What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-08-08 compared with 2025-05-09 · 210 added, 70 removed, 432 unchanged (39% of the section changed)

27 unchanged sentences

192,000,000 shares authorized;

81,493,424 shares at March 31, 2025, and 81,463,938 shares at December 31, 2024, issued and outstanding

81,520,424 shares at June 30, 2025, and 81,463,938 shares at December 31, 2024, issued and outstanding

Additional paid-in capital

5 unchanged sentences

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

Ended March 31,

Ended June 30,

(In thousands, except per share information)

29 unchanged sentences

Dividends on common stock, $ 0.06 per share

Balance at June 30, 2025

The accompanying notes are an integral part of these consolidated condensed financial statements.

MARTEN TRANSPORT, LTD.

CONSOLIDATED CONDENSED STATEMENTS OF STOCKHOLDERS ’ EQUITY

(In thousands)

Balance at December 31, 2023

4 unchanged sentences

Balance at March 31, 2024

Issuance of common stock from share-based payment arrangement exercises

Share-based payment arrangement compensation expense

Dividends on common stock, $ 0.06 per share

Balance at June 30, 2024

The accompanying notes are an integral part of these consolidated condensed financial statements.

1 unchanged sentence

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

Ended March 31,

Ended June 30,

(In thousands)

29 unchanged sentences

Operating lease assets and liabilities acquired

Supplemental disclosure of cash flow information:

Cash paid for income taxes

The accompanying notes are an integral part of these consolidated condensed financial statements.

1 unchanged sentence

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2025

SIX MONTHS ENDED JUNE 30, 2025

(1) Consolidated Condensed Financial Statements

7 unchanged sentences

Basic and diluted earnings per common share were computed as follows:

Ended March 31,

Ended June 30,

(In thousands, except per share amounts)

4 unchanged sentences

Diluted earnings per common share

Options totaling 605,371 and 524,900 equivalent shares for the three-month periods ended March 31, 2025 and March 31, 2024, respectively, were outstanding but were not included in the calculation of diluted earnings per share because including the options in the denominator would be antidilutive, or decrease the number of weighted-average shares, due to their exercise prices exceeding the average market price of the common shares, or because inclusion of average unrecognized compensation expense in the calculation would cause the options to be antidilutive.

Unvested performance unit awards totaling 114,276 and 82,788 equivalent shares for the three-month periods ended March 31, 2025 and March 31, 2024, respectively, were considered outstanding but were not included in the calculation of diluted earnings per share because inclusion of average unrecognized compensation expense in the calculation would cause the performance units to be antidilutive.

Options totaling 638,071 and 615,898 equivalent shares for the three-month and six-month periods ended June 30, 2025, respectively, and 543,500 and 533,400 equivalent shares for the three-month and six-month periods ended June 30, 2024, respectively, were outstanding but were not included in the calculation of diluted earnings per share because including the options in the denominator would be antidilutive, or decrease the number of weighted-average shares, due to their exercise prices exceeding the average market price of the common shares, or because inclusion of average unrecognized compensation expense in the calculation would cause the options to be antidilutive.

Unvested performance unit awards totaling 181,111 equivalent shares for each of the three-month and six-month periods ended June 30, 2025, and 148,520 equivalent shares for each of the three-month and six-month periods ended June 30, 2024, were considered outstanding but were not included in the calculation of diluted earnings per share because inclusion of average unrecognized compensation expense in the calculation would cause the performance units to be antidilutive.

(3) Long-Term Debt

1 unchanged sentence

The credit agreement amends, restates and continues in its entirety our previous credit agreement, as amended.

At March 31 2025, there was no outstanding principal balance on the facility.

At June 30, 2025, there was no outstanding principal balance on the facility.

As of that date, we had outstanding standby letters of credit to guarantee settlement of self-insurance claims of $ 22.4 million and remaining borrowing availability of $ 7.6 million.

2 unchanged sentences

This facility bears interest at a variable rate based on the Term SOFR Rate plus applicable margins.

The interest rate for the facility that would apply to outstanding principal balances was 7.5 % at March 31, 2025.

The interest rate for the facility that would apply to outstanding principal balances was 7.5 % at June 30, 2025.

Our credit agreement effective in August 2022 prohibits us from paying, in any fiscal year, stock redemptions and dividends in excess of $ 150 million.

The current credit agreement also contains restrictive covenants which, among other matters, require us to maintain compliance with cash flow leverage and fixed charge coverage ratios.

We were in compliance with all covenants at March 31, 2025 and December 31, 2024.

We were in compliance with all covenants at June 30, 2025 and December 31, 2024.

(4) Related Party Transactions

1 unchanged sentence

Bauer, the chairman of the board and chief executive officer of BBI, is one of our directors.

We paid BBI $ 100 in the first three months of 2025 and $ 2,000 in the first three months of 2024 for tires and related services.

