YRC Worldwide's (YRCW) CEO James Welch on Q3 2017 Results - Earnings Call Transcript

|
About: YRC Worldwide, Inc. (YRCW)
by: SA Transcripts

YRC Worldwide, Inc. (NASDAQ:YRCW) Q3 2017 Earnings Conference Call November 2, 2017 4:30 PM ET

Executive

Tony Carreno - VP, IR

James Welch - Chief Executive Officer

Stephanie Fisher - Chief Financial Officer

Darren Hawkins - President, YRC Freight

Analyst

Brad Delco - Stephens

Amit Mehrotra - Deutsche Bank

David Ross - Stifel

Scott Group - Wolfe Research

Operator

Good afternoon, and welcome to YRC Worldwide's Third Quarter 2017 Earnings Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

I would now like to turn the conference over to Tony Carreno, Vice President of Investor Relations. Please go ahead sir.

Tony Carreno

Thanks, operator, and good afternoon, everyone. Welcome to YRC Worldwide's third quarter 2017 earnings conference call. Joining us on the call today are James Welch, Chief Executive Officer of YRC Worldwide; Stephanie Fisher, CFO of YRC Worldwide; and Darren Hawkins, President of YRC Freight.

Before we begin, I must remind you of the inherent uncertainties in any forward-looking statements in our discussion this afternoon. During this call, we may make some forward-looking statements within the meaning of Federal Securities laws. These forward-looking statements and all other statements that might be made on this call, which are not historical facts, are subject to uncertainty and a number of risks and thus actual results may differ materially. This includes statements regarding the company's expectations, assumptions of future events and intentions on strategies regarding the future. The format of this call does not allow us to fully discuss all the risk factors. For a full discussion of the risk factors that could cause the results to differ, please refer to this afternoon's earnings release and our most recent SEC filings, including our Forms 10-K and 10-Q. These items are available on our website at yrcw.com.

Additionally, please see today's release for a reconciliation of net income to adjusted EBITDA on a consolidated basis and operating income to adjusted EBITDA on a segment basis. During this call, we may refer to our non-GAAP measure of adjusted EBITDA simply as EBITDA.

In conjunction with today's earnings release, we have issued a presentation, which will be referenced during the call. The presentation was filed in an 8-K, along with the earnings release and is available on our website. The format of this afternoon's call will include an overview from James, followed by Stephanie, who will discuss our financial results. Darren will conclude the prepared comments with an update on YRC Freight followed by a question-and-answer session.

I’ll now turn the call over to James.

James Welch

Thanks, Tony, and good afternoon, everyone. With the color provided and we issued preliminary third quarter 2017 results a few weeks ago, combined with today’s earnings release, we’ll keep our prepared comments brief before taking any questions.

We have worked diligently in recent years to reinvest in the company, with a firm belief that it’s in the best interest of our customers, employees and investors. 2017 has been no exception to this strategy with the onboarding of additional revenue equipment weighted towards later in the year as we focused on successfully amending and extending the term loan that was completed in July.

We expect to take delivery of more than 1300 new tractors in fourth quarter 2017 and first quarter 2018, for a total of more than 3700 just the beginning of 2015, which is an upgrade of approximately 25% of our fleet. We expect to also take delivery of more than 2400 trailers in the fourth quarter 2017 and first quarter 2018 for a total of more than 7300 since the start of 2015.

As we look for opportunities to enhance productivity, YRC Freight is implementing a major change of operations this month. We are very excited about this large and high impact upgrade to YRC Freight’s network and you’ll hear more about this from Darren in a few minutes.

Between the current economic demand environment and the ongoing recovery efforts from the hurricanes, the economy continues to gain strength. We’re also excited about yield momentum, additional new revenue equipment, the change of operations at YRC Freight, and the investments we’re making in our operating companies P&D and Line haul Systems. We intend to stick with our strategy to improve price, freight mix and profitability.

With these comments, I’ll now turn the call over to Stephanie for a review of our financial results.

Stephanie Fisher

Thanks James and good afternoon everyone. For the third quarter of 2017, the company reported consolidated operating income of 40.1 million, compared with 38.8 million in the third quarter of 2016. The year-over-year results were favorably impacted by a 2.4% increase in revenue, primarily due to higher fuel surcharge revenue and yield, combined with an improvement in volume at the regional carriers.

