February 2020 Investor Presentation Fourth Quarter 2019
Disclaimer and Forward-Looking Statements Special Note Regarding Forward-Looking Statements This presentation, and certain information that management may discuss in connection with this presentation, contains forward- looking statements, within the meaning of the United States Private Securities Litigation Reform Act of 1995, which are intended to come within the safe harbor protection provided by such Act. These forward-looking statements reflect our current expectations, beliefs, plans, or forecasts with respect to, among other things, future events and financial performance and trends in our business and industry. Forward-looking statements are often characterized by words or phrases such as “may,” “will,” “could,” “should,” “would,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “target,” “prospects,” “potential” and “forecast,” and other words, terms, and phrases of similar meaning. Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks, and uncertainties. Readers are cautioned that a forward-looking statement is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking statement. Risks and uncertainties that could cause our actual results to differ materially from those contained in the forward-looking statements include, among others, those discussed in the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission (SEC) as well as in other sections of the Form 10-K and in our subsequently filed Quarterly Reports on Form 10-Q and other filings with the SEC. Non-GAAP Financial Measures Reconciliation This presentation, and certain information that management may discuss in connection with this presentation, references certain non-GAAP financial measures, including revenues (excluding fuel surcharge), adjusted income from operations, adjusted net income, adjusted diluted earnings per share (EPS), adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), and Free Cash Flow. Reconciliations of the non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are in an appendix to this presentation. Management believes the use of these non-GAAP measures assists investors in understanding our business. The non-GAAP information provided is used by our management and may not be comparable to similar measures disclosed by other companies. The non-GAAP measures used herein have limitations as analytical tools, and you should not consider them in isolation, or as substitutes, for analysis of our results as reported under GAAP. 2
Leading North American Transportation Services Company Iconic Orange Brand ▪ Three Segments, all at scale – Truckload , Intermodal A nearly $5.0 billion Company founded in 1935 in Green Bay, WI and Logistics ― Provides resiliency across market cycles ▪ Brand reputation of operational excellence built on ― Positioned for sustainable growth service, trust, and reliability ― Utilize transformative Quest technology 4% ▪ Industry-leading safety, culture and performance 19% Truckload : ― For-hire and Dedicated configurations 56% 69% ▪ Comprehensive presence throughout North 20% ― One of the largest carriers in North America America Intermodal : ▪ Broad Portfolio of businesses with different asset ― Owned container/chassis w/Company dray intensities ― One of the largest providers in North America ▪ Only known industry peer of size to have Logistics : completed a comprehensive IT platform ― Freight brokerage & logistics services transformation ― Over 30,000 qualified carrier relationships ▪ Strong balance sheet, with access to capital, provides flexibility to pursue organic and acquisitive growth initiatives 3