In addition, we paid $ 166,000 in the first three months of 2025 and $ 438,000 in the first three months of 2024 to tire manufacturers for tires that were provided by BBI.

We paid BBI $ 13,000 in the first six months of 2025 and $ 14,000 in the first six months of 2024 for tires and related services.

In addition, we paid $ 613,000 in the first six months of 2025 and $ 1.2 million in the first six months of 2024 to tire manufacturers for tires that were provided by BBI.

BBI received commissions from the tire manufacturers related to these purchases.

We paid Durand Builders Service, Inc.

$ 7,000 in the first six months of 2024 for building repairs and had no transactions with that company in the first six months of 2025.

Hagness, one of our directors, is the chief executive officer and principal stockholder of Durand Builders Service, Inc.

(5) Share Repurchase Program

1 unchanged sentence

On May 3, 2022, our Board of Directors approved and we announced an additional increase from current availability in our existing share repurchase program providing for the repurchase of up to $ 50.0 million, or approximately 3.1 million shares of our common stock.

The share repurchase program allows purchases on the open market or through private transactions in accordance with Rule 10b-18 of the Exchange Act.

The share repurchase program allows purchases on the open market or through private transactions in accordance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended.

The timing and extent to which we repurchase shares depends on market conditions and other corporate considerations.

1 unchanged sentence

We repurchased and retired 1.3 million shares of common stock for $ 25.0 million in the first quarter of 2022, and 963,000 shares of common stock for $ 16.8 million in the second quarter of 2022.

We did not repurchase any shares in the first quarter of 2025, in 2024 or 2023, or in the third or fourth quarters of 2022.

As of March 31, 2025, future repurchases of up to $ 33.2 million, or approximately 2.2 million shares, were available in the share repurchase program.

We did not repurchase any shares in the first six months of 2025, in 2024 or 2023, or in the third or fourth quarters of 2022.

As of June 30, 2025, future repurchases of up to $ 33.2 million, or approximately 2.2 million shares, were available in the share repurchase program.

(6) Dividends

In 2010, we announced a regular cash dividend program to our stockholders, subject to approval each quarter.

Quarterly cash dividends of $ 0.06 per share of common stock were paid in each of the first quarters of 2025 and 2024 which totaled $ 4.9 million in each period.

Quarterly cash dividends of $ 0.06 per share of common stock were paid in each of the first two quarters of 2025 and 2024 which totaled $ 9.8 million in each period.

(7) Accounting for Share-based Payment Arrangement Compensation

We account for share-based payment arrangements in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, 718, Compensation – Stock Compensation .

During the first three months of 2025, there were no significant changes to the structure of our stock-based award plans.

Pre-tax compensation expense related to stock options and performance unit awards recorded in each of the first three months of 2025 and 2024 was $ 407,000 and $ 353,000 , respectively.

During the first six months of 2025, there were no significant changes to the structure of our stock-based award plans.

Pre-tax compensation expense related to stock options and performance unit awards recorded in each of the first six months of 2025 and 2024 was $ 1.3 million and $ 1.4 million, respectively.

(8) Fair Value of Financial Instruments

4 unchanged sentences

We self-insure, in part, for losses relating to workers’ compensation, auto liability, general liability, cargo and property damage claims, along with employees’ health insurance, with varying risk retention levels.

We renewed our liability insurance policies effective June 1, 2024 and are responsible for the first $ 2.0 million on each auto liability claim with an annual $ 5.0 million aggregate for claims between $ 10.0 million and $ 20.0 million.

We renewed our liability insurance policies effective June 1, 2025, and are responsible for the first $ 3.0 million on each auto liability claim.

For the policy year effective June 1, 2024, we are responsible for the first $ 2.0 million on each auto liability claim.

For both policy years, we are also responsible for an annual $ 5.0 million aggregate for claims between $ 10.0 million and $ 20.0 million.

For the policy year effective June 1, 2023, we are responsible for the first $ 1.0 million on each auto liability claim with no aggregates.

26 unchanged sentences

The main factors that affect our Intermodal revenue are the rate per mile and other charges we receive from our customers.

See Note 12 for a description of the agreement we announced on July 22, 2025 to sell the assets and associated customer contracts related to our Intermodal business.

Our Brokerage segment develops contractual relationships with and arranges for third-party carriers to transport freight for our customers in temperature-controlled trailers and dry vans within the United States and into and out of Mexico through Marten Transport Logistics, LLC, which was established in 2007 and operates pursuant to brokerage authority granted by the United States Department of Transportation, or DOT.

8 unchanged sentences

We base our calculation of the amount of revenue to record in each period for individual loads picking up in one period and delivering in the following period using the number of hours estimated to be incurred within each period applied to each estimated transaction price.

Contract assets for this estimated revenue which are classified within prepaid expenses and other within our consolidated condensed balance sheets were $ 2.2 million and $ 1.6 million as of March 31, 2025 and December 31, 2024, respectively.