These items were freshly offset by contractual wage and benefit increases, higher purchase transportation cost, and an increase in operating expenses and supplies. On an adjusted EBITDA basis, the company reported 81.4 million for the third quarter 2017, compared to 85.5 million in the same period last year.

Turning to the financial results by segment; in the third quarter of 2017, YRC Freight reported operating income of 20.3 million, which is in line with the 20.8 million reported in 2016. Adjusted EBITDA for the quarter was 42.6 million, compared to 45.3 million in the same period last year.

Moving to the regional carriers, they reported operating income of 21.5 million for the third quarter of 2017, which is also in line with the 21.9 million in the third quarter of 2016. Adjusted EBITDA for the quarter was 38.7 million, compared to 40.2 million a year ago.

Our quarterly stats are included in the earnings release in the presentation filed earlier today. So I’ll focus my comments on a few key results. At YRC Freight, the third quarter 2017 year-over-year tonnage per day was up 0.7%. This was comprised of year-over-year decreases of 0.1% in July and 1% in August, and an increase of 3.2% in September. In October, YRC Freight year-over-year tonnage per day is up approximately 1.7%.

For the third quarter of 2017, year-over-year revenue per hundredweight including fuel surcharge was up 2.4% and revenue per hundredweight excluding fuel surcharge was up 2.4%. For the third quarter of 2017, year-over-year for shipment including fuel surcharge was up 3.8% and up 2.8% when excluding fuel surcharge.

Turning to the stats for the regional segment; the third quarter 2017 year-over-year tonnage per day was up 4%. This was comprised of year-over-year increases of 5.3% in July, [2.5%] in August, and [2.5%] in September. In October, the regional segments year-over-year tonnage per day was up approximately 4.3%.

For the third quarter 2017, year-over-year revenue per hundredweight including fuel surcharge was up 1.3% and revenue per hundredweight excluding fuel surcharge was up 0.3%. For the third quarter 2017, year-over-year revenue per shipment including fuel surcharge was up 4.1% and up 2.2% when excluding fuel surcharge.

In terms of our liquidity, our cash and cash equivalent and managed accessibility under the ABL facility at September 2017 was 209.8 million. As a reminder, during the third quarter we used 35.2 million of the available cash to pay down a term loan in conjunction with the extension through 2022. Total debt has been reduced 962.4 million, which is the lowest it has been at the company since the first quarter of 2005.

Finally, regarding our credit facility covenant, through September 2017, our last 12 months adjusted EBITDA was 273.4 million and then funded debt-to-adjusted EBITDA ratio was 3.52 times compared to a maximum credit facility covenant of [3.45] times.

At this time, I’ll now turn the call over to Darren to discuss YRC Freight.

Darren Hawkins

Thanks Stephanie and good afternoon everyone. YRC Freight 3Q operating income and adjusted EBITDA were fairly consistent with last years’ result. Yield in tonnage were positive year-over-year for the second straight quarter, with Q3 2017 revenue per hundredweight excluding fuel surcharge of 2.4% versus prior year, which sequentially is a 130 basis points improvement compared to the same metric in Q2 2017.

In October, we continued to see positive yield compared to a year ago. As mentioned on previous calls, moving the yield metric can take time and we are very encouraged by the momentum we have in this area of our business. We believe this is due to specific actions we have taken as a company in addition to strong overall freight industry pricing trend.

Q3 customer negotiations to average price increases of 4% to 5%. Year-over-year tonnage per day improved 0.7% for Q3 and as you heard from Stephanie, September was the strongest month of the quarter at 3.2%, with October tonnage up 1.7% per day compared to 2016.

The change of operations that James mentioned and as we discussed on our earnings call last quarter has been approved and will be implemented the weekend of November 11. As a reminder, this network enhancement adds volume capacity to YRC Freight’s network, with nominal facility expenditures required since we are essentially increasing the utilization of (inaudible) at our existing terminals.

The network design is expected to improve productivity and reliability. Additionally, we will be implementing the use of more flexible, utility employees and adding (inaudible) turns that will reduce layovers and hotel stay and allow more of our drivers to return home within the same trip.

In closing, the yield in tonnage momentum balance we’re experiencing along with the additional capacity created and efficiencies we expect from the network enhancing change of operation continues to give me confident that YRC Freight is moving in the right direction.

