Saia(SAIA) - 2022 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1: Financial Statements The unaudited condensed consolidated financial statements for Q1 2022 show total assets of $1.93 billion, a 36.6% revenue increase to $661.2 million, net income of $79.4 million, and operating cash flow of $96.0 million Condensed Consolidated Balance Sheets | Balance Sheet Items (in thousands) | March 31, 2022 | December 31, 2021 | | :--- | :--- | :--- | | Total current assets | $510,666 | $416,255 | | Total assets | $1,932,349 | $1,845,250 | | Total current liabilities | $339,121 | $321,348 | | Total liabilities | $640,859 | $624,917 | | Total stockholders' equity | $1,291,490 | $1,220,333 | Condensed Consolidated Statements of Operations | Income Statement Items (in thousands) | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | Operating Revenue | $661,216 | $484,074 | | Total operating expenses | $557,767 | $435,360 | | Operating Income | $103,449 | $48,714 | | Net Income | $79,424 | $37,291 | | Diluted Earnings Per Share | $2.98 | $1.40 | Condensed Consolidated Statements of Stockholders' Equity - Total stockholders' equity increased from $1.22 billion at December 31, 2021, to $1.29 billion at March 31, 2022. The growth was primarily driven by a net income of $79.4 million for the quarter[16] Condensed Consolidated Statements of Cash Flows | Cash Flow Items (in thousands) | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $95,961 | $60,971 | | Net cash used in investing activities | ($45,376) | ($25,388) | | Net cash used in financing activities | ($15,848) | ($7,631) | | Net Increase in Cash and Cash Equivalents | $34,737 | $27,952 | | Cash and Cash Equivalents, end of period | $141,325 | $53,260 | Notes to Condensed Consolidated Financial Statements - The company's primary business is providing national less-than-truckload (LTL) services, which account for over 97% of its revenue. Revenue is recognized over the transit time of a shipment, typically one to five days[24][26] - The company has a $300 million revolving credit facility available through February 2024, with an additional $100 million accordion feature. As of March 31, 2022, there were no outstanding borrowings under this agreement[37][38] - The company is obligated under finance leases for revenue equipment, with total liabilities of $44.9 million as of March 31, 2022, at a weighted average interest rate of 3.6%[39] Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations Management's discussion highlights strong Q1 2022 performance with operating revenue up 36.6% to $661.2 million, operating income more than doubling to $103.4 million, and an improved operating ratio of 84.4% Q1 2022 vs. Q1 2021 Performance Highlights | Metric | Q1 2022 | Q1 2021 | % Change | | :--- | :--- | :--- | :--- | | Operating Revenue | $661.2 M | $484.1 M | +36.6% | | Operating Income | $103.4 M | $48.7 M | +112.4% | | Operating Ratio | 84.4% | 89.9% | -5.5 pts | | Diluted EPS | $2.98 | $1.40 | +112.9% | | LTL Tonnage (per workday) | - | - | +9.5% | | LTL Shipments (per workday) | - | - | +5.7% | - Revenue growth was primarily driven by increased revenue per shipment, higher tonnage, and a rise in fuel surcharge revenue, which constituted 16.8% of operating revenue in Q1 2022, up from 12.9% in Q1 2021[61][62] - Operating expenses increased due to higher headcount to support growth, a 4.7% wage increase in August 2021, expanded use of purchased transportation, and higher diesel fuel costs[64] - The company projects net capital expenditures for 2022 to be in excess of $500 million, a substantial increase from $277 million in 2021, to fund investments in equipment, real estate, and technology[69][80] Item 3: Quantitative and Qualitative Disclosures About Market Risk The company's primary market risks are interest rate fluctuations and fuel price volatility, with fuel risk largely mitigated by a weekly-reset surcharge program, and $44.9 million in fixed-rate debt at a 3.6% weighted average interest rate as of March 31, 2022 - The company's main market risks are interest rate fluctuations and fuel price volatility. A fuel surcharge program, which is reset weekly based on average national fuel prices, is used to mitigate exposure to fuel costs[86] Fixed Rate Debt Principal Cash Flows (as of March 31, 2022) | (in millions) | 2022 | 2023 | 2024 | 2025 | 2026 | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Fixed rate debt | $14.0 | $14.5 | $10.2 | $5.3 | $0.9 | $44.9 | | Average interest rate | 3.6% | 3.6% | 3.6% | 3.6% | 3.6% | 3.6% | Item 4: Controls and Procedures Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of March 31, 2022, with no material changes to internal control over financial reporting during the quarter - The company's CEO and CFO concluded that as of the end of the period, the company's disclosure controls and procedures are effective to ensure that required information is recorded, processed, summarized, and reported within the specified time periods[89][90] - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[91] PART II. OTHER INFORMATION Item 1: Legal Proceedings The company is involved in routine legal proceedings, for which management believes adequate provisions have been made, and does not anticipate a material adverse effect on its financial condition - The company is subject to routine legal proceedings but believes the ultimate outcome will not materially impact its financial condition, though it could affect results in a specific period[33][97] Item 1A: Risk Factors This section confirms no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2021 - There have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2021[97] Item 2: Unregistered Sales of Equity Securities and Use of Proceeds The report details the purchase of 8,137 equity shares in open market transactions during the quarter by the Saia, Inc. Executive Capital Accumulation Plan Issuer Purchases of Equity Securities (Q1 2022) | Period | Total Shares Purchased | | :--- | :--- | | Jan 2022 | 5,667 | | Feb 2022 | 2,470 | | Mar 2022 | 0 | | Total | 8,137 | Other Items (3, 4, 5) The company reported no defaults upon senior securities, no mine safety disclosures, and no other information required under Item 5 for the reporting period - The company reported "None" for Item 3 (Defaults Upon Senior Securities), Item 4 (Mine Safety Disclosures), and Item 5 (Other Information)[100] Item 6: Exhibits This section lists all exhibits filed with the Form 10-Q, including corporate governance documents and required CEO and CFO certifications - The exhibits filed with this report include corporate governance documents, CEO/CFO certifications pursuant to Exchange Act Rules and the Sarbanes-Oxley Act of 2002, and financial data formatted in iXBRL[101]