We had no impairment losses on contract assets in the first three months of 2025 or 2024.

We had no impairment losses on contract assets in the first six months of 2025 or 2024.

We bill our customers for loads after delivery is complete with standard payment terms of 30 days.

6 unchanged sentences

We do not prepare separate balance sheets by segment and, as a result, assets are not separately identifiable by segment.

Ended March 31,

Ended June 30,

(In thousands)

15 unchanged sentences

We do not prepare separate balance sheets by segment and, as a result, assets are not separately identifiable by segment.

Three Months Ended March 31, 2025 Segment Operating Results

Three Months Ended June 30, 2025 Segment Operating Results

(In thousands)

13 unchanged sentences

Operating ratio, net of fuel surcharges

Three Months Ended March 31, 2024 Segment Operating Results

Six Months Ended June 30, 2025 Segment Operating Results

(In thousands)

13 unchanged sentences

Operating ratio, net of fuel surcharges

Three Months Ended June 30, 2024 Segment Operating Results

(In thousands)

Operating revenue

Operating expense (income):

Salaries, wages and benefits

Purchased transportation

Fuel and fuel taxes

Supplies and maintenance

Operating taxes and licenses

Insurance and claims

Communications and utilities

Gain on disposition of revenue equipment

Total operating expenses

Operating income/(loss)

Operating ratio

Operating ratio, net of fuel surcharges

Six Months Ended June 30, 2024 Segment Operating Results

(In thousands)

Operating revenue

Operating expense (income):

Salaries, wages and benefits

Purchased transportation

Fuel and fuel taxes

Supplies and maintenance

Operating taxes and licenses

Insurance and claims

Communications and utilities

Gain on disposition of revenue equipment

Total operating expenses

Operating income/(loss)

Operating ratio

Operating ratio, net of fuel surcharges

(11) Use of Estimates

4 unchanged sentences

Ultimate results could differ from these estimates.

(12) Sale of Intermodal Business Assets Subsequent Event

On July 22, 2025, we announced that we have entered into an agreement to sell the assets related to our Intermodal business to Hub Group, Inc.

The transaction is structured as an asset sale of certain Intermodal equipment, including over 1,200 refrigerated containers, and associated customer contracts to Hub Group, Inc.

for $ 51.8 million in cash, and is expected to close by the end of the third quarter subject to certain customary closing conditions.

The transaction is not expected to have a material impact on our results of operations.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations.

16 unchanged sentences

The main factors that affect our Intermodal revenue are the rate per mile and other charges we receive from our customers.

See Note 12 for a description of the agreement we announced on July 22, 2025 to sell the assets and associated customer contracts related to our Intermodal business.

We retain the billing, collection and customer management responsibilities.

2 unchanged sentences

In addition to the factors discussed above, our operating revenue is also affected by, among other things, the United States economy, inventory levels, the level of truck and rail capacity in the transportation market, a contracting driver market, severe weather conditions and specific customer demand.

Our operating revenue decreased $26.5 million, or 10.6%, in the first three months of 2025 from the first three months of 2024.

Our operating revenue, net of fuel surcharges, decreased $19.9 million, or 9.2%, compared with the first three months of 2024.

Truckload segment revenue, net of fuel surcharges, decreased 5.2% from the first three months of 2024, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Dedicated segment revenue, net of fuel surcharges, decreased 13.0% from the first three months of 2024, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Intermodal segment revenue, net of fuel surcharges, decreased 22.7% from the first three months of 2024, primarily due to decreases in both our number of loads and our revenue per load.

Brokerage segment revenue decreased 7.5% from the first three months of 2024, primarily due to a decrease in our revenue per load.

Fuel surcharge revenue decreased to $27.4 million in the first three months of 2025 from $33.9 million in the first three months of 2024.

Our operating revenue decreased $42.8 million, or 8.6%, in the first six months of 2025 from the first six months of 2024.

Our operating revenue, net of fuel surcharges, decreased $29.7 million, or 6.9%, compared with the first six months of 2024.

Truckload segment revenue, net of fuel surcharges, decreased 4.4% from the first six months of 2024, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Dedicated segment revenue, net of fuel surcharges, decreased 11.1% from the first six months of 2024, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

Intermodal segment revenue, net of fuel surcharges, decreased 21.5% from the first six months of 2024, primarily due to decreases in both our number of loads and our revenue per load.

Brokerage segment revenue decreased 0.3% from the first six months of 2024, primarily due to a decrease in our revenue per load, partially offset by an increase in our number of loads.

Fuel surcharge revenue decreased to $53.5 million in the first six months of 2025 from $66.6 million in the first six months of 2024.

Our profitability is impacted by the variable costs of transporting freight for our customers, fixed costs, and expenses containing both fixed and variable components.

10 unchanged sentences

This expense is included within purchased transportation in our consolidated condensed statements of operations.