I appreciate the contributions of our employees at YRC Freight, who perceiver and work safely through the adversity of the hurricanes of Q3 and stayed focused on our customer.

Thanks for your time this afternoon. We will now be happy to answer any questions that you may have.

Question-and-Answer Session

Operator

[Operator Instructions] And the first question comes from Brad Delco of Stephens.

Brad Delco

James first question, can you guys quantify at all what you think the hurricane did to freight in regional, I’m assuming it hurt freight more so than regional? But can you give us some context of what you think it cost you in terms of dollars?

James Welch

Sure. We will give it up a stab and you’re right it definitely hurt YRC Freight a lot more than it did to regions only Holland had a couple of facilities in that area. And we spent some time trying to quantify it Brad, but it’s really hard to just get it down to a specific dollar. But we certainly believe it’s in the low double digit of millions range at YRC Freight.

If you think about their length of haul of 1255 miles and having freight stacked up all over the entire country and in their network and how they had to gradually get it down to that area and the effort that it took to rehandle lot of freight or having to call over customer once it got there, haven’t used expensive purchase transportation, short terminals, lost revenue opportunities. I mean we certainly knew that we’d had a bigger impact at YRC Freight.

Brad Delco

We could see that on some of the rentals and [PT], I guess.

James Welch

Absolutely.

Brad Delco

And then of course you had roughly 1.5 less working days. The point I want to get to, the results were pretty similar to a year ago with what seemed to be some more headwind. So what do you think is on the positive side that was driving these results to be fairly similar at least in freight from a year ago with the hurricane in addition to fewer working days, because imaging some of the line haul optimization is starting to help, but anything specifically you can call out?

James Welch

Really the biggest driver of our improvement is on the yield side, and there’s really nothing that we could do operationally or from investment technology that will drive our results like yield. So with capacity tightening and other carriers pushing the yield button, it’s certainly been a good opportunity for us to do the same thing and more importantly take an opportunity to look at our freight mix on a continual basis, adjust out freight or raised prices at freight and it’s just not meeting our needs from a profit standpoint and so yield’s been really the main driver that’s allowed us to think tough and have some general improvement here and there.

Brad Delco

And then if I can ask, may be this is for Darren, the change of operation, and I think most of us understand this will add some additional capacity. I don’t know that more is focused on YRC needing additional capacity. We’re probably more focused on improved profitability. Can you put in to context what type of savings this money provides as opposed to just maybe some of the comment on the capacity that this will allow you to have?

Darren Hawkins

Certainly. From the aspect having the eight additional facilities, when you think about a shipment in our network and the path that it travels through our network, having eight additional facilities around the country rather in addition to the 23 we’ve already got, this certainly creates density and reduces miles which drives that line haul profitability in the largest segment of our expense category, the other piece is the enhanced productivity. These facilities will be more productive and have a faster time through break than our current facility. That’s where the big efficiencies come from on the call side.

The other piece is, you got to consider our accelerated service and the higher revenue per hundredweight that it carries, and these additional 7,000 shipments a day that these new facilities from a capacity standpoint provides, allowed that service to keep expanding. It’s certainly thrown greater than our expectation, and we want to make sure that our network is prepared for what comes in ’18 from that aspect.

James Welch

A little more color on that Brad, this is James. I’m very excited about the change because it’s then allowed us to take, as Darren said some freight out of them, some large and unproductive facilities for example Harrisburg, Pennsylvania will be able to go from two dock stands to one dock, at Dallas, Texas, we’ll be able to go from two dock stand to one dock. And the inefficiencies of running our two-dock operations are not good. So I think just being able to put freight in these other facilities it will have higher (inaudible) handling ratio is going to be a big benefit for YRC Freight and give us a more consistent service offering I think.

Operator

The next question will come from Amit Mehrotra of Deutsche Bank.

Amit Mehrotra

So I wanted to ask just about the sequential movement in earnings or cash flow or EBITDA rather from the third quarter to fourth quarter, at least what’s implied by the new guidance. I understand obviously the extraordinary headwinds in the third quarter, but I guess, I you would have expected to see some sequential uptick as some of those disruptions are reversed. If you could just kind of walk us through the sequential walk, I’d appreciate it.

