, markets, XXXX, we or really forward. us on loaded Coast into I more available and least in don't but and costs capacity the see the inbound at in have which stopping benefit demand creating any successful going West through time bid those will season been

Thomas Wadewitz

you just So east? are think eats repositioning of that's would function or containers the out volumes up of a

Phillip Yeager

to west. would last on the have not east. so I basis be Coast, upward maybe would But comparables somewhat easier growth on volumes the at obviously east trend That our forward. say the West a mostly year but year-over-year we'll my... grow we're the that in continuing will was off going percentage

So the from anticipate, us. year, kind you as of of growth look you'll I the see eastern at would remainder


next comes Evercore Jon from question ISI. from Our Chappell

Jonathan Chappell

about we're logistics, some year approaching customer the of in and losses noted now anniversary that you in Phil, a brokerage dedicated.

that efficiently? your your the losses, in are base sit new to comments of a customer can lot capacity where offsetting of kind the do point businesses and you're in but those said resetting prepared getting where handle of customers onboarding customer that it logistics You all you X with it

Phillip Yeager

first. a would go I so maybe from there productivity highlight, I'll perspective, Yes,

brokerage year we've in our our since really And quarter. in productivity the improvement improved XX% we X% brokerage, productivity year match. of had the So implementation over first an work

largely really that making sure in changes with business. we're the that automation, pushing our first to we've really logistics, improvement, pleased and which right is is customers in workflow, the So XX% have productivity we we great, to a the made and had attributable that. In quarter,

positive. all of So has very that been

in XX% dedicated attention per the first really per year year the our revenue side, I On truck was quarter. day, which up to pay over

and get bring look to improve in bullish continue we're in very dedicated at ability the profitably on margins improvement for there our there increases a new wins. as of to the operational to continuing practices, There's So out we're demand dedicated. items, we those on and lot

opened of able pricing given feel So brokerage, higher a we've technology, doors just ensure to into in and feel... little very to could on improved with there NSD in before CaseStack on I allow into transportation coming our growing efficient even grow large our much investments a which inside then some cool more CaseStack. what segment, selective the being our going we're NSD, there And to to cross-selling going the as growth small logistics, be profitability. management, to has layers structure us margin the lastly, with outsource as starts to is it's In new well, have become, little We're we're that And though we market bit need our ones the home that And best carriers removing it. delivery have working there. management that lastly, where, to meet better bit. our we are to gotten transportation on some criteria. continue proactively, operating going wins making our off bidding how the our bringing that return But sales wins, customers, as to across It's be then we're into but been pipeline bigger our and force, that seen to before. And more sustain margin continually focus on in I up great. the of are a clients actually I've to we've Hub but the in not is we're were by team outsource and also revenue, competitive.

on And us beat so on bringing is which new growth. that's allowing to wins, the forecast

all like now. very a upside, and great we're and stable feel in non-intermodal segments the I have a right position strong So

Jonathan Chappell

well-timed another tightness lot things how And some record curious but ask to just I the question. addressed now, balance It's chain, full, you cross-selling across I would of with the much a was are and also making a guys cash have bit looking supply I'm of but to at pretty acquisitions. it, maybe continues track the since and the NSD, going right the pipeline's entire obviously, me And noticeable ask I'm you about let stretched. you're And a increase. sure valuations getting sure think your

growth? spend? they're any So you're And make there in capital of to right if that normal your is just not at other you inorganic about general not any is anything, chase would valuations there Dave capital comments to addition there uses think maybe willing now you and can look about as

David Yeager

part. I answer can one the

to continue or the while of intensity to? investing buybacks, asset cash the stock that is verticals with board of qualified I every overall based intermodal do we be dividends, review most in on Geoff, the variety evaluations, a we to asset expand dedicated. would think into use do cetera. you the or Geoff efficient And more any but whether and other not do quarter our the business businesses want of we believe more did et honestly

Geoffrey DeMartino

We've the also we its on probably business doing own, under acquisitions pretty comes and with are when of to we last selective. both, We some It chasing meet well. time we're all our the something the we acquisitions diligence in do done, on opportunities been base, we're be very making the terms actually good doing both more that spend sure with X customer recent Dave sales dollar of then but but bear there's roof. criteria, with think has been find Like cultural well, do when we stringent success but can is to criteria. with. feel has The what able we've as well and a reasonable every got valuations business don't acquisition, cross-sells. very, Nonstop, to That like pretty our said, also do had given in importantly, have we've of customer our and should that business with Yes. really force that base just to the good what pleased it is Sure. we we pretty growth I amount bring a fit. existing like, pretty profile, very

there, situation. competitive we're of if chase to a highly make kind potential work type the after is and auction not can certainly that but we go So going


[Operator Instructions].