Our operating income declined 52.2% to $5.9 million in the first three months of 2025 from $12.3 million in the first three months of 2024.

Our operating expenses as a percentage of operating revenue, or “operating ratio,” was 97.4% in the first three months of 2025 and 95.1% in the first three months of 2024.

Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, increased to 97.0% in the first three months of 2025 from 94.3% in the first three months of 2024.

Our net income declined 55.1% to $4.3 million, or $0.05 per diluted share, in the first three months of 2025 from $9.6 million, or $0.12 per diluted share, in the first three months of 2024.

Our operating income declined 29.8% to $15.6 million in the first six months of 2025 from $22.2 million in the first six months of 2024.

Our operating expenses as a percentage of operating revenue, or “operating ratio,” was 96.6% in the first six months of 2025 and 95.5% in the first six months of 2024.

Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, increased to 96.1% in the first six months of 2025 from 94.8% in the first six months of 2024.

Our net income declined 34.3% to $11.5 million, or $0.14 per diluted share, in the first six months of 2025 from $17.5 million, or $0.22 per diluted share, in the first six months of 2024.

Our business requires substantial ongoing capital investments, particularly for new tractors and trailers.

At March 31, 2025, we had $39.9 million of cash and cash equivalents, $767.5 million in stockholders’ equity and no long-term debt outstanding.

In the first three months of 2025, net cash flows provided by operating activities of $36.2 million were primarily used to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $6.0 million, to pay cash dividends of $4.9 million and to purchase other assets in the amount of $2.4 million, resulting in a $22.6 million increase in cash and cash equivalents.

At June 30, 2025, we had $35.1 million of cash and cash equivalents, $770.7 million in stockholders’ equity and no long-term debt outstanding.

In the first six months of 2025, net cash flows provided by operating activities of $69.4 million were primarily used to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $38.8 million, to pay cash dividends of $9.8 million and to purchase other assets in the amount of $2.7 million, resulting in a $17.8 million increase in cash and cash equivalents.

We estimate that capital expenditures, net of proceeds from dispositions, will be approximately $65 million for the remainder of 2025.

Quarterly cash dividends of $0.06 per share of common stock were paid in the first three months of 2025 which totaled $4.9 million.

Quarterly cash dividends of $0.06 per share of common stock were paid in each of the first two quarters of 2025 which totaled $9.8 million.

We believe our sources of liquidity are adequate to meet our current and anticipated needs for at least the next twelve months.

13 unchanged sentences

The following table sets forth for the periods indicated certain operating statistics regarding our revenue and operations:

Ended March 31,

Ended June 30,

Truckload Segment:

16 unchanged sentences

Includes tractors driven by both company-employed drivers and independent contractors.

Independent contractors provided 82 and 96 tractors as of March 31, 2025 and 2024, respectively.

Comparison of Three Months Ended March 31, 2025 to Three Months Ended March 31, 2024

Independent contractors provided 80 and 90 tractors as of June 30, 2025 and 2024, respectively.

Comparison of Three Months Ended June 30, 2025 to Three Months Ended June 30, 2024

The following table sets forth for the periods indicated our operating revenue, operating income and operating ratio by segment, along with the change for each component:

20 unchanged sentences

Our operating revenue, net of fuel surcharges, decreased $9.8 million, or 4.6%, to $203.8 million in the 2025 period from $213.5 million in the 2024 period.

This decrease in the 2025 period was due to a $9.3 million decrease in Dedicated revenue, net of fuel surcharges, a $4.9 million decrease in Truckload revenue, net of fuel surcharges, a $3.0 million decrease in Intermodal revenue, net of fuel surcharges, and a $2.7 million decrease in Brokerage revenue.

This decrease in the 2025 period was due to a $6.1 million decrease in Dedicated revenue, net of fuel surcharges, a $3.6 million decrease in Truckload revenue, net of fuel surcharges, and a $2.6 million decrease in Intermodal revenue, net of fuel surcharges, partially offset by a $2.5 million increase in Brokerage revenue.

Fuel surcharge revenue decreased to $26.1 million in the 2025 period from $32.7 million in the 2024 period.

2 unchanged sentences

Truckload segment revenue, net of fuel surcharges, decreased $3.6 million, or 3.7%, to $92.5 million in the 2025 period from $96.0 million in the 2024 period, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

The operating ratio increased to 100.3% in the 2025 period from 99.6% in the 2024 period.

Impacting the 2025 period operating ratio was higher insurance and claims, depreciation and maintenance costs, partially offset by lower company driver compensation, as a percentage of revenue, along with improved average revenue per tractor.

The operating ratio improved to 97.8% in the 2025 period from 99.0% in the 2024 period.

Impacting the 2025 period operating ratio was lower company driver compensation, as a percentage of revenue, increased gain on disposition of revenue equipment and improved average revenue per tractor, partially offset by higher insurance and claims and depreciation costs, as a percentage of revenue.