Stephanie Fisher

Yeah Amit this is Stephani. So if we think about the fourth quarter and we think about the impact of the hurricane in October we were still trying to get equipment back in to proper positioning and making sure that the shipment were back at their rightful terminals for delivery. So we still have a little bit of overhang from the hurricanes in early October.

Additionally, if we think about where we’re at from an equipment perspective, that equipment shortage won’t automatically just disappear in the fourth quarter. So those short term rentals will hand around in to the fourth quarter especially as capacity continues to tighten. And so things will continue in to the fourth quarter as well as we’ll continue to manage through one of our regional operating companies who isn’t operating very well.

We‘ll continue to manage through that. So we still got some headwinds running in to the fourth quarter, but hopefully we can get those taken care of and behind us as we move in to 2018.

Amit Mehrotra

And can you just update us on when all the revenue equipment is actually going to be delivered. I think you mentioned end of this year and early next year, is that a January number, you’re kind of on a good position to prospectively go from there or just any thoughts from when that final delivery will happen.

Stephanie Fisher

Well we’ll continue to invest in revenue equipment as we move through 2018, but the 1300 that we mentioned on the call, a big chunk of that I think will come in December and then another big chunk in February and March. So it will kind of be spread out over the next four to five months here, and a couple of big chunk as we move through the next two quarters.

Amit Mehrotra

And then just one from me the follow-up, you guys talked about the $25 million of efficiency of cost reductions earlier this year. I think most of that was in freight, I think that was about 10 million or so of regional if I remember correctly. But as we walk from ‘17 to ’18, can you just talk about how much of that will actually be incremental because, you started implementing that this year.

And then you’ll have hopefully some reversal from the hurricane impact. Hopefully there won’t be another type event next year. But can you just talk about, as you start ’18 what kind of tailwinds on a year-over-year basis to the bottom line do you see from just those two items cycling through.

Stephanie Fisher

Amit we’ll have that 25 million of cost savings full speed for 2018. That will continue to carry on. Those were hard dollar savings that won’t find themselves back in to the income statement. The other things that we have to think about for 2018 is the wage and benefit increases, the wage increases at April 1, benefit increases for the Union, August 1. All in, both of those together is about 3% increase in wages and benefits there. So those are the big headwinds for the year.

James Welch

Amit this is James, let me jump in and give a little more color about what I’m excited about 2018. We have a volume of what we wanted and so we’re going to be working even harder on yield as we move forward here. That major change of operation at YRC Freight have a lot of high expectations for that.

Missed the equipment that you – the equipment question you asked us to [cite] and go which was the good one. We were just looking at the fewer models we’re getting on these tractors coming and versus our over freight, and that’s going to be a good positive effect on the company based on the number of miles they run. Better fuel mileage, less maintenance expense, which is something that hurt us in Q3, and certainly better safety technology, downtime, better service, better driver morale.

So the capacity has tied up there and we think there’s more opportunity for us to work on that side and growth as we want to. We can always bring on new business, but it’s going to have to be at the right price and the current environment we think certainly allows us to adjust the business a slight meeting our profitability goals and we would have some larger customers at a time, we’ve locked up some capacity right now based on what they’re seeing in the market place.

So I’ll just tell you, I think we have a very good balanced environment for yielding growth. And then finally I would tell you that we’re not too far from entering the harbors on for some of these technology investments that we’ve been making up for some time. So when you add that up and count it out couple with headwinds, we think that ’18 is going to be a good year for us.

Amit Mehrotra

Thanks to that. It certainly seem that the runway for the first time in a while has been somewhat clear for you guys, especially as you enter ’18. So I wish you the best of luck in executing on that opportunity.

Operator

The next question comes from David Ross of Stifel.

David Ross

James that was a good lookout in to 2018, but as you look back for 2017, you’re here in November now, what would you say has gone better than you expected this year, and besides from the hurricanes, what has been worse than expected this year?

James Welch

Certainly I think the yield momentum that we’ve got underway at this point is positive, I’m happy with that. Disappointed quite frankly with our productivities across all four of any companies, we just haven’t made the move there that we wanted to make, we thought we could make. Certainly not having the right mix of equipment at a time has hurt that.

Short-term [metals] has been a big drag on us that we weren’t anticipating. The maintenance has been higher than we thought and as well know our equipment is older than what we would like, but we are committed to keeping the equipment safe out on the road for the public and our drivers and that’s cost us more money than we had thought.

