Financial Data and Key Metrics Changes - Consolidated freight revenue increased by 7.8% or approximately $19.5 million to $270.6 million [6] - Consolidated adjusted operating income shrank by 39.4% to $10.9 million due to margin compression in several segments [7] - Net indebtedness increased by $76.9 million to $296.6 million, yielding an adjusted leverage ratio of approximately 2.3 times and a debt-to-capital ratio of 42.3% [7] - Average age of tractors increased to 24 months from 20 months year-over-year [8] - Adjusted return on average invested capital was 5.6% compared to 8.1% in the prior year [8] Business Segment Data and Key Metrics Changes - The expedited segment reported an adjusted operating ratio of 97.2%, which did not meet expectations due to external challenges including a U.S. government shutdown [8] - Dedicated segment achieved a 92.2 adjusted operating ratio, the best for any quarter during the year, with a fleet growth of 90 average tractors or approximately 6.3% [9] - Managed freight saw significant revenue improvement due to the Star Logistics Solutions acquisition, but margins were compressed due to rising costs [10] - Warehousing segment experienced a 4.6% increase in freight revenue but a decline in adjusted operating income due to startup costs and operational inefficiencies [11] Market Data and Key Metrics Changes - The freight market is evolving towards equilibrium, with spot rates rising meaningfully and increased bid activity from shippers [3] - Bids in January were up 33% compared to the fourth quarter, indicating heightened interest from shippers [23] - Concerns about capacity and increased cargo theft have influenced shippers' demand for high-value programs [24] Company Strategy and Development Direction - The company aims to reduce balance sheet leverage and improve return on capital through fleet optimization and targeted rate increases [5] - Focus on growing high-service niches within the dedicated segment while reducing exposure to commoditized freight [9] - The acquisition of Star Logistics Solutions is expected to be accretive to earnings in the first half of 2026, diversifying the business mix [6] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about improving freight fundamentals and the ability to capture operating leverage in 2026 [12] - The first quarter is expected to be impacted by seasonality and extreme weather, but improvements are anticipated later in the year [12] - Management highlighted the importance of rate increases to improve margins and expressed optimism about ongoing conversations with customers [16][54] Other Important Information - The company has deferred some trades and moved a group of assets to held-for-sale status to improve operations and balance sheet [4] - The strategic focus for 2026 includes integrating the Star acquisition and preparing for new business opportunities [34] Q&A Session Summary Question: What are the expectations for price increases in the expedited segment? - Management indicated that the average price increase is around 3.5% for the first three weeks of January, with optimism about ongoing conversations with customers [15][16] Question: How is the warehousing segment performing? - Revenue is up, but profit is down due to startup costs; management expects improvement in the coming quarters [25][30] Question: What is the outlook for managed freight revenue? - Revenue is expected to be flat to up on a sequential basis, with growth anticipated in the third and fourth quarters [64] Question: How will the company respond to potential demand recovery in 2026? - The strategy will focus on reclaiming profits lost over the past four years and ensuring rates are acceptable before increasing capacity [95][96] Question: What percentage of the customer book renews in each quarter? - Approximately 40% of customers renew in the second quarter, with 60% expected to take multiple rate increases [99][100]

Financial Data and Key Metrics Changes - Consolidated freight revenue increased by 7.8% or approximately $19.5 million to $270.6 million [7] - Consolidated adjusted operating income shrank by 39.4% to $10.9 million due to margin compression in several segments [8] - Net indebtedness increased by $76.9 million to $296.6 million, yielding an adjusted leverage ratio of approximately 2.3 times and a debt-to-capital ratio of 42.3% [8] - Average age of tractors increased to 24 months from 20 months year-over-year [9] - Adjusted return on average invested capital was 5.6% compared to 8.1% in the prior year [9] Business Line Data and Key Metrics Changes - The expedited segment reported an adjusted operating ratio of 97.2%, which did not meet expectations due to external challenges including a U.S. government shutdown [9][10] - The dedicated segment achieved a 92.2 adjusted operating ratio, the best for any quarter during the year, with a fleet growth of 90 average tractors or approximately 6.3% [10] - Managed freight saw significant revenue improvement due to the Star Logistics Solutions acquisition, but margins were compressed due to rising costs [11] - The warehousing segment experienced a 4.6% increase in freight revenue but a decline in adjusted operating income due to startup costs and operational inefficiencies [12] Market Data and Key Metrics Changes - The freight market is evolving towards equilibrium, with spot rates rising meaningfully and increased bid activity from shippers [3] - Bids in January were up 33% compared to the fourth quarter, indicating heightened interest from shippers [25] - Concerns about capacity and cargo theft have increased, influencing shippers' demand for high-value programs [26] Company Strategy and Development Direction - The company aims to reduce balance sheet leverage and improve return on capital through fleet optimization and targeted rate increases [5][10] - A small acquisition of a truckload brokerage company, Star Logistics Solutions, is expected to be accretive to earnings in the first half of 2026 [7] - The focus will be on growing high-service niches within the dedicated segment while reducing exposure to commoditized freight [11] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about improving freight fundamentals and the ability to capture operating leverage in 2026 [14] - The first quarter is expected to be impacted by seasonality and extreme weather, but improvements are anticipated later in the year [14] - Management highlighted the importance of executing their strategy effectively in 2026, focusing on integration and capital allocation [37] Other Important Information - The company has deferred some trades and moved a group of assets to held-for-sale status due to declining used equipment values [4] - The acquisition of Star Logistics Solutions is aimed at diversifying the business mix and enhancing profitability [7] Q&A Session Summary Question: Price increases in the expedited segment - Management indicated that the average price increase is around 3.5% for the first three weeks of January, with positive momentum in conversations with customers [17][18] Question: Expectations for warehousing revenue and bookings - Management expects improvement in warehousing revenue in Q1 compared to Q4, with a commitment to driving organic growth [30][31] Question: Impact of government shutdown on expedited segment - Management confirmed that the government shutdown significantly impacted the expedited segment's performance [49] Question: Future margin expectations for expedited and dedicated segments - Management aims for expedited margins in the 80s and dedicated margins in the high 80s to 90s over the long term [73] Question: Flexibility in responding to improved demand - Management plans to reclaim profits lost over the past four years and focus on rate increases rather than adding excessive capacity [94]

Core Points - Barrett Directline Delivery Services will become a wholly owned subsidiary of C&M Transport, combining two transportation providers specializing in time-sensitive and expedited ground freight [1] - The financial terms of the transaction were not disclosed, and Barrett Directline will start operating under the C&M banner on November 1 [1] - The merger aims to leverage over 60 years of industry experience to expand market reach and enhance shipping solutions and flexibility [2] Company Overview - C&M Transport is headquartered near Cleveland, Ohio, with 17 locations nationwide, offering expedited freight, air charter, and other 3PL management services, operating 17 power units according to FMCSA data [2] - Barrett Directline, based in Rogers, Arkansas, provides same- and next-day coverage across the contiguous United States and Canada, with warehousing services that include repackaging, cross-docking, and long-term storage, operating 14 power units according to FMCSA data [3] Transition Plans - The priority during the transition is to ensure a seamless integration for clients, partners, and employees, with operations being integrated over the next four weeks and final transition and regulatory approvals expected by November 1, 2025 [4]