Dedicated segment revenue decreased $9.4 million, or 11.6%, to $71.9 million in the 2025 period from $81.3 million in the 2024 period.

1 unchanged sentence

The operating ratio increased to 92.4% in the 2025 period from 91.8% in the 2024 period.

Impacting the 2025 period operating ratio was higher insurance and claims and depreciation expense, as a percentage of revenue.

Impacting the 2025 period operating ratio was higher insurance and claims and depreciation costs, as a percentage of revenue, partially offset by increased gain on disposition of revenue equipment.

Intermodal segment revenue decreased $3.4 million, or 22.3%, to $11.7 million in the 2025 period from $15.1 million in the 2024 period.

1 unchanged sentence

The operating ratio in the 2025 period increased to 106.3% from 104.5% in the 2024 period.

Impacting the 2025 period operating ratio was the decrease in our revenue per load along with higher depreciation and purchased transportation costs, as a percentage of revenue.

Brokerage segment revenue decreased $2.7 million, or 7.5%, to $33.0 million in the 2025 period from $35.7 million in the 2024 period, primarily due to a decrease in our revenue per load.

Impacting the 2025 period operating ratio was the decrease in our revenue per load along with higher purchased transportation costs, partially offset by lower company driver compensation, both as a percentage of revenue.

Brokerage segment revenue increased $2.5 million, or 6.6%, to $39.9 million in the 2025 period from $37.4 million in the 2024 period, primarily due to an increase in our number of loads.

The operating ratio in the 2025 period of 93.2% was up from 92.3% in the 2024 period.

This increase was primarily due to an increase in the amounts payable to carriers for transportation services which we arranged as a percentage of our Brokerage revenue.

This increase was primarily due to higher insurance and claims costs and an increase in the amounts payable to carriers for transportation services which we arranged as a percentage of our Brokerage revenue.

The following table sets forth for the periods indicated the dollar and percentage increase or decrease of the items in our unaudited consolidated condensed statements of operations, and those items as a percentage of operating revenue:

19 unchanged sentences

Salaries, wages and benefits expense decreased $7.9 million, or 9.2%, in the 2025 period from the 2024 period.

This decrease resulted primarily from both lower company driver compensation expense of $7.6 million and non-driver compensation expense of $1.1 million.

This decrease resulted primarily from reductions in both company driver compensation expense of $5.5 million and employees’ health insurance expense due to lower self-insured medical claims of $1.7 million.

Purchased transportation consists of amounts payable to railroads and carriers for transportation services we arrange in connection with Brokerage and Intermodal operations and to independent contractor providers of revenue equipment.

This category will vary depending upon the amount and rates, including fuel surcharges, we pay to third-party railroad and motor carriers, the ratio of company drivers versus independent contractors and the amount of fuel surcharges passed through to independent contractors.

Purchased transportation expense decreased $4.2 million in total, or 9.9%, in the 2025 period from the 2024 period.

Amounts payable to carriers for transportation services we arranged in our Brokerage segment decreased $2.1 million to $27.7 million in the 2025 period from $29.8 million in the 2024 period, primarily due to a decrease in our cost per load, which corresponds with the decrease in our revenue per load over the same periods.

Purchased transportation expense decreased $112,000 in total, or 0.3%, in the 2025 period from the 2024 period.

Amounts payable to carriers for transportation services we arranged in our Brokerage segment increased $2.2 million to $33.5 million in the 2025 period from $31.3 million in the 2024 period, primarily due to an increase in our number of loads.

Amounts payable to railroads and drayage carriers for transportation services within our Intermodal segment decreased to $6.4 million in the 2025 period from $7.9 million in the 2024 period, primarily due to a decrease in our number of loads.

The portion of purchased transportation expense related to independent contractors within our Truckload and Dedicated segments, including fuel surcharges, decreased $522,000 in the 2025 period.

The portion of purchased transportation expense related to independent contractors within our Truckload and Dedicated segments, including fuel surcharges, decreased by $775,000 in the 2025 period.

Fuel and fuel taxes decreased by $6.2 million, or 16.0%, in the 2025 period from the 2024 period.

2 unchanged sentences

The United States Department of Energy, or DOE, national average cost of fuel decreased to $3.56 per gallon from $3.86 per gallon in the 2024 period.

Despite this price decrease, our net fuel expense was 4.7% of Truckload, Dedicated and Intermodal segment revenue, net of fuel surcharges, in each of the 2025 and 2024 periods.

Despite this price decrease, our net fuel expense was up slightly to 5.1% of Truckload, Dedicated and Intermodal segment revenue, net of fuel surcharges, in the 2025 period, from 5.0% in the 2024 period.