But the other thing that I liked about ’17 is we gained some new business that we like, and we’ve had the opportunity to adjust the business out there that we didn’t like. So there’s a lot of puts and takes that are good and bad overall. I’m not thrilled with the year, but not totally disappointed with it either.

David Ross

And when you talk about productivity not coming in line with expectations, is there any specific area whether it be dock, PND, line haul that’s more troublesome or not as easy as you would have thought.

James Welch

I’ll let Darren comment on this as well, but I think we’ve had issues and opportunities and challenges in all three of those. A lot of the three (inaudible) businesses we do is one build type pickups and that hurts our productivities a little bit, plus we continue to see a lot of pressure from some of our larger retail accounts to help them with that residential delivery and that’s not good for productivity.

And the line haul, with again some of the equipment mixes, some of the expensive use of purchase transportation has been a bit of a drag. Those are a few of my comments, but there is opportunity that we have in all three of those. Again excitement for the future based on some of the technology that we think is going to start to come alive in ’18, but Darren any thoughts on that?

Darren Hawkins

Yeah, absolutely David it is a mixed bag from what James said at YRC Freight specifically. Our pickup and delivery performance we’re proud of. In 2017 that’s going to win. When I think about the things that’s going right and things that going wrong, I think about 2017 in terms of the really big project implementation that YRC Freight has taken on, and that also is part of my encouragement around 2018.

But when you think about line haul piece that we did with [Optum], the pickup and delivery system with Quintiq, our network enhancement through [Siznet], and this large change of operation just happening in just a few days. All those together are the big steps in ’17 and also were the efficiencies in ’18 they are going to come from. But at YRC Freight specifically we’ve struggled with our dock production more than we have together.

From a carrier load average standpoint that’s a large financial metric for us internally. Those numbers are positive year-to-date, but in Q3 there was a struggle because of the equipment make, and what James means by that is when we take on rentals, you can’t rent 28 foot trailers, we have to rent 53 foot trailers and you lose that acute utilization and efficiency by running those 53 versus the (inaudible).

David Ross

That’s very interesting, I wasn’t aware about that 53 rental challenge. If you look at the [clean] count in 2016 was 14300 tractors between regional and national. How many tractors do you have today in the fleet, and what would that number look like if you were able to get rid of all the rentals and do all that with your equipment?

Darren Hawkins

It’s still on 14,000 as I would recall. We still have about 300 rentals, I can’t remember. We’ll get back to you on that, (inaudible) picking the numbers out there.

David Ross

And then last question, Stephanie on the liquidity side, it seems like the lowest number in terms of availability that we’ve seen in a while. Can you remind us of any restrictions, liquidity covenants I think they were wiped away in the last negotiations, but how you view liquidity in where you are and where you want to be?

Stephanie Fisher

Great question David, if you remember correctly in the fourth quarter of 2016 we made a $40 million debt pay-down and then in the third quarter of 2017, we made a $35 million debt pay down. So just in the last, call it nine months of the year, we’ve paid down $75 million of debt that kind of helps to bridge the gap between the 290 and 210 of liquidity.

We still feel good about the 210, and feel like we’ve been given the opportunity that we needed throughout the year either to pay down debt or to purchase or lease equipment. So as we’ve said in the past, $200 million of liquidity is our sweet spot and we’ll continue to manage around that number.

David Ross

So 200 million is where you want to be. Do you have a minimum number that you don’t want to go below?

Stephanie Fisher

Of course I would say 200 million, as I said here as the CFO, but we can let that number get in to 150, $125 million to $150 million, if we have to. Remember that first quarter is a cash set for us with revenues being down and that been a huge outflow of cash for the licensing and those kinds of things in the first quarter. So first quarter gets a little lower than we would like, definitely lower than the 200 million, but then we start building cash in second and third quarter.

David Ross

But more is better or is there --.

Stephanie Fisher

More is better. More is absolutely better. More truck. But if you think about the amount of tractors that we’re going to bring online here in the fourth and first quarter, that’s going to be up pretty good stuck on liquidity. So, we manage it tightly.

David Ross

But at least it should help the EBITDA portion to leverage ratio.

Operator

And our next question comes from Scott Group of Wolfe Research.

Scott Group

Can you say on what the October tonnage numbers, what’s weight per shipment up in freight and regional?

