Forward Air(US:FWRD)2019-10-25 18:01Financial Data and Key Metrics Changes - The company reported a 9% year-over-year revenue growth for Q3 2019, with a 10% growth in operating income when excluding reserve impacts [10][26] - Purchase transportation accounted for 45.5% of LTL revenue, with a 160 basis point dilution from the FSA acquisition [26] Business Line Data and Key Metrics Changes - The core LTL business saw a significant shift, with 40% of network revenue now coming from door-to-door services [11] - The 3PL segment experienced a 75% year-over-year growth, with the rate per shipment increasing by 60% [13] - Final mile business added $10 million in run rate new business, with a growing pipeline [15] Market Data and Key Metrics Changes - Tonnage per day for Q3 was down 5.1%, with a slight improvement to down 1.9% in October [34][38] - The company is experiencing pricing discipline while winning back business, indicating a positive trend in market positioning [40] Company Strategy and Development Direction - The company aims for double-digit annual revenue growth and margins, focusing on organic growth in LTL and targeted M&A in intermodal and final mile [7][8] - There is an ongoing evaluation of synergies between LTL and truckload operations to drive organic growth and lower costs [27][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about Q4 and 2020, highlighting the importance of operational efficiencies and strategic initiatives [67] - The potential impact of macroeconomic headwinds was acknowledged, but management remains focused on winning back business and expanding into new segments [61][62] Other Important Information - The company is committed to social responsibility initiatives, including support for military veterans and anti-trafficking efforts [21][22] - A shift in capital expenditures towards technology and IT is planned for 2020, with a focus on enhancing customer experiences and operational efficiencies [80][81] Q&A Session Summary Question: Monthly tonnage trends and fourth quarter revenue guidance - Tonnage per day was down 5.1% in Q3, with a slight improvement in October to down 1.9% [34][38] Question: Impact of accident costs on segments - The initial impact was felt in the LTL business, with subsequent effects in corporate [41][42] Question: Synergies between truckload and LTL - Positive effects from combined operations are expected, but the exact impact on segment results is hard to predict [46][50] Question: Revenue per 100-weight outlook for 2020 - Revenue per 100-weight is expected to remain positive despite industry pressures [68][69] Question: Pool business growth and expectations for 2020 - Continued growth and pricing discipline are anticipated in the pool business, with strong financial outcomes expected [76][77] Question: 2020 CapEx expectations - CapEx is expected to be around $30 million to $35 million, with a shift towards technology investments [80][81]