We have worked diligently to control fuel usage and costs by improving our volume purchasing arrangements and optimizing our drivers’ fuel purchases with national fuel centers, focusing on shorter lengths of haul, installing and tightly managing the use of auxiliary power units in our tractors to minimize engine idling and improving fuel usage in the temperature-control units on our trailers.

1 unchanged sentence

Supplies and maintenance consist of repairs, maintenance, tires, parts, oil and engine fluids, along with load-specific expenses including loading/unloading, tolls, pallets and trailer hostling.

Our supplies and maintenance expense decreased $557,000, or 3.5%, from the 2024 period primarily due to lower tires and tolls costs.

Our supplies and maintenance expense decreased $866,000, or 5.3%, from the 2024 period, primarily due to lower tires, parts, tolls and loading/unloading costs.

Depreciation relates to owned tractors, trailers, containers, auxiliary power units, communication units, terminal facilities and other assets.

The $1.1 million, or 3.7%, decrease in depreciation in the 2025 period was primarily due to a decrease in our average tractor fleet size, partially offset by higher prices of new equipment.

The $899,000, or 3.2%, decrease in depreciation in the 2025 period was primarily due to a decrease in our average tractor and trailer fleet size, partially offset by higher prices of new equipment.

We expect our annual cost of tractor and trailer ownership will increase in future periods as a result of continued higher prices of new equipment, which will result in greater depreciation over the useful life.

1 unchanged sentence

These expenses will vary primarily based upon the frequency and severity of our accident experience, our self-insured retention levels and the market for insurance.

The $1.7 million, or 14.8%, increase in insurance and claims in the 2025 period was primarily due to increases in our self-insured auto liability claim costs and insurance premiums, partially offset by lower self-insured costs of physical damage claims related to our revenue equipment and workers’ compensation claims.

The $3.3 million, or 26.2%, increase in insurance and claims in the 2025 period was primarily due to increases in our self-insured auto liability claim costs and insurance premiums.

Our significant self-insured retention exposes us to the possibility of significant fluctuations in claims expense between periods which could materially impact our financial results depending on the frequency, severity and timing of claims.

Gain on disposition of revenue equipment increased to $1.7 million in the 2025 period from $1.2 million in the 2024 period due to an increase in the average gain for our tractor and trailer sales and a slight increase in the number of units sold.

Gain on disposition of revenue equipment increased to $5.2 million in the 2025 period from $2.5 million in the 2024 period due to increases in the average gain for our tractor and trailer sales and in the number of units sold.

Future gains or losses on dispositions of revenue equipment will be impacted by the market for used revenue equipment, which is beyond our control.

The $1.1 million, or 14.8%, increase in other operating expenses in the 2025 period was primarily due to an increase in legal costs.

The $454,000, or 5.6%, decrease in other operating expenses in the 2025 period was primarily due to a decrease in legal costs.

Our operating income declined 2.4% to $9.7 million in the 2025 period from $10.0 million in the 2024 period as a result of the foregoing factors.

4 unchanged sentences

As a result of the factors described above, net income declined 8.9% to $7.2 million, or $0.09 per diluted share, in the 2025 period from $7.9 million, or $0.10 per diluted share, in the 2024 period.

Comparison of Six Months Ended June 30, 2025 to Six Months Ended June 30, 2024

The following table sets forth for the periods indicated our operating revenue, operating income and operating ratio by segment, along with the change for each component:

(Dollars in thousands)

Operating revenue:

Truckload revenue, net of fuel surcharge revenue

Truckload fuel surcharge revenue

Total Truckload revenue

Dedicated revenue, net of fuel surcharge revenue

Dedicated fuel surcharge revenue

Total Dedicated revenue

Intermodal revenue, net of fuel surcharge revenue

Intermodal fuel surcharge revenue

Total Intermodal revenue

Brokerage revenue

Total operating revenue

Operating income/(loss):

Total operating income

Operating ratio:

Consolidated operating ratio

Operating ratio, net of fuel surcharges:

Consolidated operating ratio, net of fuel surcharges

Our operating revenue decreased $42.8 million, or 8.6%, to $453.1 million in the 2025 period from $495.9 million in the 2024 period.

Our operating revenue, net of fuel surcharges, decreased $29.7 million, or 6.9%, to $399.6 million in the 2025 period from $429.3 million in the 2024 period.

This decrease in the 2025 period was primarily due to a $15.4 million decrease in Dedicated revenue, net of fuel surcharges, an $8.5 million decrease in Truckload revenue, net of fuel surcharges, and a $5.6 million decrease in Intermodal revenue, net of fuel surcharges.

Fuel surcharge revenue decreased to $53.5 million in the 2025 period from $66.6 million in the 2024 period.

In addition to the factors discussed below, our profitability across each segment in the 2025 period was impacted by a freight market which has considerably softened from the conditions during the 2024 period.

Truckload segment revenue decreased $13.2 million, or 5.9%, to $210.9 million in the 2025 period from $224.1 million in the 2024 period.