Stephanie Fisher

For October, I don’t have those stats at this point in time.

James Welch

I’d say it’s similar to up just a bit versus third quarter, it’s not going down.

Scott Group

Are you seeing a pickup in shipment count not weight per shipment?

James Welch

No, I’m saying weight per shipment is as good or maybe perhaps a little better in October than it was in the third quarter.

Scott Group

Can you say if New Penn was profitable or not in the third quarter, and what kind of drag on regional already you think New Penn is right now?

James Welch

Well on that one, we don’t report individual [up-co] results in that regional segment. But I can tell you we are very positive on the New Penn brand. One of the challenges that we had in New Penn is they were lagging really the technology that the other three operating companies had in place and we spent a lot of time, energy and effort to implementing about seven projects this past year, and I think you got to focus off of their day to day business just a bit, because we were changing so many things. But feel good about the recovery plan, feel good about the new President, Howard Moshier, like the direction that we’re already headed there.

So with the environment that we are in from the yield perspective and business opportunities, I think you’ll see New Penn rebound next year.

Scott Group

No, that all makes sense. But I’m just trying to get a sense of where the other two – your margins at regional were flattish, down 20 basis points in the quarter. Were you seeing good improvement at the other two and just one fell out of pressure and you’ve got a plan to fix it or is that not the way to think about the third quarter?

James Welch

Certainly the other two regional companies operated better than New Penn, I can say that. And yes, we do have a plan in place that we think will fix New Penn with just what I mentioned a minute ago.

Scott Group

Okay. Stephanie can you just walk us through, what is the CapEx and it would be helpful if you have like the cash and then the CapEx equivalent number for ’17 and then your view on ’18?

Stephanie Fisher

If we think about the projections that we’ve given throughout the year, we expect CapEx to be and including CapEx equivalent to be at that 6% to 8% of revenues. So call it $250 million to $300 million of CapEx equivalent. As we move forward, and we continue to refresh the fleet, we know that the industry average is 5%. We know that we have more work to do than just to be average. So we’ll probably still push the higher limits of that probably in that 6% range as we move forward through 2018 and probably beyond.

Scott Group

And most of this is in leases, what’s the third good number to think about the rent expense, the drag on margin next year with all of the new equipment coming out? I understand there’s benefit from the equipment, but I just want to understand just the financial impact of the leases on operating income.

Stephanie Fisher

That rent expense is probably an additional, probably 1% to 1.5%, maybe 2% of additional lease expense there. If we think about the magnitude of leases that are coming on here over the next four to five months, it will be probably in that 1.5% to 2% range.

Scott Group

1.5% to 2% of what?

Stephanie Fisher

Additional cost as we think about how much lease cost that we have today.

Scott Group

Relative to the current lease cost.

Stephanie Fisher

That’s exactly right, yes.

Scott Group

And then last question, so were the covenants, I think the covenant gets a real tougher in the fourth quarter. So there’s not like a ton of cushion there. Are you in any – can you say if you are in any discussion with the bank to get another amendment or are you comfortable and you don’t need one?

Stephanie Fisher

At this point in time we are comfortable that we don’t need one. The projections we gave more than get us above that covenant range and we’ll continue to manage it as we move forward.

Operator

And now we have a follow-up question from Brad Delco of Stephens.

Brad Delco

May be just a follow-up quickly on what Scott just asked, the 1% to 2% of additional rent expenses, is that as a percentage of revenue or you’re just saying from what the expense is now, it will be up 1% to 2%.

Stephanie Fisher

From what the expense is now.

Brad Delco

Just want to make sure that I clarify that. And then I noticed below the line there was $10 million of other expense, what was that?

Stephanie Fisher

So part of the term loan extension, we had to expense some of our cost related to that. So that was about $7 million of expenses related to the term loan that were expensed part of the accounting of that extension.

Brad Delco

Kind of non-recurring in nature, I guess is fair to say.

Stephanie Fisher

You bet.

Operator

This concludes our question and answer session. I would like to turn the conference back over to the company for any closing remarks.

James Welch

Again to summarize, we are certainly optimistic about improving our fourth quarter performance compared to a year ago, and we’re excited and looking forward to watch, should be a solid start in 2018 for the trucking industry. So we appreciate all your time and interest in the company, and have a good rest of the day. Thanks.

Operator

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.