Fourth Quarter 2019 Key Takeaways Results (dollars in $M except EPS) ✓ Truckload Revenues decreased 15% YoY. Revenue REVENUE REVENUE Metric 1 4Q19 4Q18 per truck per week decreased 4% compared to (xFSC) 4Q18 due excess industry capacity levels which Operating Revenues resulted in lower price. Truckload operating ratio $1,156 $1,322 excluding all FTFM impacts was 89.1% in 4Q19 $916.29 $1,006.44 compared to 84.4% in 4Q18. Revenues (xFSC) $1,041 $1,185 ✓ Intermodal Revenues decreased of 3% YoY. Adj Income from Revenue per order decreased 4% compared to Operating Net Income $91 $121 Operations 4Q18 due to change in mix related seasonal project (adj.) Income (adj.) orders. Orders increased 2% YoY. Intermodal Adj Net Income $66 $87 operating ratio was 87.7% in 4Q19 compared to $22.57 85.2% in 4Q18. ✓ Logistics Revenues decreased 19% YoY. Brokerage Adj Diluted EPS $0.37 $0.49 volume increased 5%, was moderated by lower EBITDA rates and fewer premium revenue opportunities. Adj EBITDA $162 $195 Revenue also decreased due to a customer insourcing in the Company's import/export business. Free Cash Flow $172 $41 Logistics operating ratio of 96.5% in 4Q19 $0.14 $111.42 compared to 94.3% in 4Q18. Net CapEx $(6) $116 Note: 1 See Appendix for non-GAAP reconciliations 4
Diversity of Customers and End-Markets Served Supports Stability and Growth Through Business Cycles Diverse end- market footprint… …with a broadening customer base… Change in Customer Concentration 1 2019 Revenues (xFSC) 1 2 Retail 22% All Other 32% 51% 62% 11% Food & Beverage 13% 10% E-Commerce 4% 38% 28% Consumer Products Auto 4% 11% 2011 2019 Home Improvement Transportation 6% 8% #1 – #10 #11 – #20 All Others …that includes nearly 200 of the Fortune 500 Notes: 1 Based on Enterprise Revenues (excluding fuel surcharge). See Appendix for non-GAAP reconciliation “All Other” includes Apparel, Electronics, Paper, Chemical, Construction, Energy, Furniture, Medical, Metal, Plastics, and ot her miscellaneous industries 2 5
TRUCKLOAD INTERMODAL LOGISTICS STANDARD FOR HIRE DEDICATED DOOR-TO-DOOR DRY VAN Long-Haul Expedited CONTAINER ON Regional/Short-Haul FLAT CAR (COFC) BULK Long-Haul Chemical SPECIALTY Regional/Short-Haul Energy LONG-HAUL Expedited TEMPERATURE CONTROL Freeze Protection Reefer REGIONAL OTHER SPECIALTY Specialty Van Multi-Stop NORTH Flatbed Cross-Dock AMERICAN CROSS-BORDER NORTH AMERICAN CROSS-BORDER / INTERNATIONAL FREIGHT 6
Significant Size and Scale in Each Business Segment Enterprise Revenues (xFSC) 1 Truckload Revenues (xFSC) 1 $4,454 $4,281 $2,265 209 $3,997 262 $3,752 $3,588 196 $2,187 1,024 166 935 182 834 $2,091 $2,077 737 639 956 $1,977 780 1,008 758 790 2,265 2,187 2,091 2,077 1,977 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Truckload Intermodal Logistics Other 2 Intermodal Revenues (xFSC) 1 Logistics Revenues (xFSC) 1 $1,024 $1,008 $935 $956 $834 $737 $790 $780 $758 $639 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Notes: 1 Revenue excludes fuel surcharge, in millions. See Appendix for reconciliation of Enterprise Revenues (xFSC) 2 Other is net of intercompany eliminations . 7
A Consistent Track Record of Financial Performance Enterprise Revenues (xFSC) 1 Adjusted EBITDA 1 $4,281 $4,454 $675 $3,997 209 $3,752 $599 262 $3,588 $559 $561 196 $529 166 1,024 182 935 834 737 639 956 780 1,008 758 790 2,265 2,187 2,091 2,077 1,977 2015 2016 2017 2017 2018 2015 2016 2018 2019 2019 2 Truckload Intermodal Logistics Other Adjusted Income from Operations 1 Adjusted Net Income 1 $275 $384 $220 $306 $293 $293 $282 $163 $161 $158 2015 2015 2016 2016 2017 2017 2018 2018 2019 2019 Notes: 1 See Appendix for non-GAAP reconciliations, in millions 2 Other is net of intercompany eliminations 3 Based on most recent 4-year CAGR of Revenues (xFSC) 8
Appendix
Non-GAAP Reconciliation – Revenues (excluding fuel surcharge) 1 ($M) FY2015 FY2016 FY2017 FY2018 FY2019 4Q19 4Q18 Operating revenues $3,959.4 $4,045.7 $4,383.6 $4,977.0 $4,747.0 $1,156.3 $1,321.6 Less: Fuel surcharge revenues 371.2 294.0 386.3 522.8 466.0 115.8 137.0 Revenues (excluding fuel surcharge) $3,588.2 $3,751.7 $3,997.3 $4,454.2 $4,281.0 $1,040.5 $1,184.6 Note: 1 Table may not sum due to rounding 10
Recommend
More recommend