Truckload segment revenue, net of fuel surcharges, decreased $8.5 million, or 4.4%, to $182.6 million in the 2025 period from $191.1 million in the 2024 period, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

The operating ratio improved to 99.0% in the 2025 period from 99.3% in the 2024 period.

Dedicated segment revenue decreased $22.2 million, or 13.3%, to $145.5 million in the 2025 period from $167.7 million in the 2024 period.

Dedicated segment revenue, net of fuel surcharges, decreased 11.1%, primarily due to a decrease in our average fleet size, partially offset by an increase in our average revenue per tractor.

The operating ratio increased to 92.9% in the 2025 period from 90.5% in the 2024 period.

Impacting the 2025 period operating ratio was higher insurance and claims and depreciation costs, as a percentage of revenue, partially offset by increased gain on disposition of revenue equipment.

Intermodal segment revenue decreased $7.2 million, or 23.3%, to $23.8 million in the 2025 period from $31.0 million in the 2024 period.

Intermodal segment revenue, net of fuel surcharges, decreased 21.5% from the 2024 period, primarily due to decreases in both our number of loads and our revenue per load.

The operating ratio in the 2025 period increased to 106.7% from 102.8% in the 2024 period.

Impacting the 2025 period operating ratio was the decrease in our revenue per load along with higher purchased transportation and depreciation costs, partially offset by lower company driver compensation, all as a percentage of revenue.

Brokerage segment revenue decreased $196,000, or 0.3%, to $72.9 million in the 2025 period from $73.1 million in the 2024 period, primarily due to a decrease in our revenue per load, partially offset by an increase in our number of loads.

The operating ratio in the 2025 period of 93.3% was up from 92.4% in the 2024 period.

Percentage of

Operating Revenue

(Dollars in thousands)

Operating revenue

Operating expenses (income):

Salaries, wages and benefits

Purchased transportation

Fuel and fuel taxes

Supplies and maintenance

Operating taxes and licenses

Insurance and claims

Communications and utilities

Gain on disposition of revenue equipment

Total operating expenses

Operating income

Income before income taxes

Income taxes expense

Salaries, wages and benefits expense decreased $17.9 million, or 10.2%, in the 2025 period from the 2024 period.

This decrease resulted primarily from reductions in company driver compensation expense of $13.0 million, non-driver compensation expense of $1.5 million and employees’ health insurance expense due to lower self-insured medical claims of $2.3 million.

Purchased transportation expense decreased $4.3 million in total, or 5.0%, in the 2025 period from the 2024 period.

Amounts payable to carriers for transportation services we arranged in our Brokerage segment increased $130,000 to $61.2 million in the 2025 period from $61.1 million in the 2024 period.

Amounts payable to railroads and drayage carriers for transportation services within our Intermodal segment decreased to $12.9 million in the 2025 period from $16.0 million in the 2024 period, primarily due to a decrease in the number of loads.

The portion of purchased transportation expense related to independent contractors within our Truckload and Dedicated segments, including fuel surcharges, decreased by $1.3 million in the 2025 period.

Fuel and fuel taxes decreased by $12.7 million, or 16.2%, in the 2025 period from the 2024 period.

Net fuel expense (fuel and fuel taxes net of fuel surcharge revenue and surcharges passed through to independent contractors, outside drayage carriers and railroads) decreased $1.2 million, or 6.8%, to $16.0 million in the 2025 period from $17.1 million in the 2024 period.

Fuel surcharges passed through to independent contractors, outside drayage carriers and railroads decreased to $3.8 million from $5.4 million in the 2024 period.

The DOE national average cost of fuel decreased to $3.59 per gallon from $3.91 per gallon in the 2024 period.

Despite this price decrease, our net fuel expense was up slightly to 4.9% of Truckload, Dedicated and Intermodal segment revenue, net of fuel surcharges, in the 2025 period from 4.8% in the 2024 period.

Our supplies and maintenance expense decreased $1.4 million, or 4.4%, from the 2024 period primarily due to lower tires, tolls and loading/unloading costs.

The $2.0 million, or 3.4%, decrease in depreciation in the 2025 period was primarily due to a decrease in our average tractor and trailer fleet size, partially offset by higher prices of new equipment.

The $5.0 million, or 20.7%, increase in insurance and claims in the 2025 period was primarily due to increases in our self-insured auto liability claim costs and insurance premiums, partially offset by lower self-insured costs of physical damage claims related to our revenue equipment and workers’ compensation claims.

Gain on disposition of revenue equipment increased to $6.8 million in the 2025 period from $3.7 million in the 2024 period due to increases in the average gain for our tractor and trailer sales and in the number of units sold.

The $619,000, or 4.0%, increase in other operating expenses in the 2025 period was primarily due to an increase in legal costs.

Our operating income declined 29.8% to $15.6 million in the 2025 period from $22.2 million in the 2024 period as a result of the foregoing factors.