from Our Brian Ossenbeck JPMorgan. from question next comes

Brian Ossenbeck

other was regular in that's lowering can you happening line about of more separately, day and a and then still how a it's if between carbon rail west? ESG. making spread the see the the as basis Maybe you focus One Pacific the little with that's just give actually of the east part the the conversion, into in conversation, conversions. Union truck those or from can bit yesterday talk the mentioned actually on if and you footprint. investor now been it bottom working coming And themes to earlier, it color you on And the

Geoffrey DeMartino

support story, have Yes, increasingly tons. the request product type saved like to about as million their ESG for partners for much trying And over we're our question our the footprint. about look than that I and customers road. own Sure. the Last great have a more carbon metric between We're environmental goals they're On and front, example, year, that hearing XX% here. on efficient on more that to achieve spread do. rail we the of of inter-modal and respect X.X more truckload, with their rail your use

in the east, per-mile of XX% north the double-digit truckload west on versus gap. in contract. So In intermodal a Transcon, percentage kind of basis, contract low

Phillip Yeager

And certainly important something think, and And and highlight truck versus forward. dramatically so capacity good we're I be have and that pretty close renewal. understanding, can would I looking a is of gap that'll changes place on into at. we that's intermodal we is pricing, But going service will now where in the so just think are there I on right price, the market where as premium put a

Brian Ossenbeck

you for it. that it monetized tight, And versus and guess, months, way how shippers it's get It's it see and is their XX coming last pretty on starting up in feel reporting? the hard as be be some in so for new you're have seeing the, it are follow-up going? or just is capacity the to probably maybe the conversations trigger to the quantified right do credit in is it guess and like business? get now, I something actually I that Okay, Or nice but viewing considering the now got where you do is ESG, it on the support

Phillip Yeager

way would that commitments of be of the work towards on really emissions. factor, know actually certainly a the really priority. it's out that say tough to are is or easy much based varies that well. Right? I and There seriously with given the are moved we is This it the carbon conscious always So some a make factor carbon it's taking who that. that's whether decision, especially extremely making on going it environment, a goals. that Obviously, a companies lot customers And escalated, it's cost much a making to it I headway larger as lot factor. deciding be say once emissions to decision is capacity are those again, but if a is customers. I don't to cost a higher think it's certainly by although that I with think

it are outselling we aggressively. So very

in group getting that reporting their has automated goal. can We that establishing transportation they in understand into company and for and help their so ensuring week every the been, factor that achieve are doing they to great I logistics it part customers the of scorecard, they're think, which value our out a win their


Our David from next Zazula Barclays. comes question from

David Zazula

to of want drayage as strategy, up drayage try Maybe cycle? a increased how you've on drayage picture for ability big next coming kind for cycle drayage and demand, to kind the intermodal just systems your question at to split you ways systems, a Dave, Phil outsource yourself of of to better like or handle. your on or from seen a to company the thought other versus reposition it Any look be position of

Phillip Yeager

I think a yes, great Sure, question. it's

So be shifted adding network. we more XX% XX% this company traditionally really about been company, We're company, being much successful in and past in the have our at drivers. point in owner-operator, it XX% XX% own owner-operator about to drayage

equipment, proposition marketplace have new great pay great think a benefits, the out with. great to be we I with in value

the think add to though. independent right there continuing in we markets, there's contractors are a model sustainable where We

percentage us. cost for that most us, also be we for invest the in continuing So highest that, putting effective maintain to we continue the is been going working But extremely with. years towards have to for my outside solution I believe and parties service we've head. do fleet, many capital and with will with partnerships a to strong in third capacity don't work set that and

be need company our we third nimble throughout us several on is ability get For we market more fleet, going to contract driver over years, to which to to in effectively party but think grow, as allow as our to XX% more I maintain the to the or take that we next margins changes, cycles. want

target our don't footprint. have We be to really to allow a own to So want but my do grow us in mind that would to continue view. invest

David Zazula

market to And a be just Great. to the or of spot a brokerage kind capture with that try being quick the market? little more contract take looking then as to aggressive current mentioned XX-XX it the hot is, you to split. the up as you try market follow-up, Are as percentage into

Phillip Yeager

that. and even north we so Yes, sometimes XX% contracts, run of between XX somewhere traditionally

So the a us. Part of is some little changes it we've for seen. of this abnormal is

lower volumes long-term have project lower freight, fall We project, as some well as logistics bucket. some our which contractual into

our RFPs customers of a are outside longterm, do spot lot annual going be and So the that. to of opportunities

So longterm, as I split. see the don't this

in aberration that move step exposure, think year closer that contractual I this support back market it'll But our longer-term on to going but of we're a to to clients. stock certainly has XX% think in nature. sort to been I XX an to continue our


Mr. Yeager to closing remarks. like questions. We for hand have call I'd Dave the further to no over

David Yeager

you us earnings call for joining thank again, Well, today. on Great. the

always, have Geoff for questions available will additional any Phil, again. and I some you be comments. Thank if you As


participating. Thank for you This concludes you, Thank ladies and gentlemen. today's conference.

disconnect. now may You