Our operating expenses as a percentage of operating revenue, or “operating ratio,” was 96.6% in the 2025 period and 95.5% in the 2024 period.

The operating ratio for our Truckload segment was 99.0% in the 2025 period and 99.3% in the 2024 period, for our Dedicated segment was 92.9% in the 2025 period and 90.5% in the 2024 period, for our Intermodal segment was 106.7% in the 2025 period and 102.8% in the 2024 period, and for our Brokerage segment was 93.3% in the 2025 period and 92.4% in the 2024 period.

Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, was 96.1% in the 2025 period and 94.8% in the 2024 period.

Our effective income tax rate increased to 29.7% in the 2025 period from 27.0% in the 2024 period primarily due to increases in per diem and other non-deductible expenses as a percentage of projected earnings.

As a result of the factors described above, net income declined 34.3% to $11.5 million, or $0.14 per diluted share, in the 2025 period from $17.5 million, or $0.22 per diluted share, in the 2024 period.

Liquidity and Capital Resources

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The table below reflects our net cash flows provided by operating activities, net cash flows used for investing activities and net cash flows used for financing activities for the periods indicated.

Ended March 31,

Ended June 30,

(In thousands)

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On May 3, 2022, our Board of Directors approved and we announced an additional increase from current availability in our existing share repurchase program providing for the repurchase of up to $50.0 million, or approximately 3.1 million shares, of our common stock.

The share repurchase program allows purchases on the open market or through private transactions in accordance with Rule 10b-18 of the Exchange Act.

The share repurchase program allows purchases on the open market or through private transactions in accordance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended.

The timing and extent to which we repurchase shares depends on market conditions and other corporate considerations.

1 unchanged sentence

We repurchased and retired 1.3 million shares of common stock for $25.0 million in the first quarter of 2022, and 963,000 shares of common stock for $16.8 million in the second quarter of 2022.

We did not repurchase any shares in the first quarter of 2025, in 2024 or 2023, or in the third or fourth quarters of 2022.

As of March 31, 2025, future repurchases of up to $33.2 million, or approximately 2.2 million shares, were available in the share repurchase program.

In the first three months of 2024, net cash flows provided by operating activities of $45.7 million were primarily used to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $18.4 million, to pay cash dividends of $4.9 million and to construct and upgrade regional operating facilities in the amount of $1.6 million, resulting in a $20.5 million increase in cash and cash equivalents.

We did not repurchase any shares in the first six months of 2025, in 2024 or 2023, or in the third or fourth quarters of 2022.

As of June 30, 2025, future repurchases of up to $33.2 million, or approximately 2.2 million shares, were available in the share repurchase program.

In the first six months of 2024, net cash flows provided by operating activities of $81.5 million were primarily used to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $44.2 million, to pay cash dividends of $9.8 million and to construct and upgrade regional operating facilities in the amount of $3.3 million, resulting in a $24.0 million increase in cash and cash equivalents.

We estimate that capital expenditures, net of proceeds from dispositions, will be approximately $65 million for the remainder of 2025.

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Additionally, operating lease obligations total $698,000 through 2028.

Quarterly cash dividends of $0.06 per share of common stock were paid in each of the first quarters of 2025 and 2024 which totaled $4.9 million in each period.

Quarterly cash dividends of $0.06 per share of common stock were paid in each of the first two quarters of 2025 and 2024 which totaled $9.8 million in each period.

We currently expect to continue to pay quarterly cash dividends in the future.

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The credit agreement amends, restates and continues in its entirety our previous credit agreement, as amended.

At March 31, 2025, there was no outstanding principal balance on the facility.

At June 30, 2025, there was no outstanding principal balance on the facility.

As of that date, we had outstanding standby letters of credit to guarantee settlement of self-insurance claims of $22.4 million and remaining borrowing availability of $7.6 million.

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This facility bears interest at a variable rate based on the Term SOFR Rate plus applicable margins.

The interest rate for the facility that would apply to outstanding principal balances was 7.5% at March 31, 2025.

The interest rate for the facility that would apply to outstanding principal balances was 7.5% at June 30, 2025.

Our credit agreement effective in August 2022 prohibits us from paying, in any fiscal year, stock redemptions and dividends in excess of $150 million.

The current credit agreement also contains restrictive covenants which, among other matters, require us to maintain compliance with cash flow leverage and fixed charge coverage ratios.

We were in compliance with all covenants at March 31, 2025 and December 31, 2024.

Other than our obligations for revenue equipment and operating lease expenditures, along with our outstanding standby letters of credit to guarantee settlement of self-insurance claims, which are each mentioned above, we did not have any material off-balance sheet arrangements at March 31, 2025.

We were in compliance with all covenants at June 30, 2025 and December 31, 2024.

Our tractor productivity generally decreases during the winter season because inclement weather impedes operations and some shippers reduce their shipments.

4 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements