What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-05-09 compared with 2024-11-06 · 289 added, 280 removed, 331 unchanged (63% of the section changed)

Financial Statements.

TRANSPORTATION SERVICES, INC.

AND SUBSIDIARIES

PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

September 30,

Current assets:

5 unchanged sentences

Prepaid expenses and deposits

10,456 11,555

Marketable equity securities

24 unchanged sentences

15,067 14,569

Income tax payable

Current maturities of long-term debt

14 unchanged sentences

22,372,244 and 22,364,120 shares issued;

21,782,534 and 22,021,341 shares outstanding at September 30, 2024 and December 31, 2023, respectively

21,790,658 and 21,782,534 shares outstanding at March 31, 2025 and December 31, 2024, respectively

Additional paid-in capital

1 unchanged sentence

Treasury stock, at cost;

581,586 and 296,330 shares at September 30, 2024 and December 31, 2023, respectively

581,586 shares at March 31, 2025 and December 31, 2024, respectively

( 13,996 ) ( 13,996 )

6 unchanged sentences

See notes to condensed consolidated financial statements.

TRANSPORTATION SERVICES, INC.

AND SUBSIDIARIES

PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

1 unchanged sentence

Three Months Ended

September 30,

Nine Months Ended

September 30,

OPERATING REVENUES:

Revenue, before fuel surcharge

$ 136,701 $ 160,969

Fuel surcharge

18,641 21,623

Total operating revenues

155,342 182,592

OPERATING EXPENSES AND COSTS:

Salaries, wages and benefits

40,814 44,063

Operating supplies and expenses

31,385 34,712

Rent and purchased transportation

62,973 73,279

22,595 18,935

Insurance and claims

Gain on disposition of equipment

(Gain)/loss on sale or disposition of equipment

( 3,014 ) 240

Total operating expenses and costs

OPERATING INCOME

164,533 183,269

OPERATING LOSS

( 9,191 ) ( 677 )

NON-OPERATING INCOME

INTEREST EXPENSE

INCOME/(LOSS) BEFORE INCOME TAXES

FEDERAL AND STATE INCOME TAX EXPENSE/(BENEFIT):

Total federal and state income tax expense/(benefit)

NET INCOME/(LOSS)

INCOME/(LOSS) PER COMMON SHARE:

( 4,042 ) ( 2,883 )

(LOSS)/INCOME BEFORE INCOME TAXES

( 10,748 ) 378

FEDERAL AND STATE INCOME TAX (BENEFIT)/ EXPENSE:

( 11,304 ) ( 8 )

Total federal and state income tax (benefit)/expense

NET (LOSS)/INCOME

$ ( 8,142 ) $ 281

(LOSS)/INCOME PER COMMON SHARE:

$ ( 0.37 ) $ 0.01

AVERAGE COMMON SHARES OUTSTANDING:

21,787 22,031

21,787 22,127

See notes to condensed consolidated financial statements.

TRANSPORTATION SERVICES, INC.

AND SUBSIDIARIES

PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(in thousands)

Nine Months Ended

September 30,

Three Months Ended

OPERATING ACTIVITIES:

Net (loss)/income

$ ( 8,142 ) $ 281

Adjustments to reconcile net income to net cash provided by operating activities:

22,595 18,935

Bad debt expense

Stock compensation-net of excess tax benefits

Provision for deferred income taxes

(Gain)/loss on marketable equity securities

Gain on sale or disposition of equipment

Loss/(gain) on sale of marketable equity securities

Benefit for deferred income taxes

( 11,304 ) ( 8 )

Recognized (gain) on marketable equity securities

( 1,313 ) ( 2,586 )

(Gain)/loss on sale or disposition of equipment

( 3,014 ) 240

Changes in operating assets and liabilities:

Accounts receivable

( 4,572 ) ( 13,253 )

Prepaid expenses, deposits, inventories, and other assets

5 unchanged sentences

Purchases of property and equipment

( 11,801 ) ( 21,824 )

Sales of equity investments

Purchases of equity investments/return of capital

Proceeds from disposition of equipment

Sales of marketable equity securities

Net cash used in investing activities

13,812 12,022

Net cash provided (used) by investing activities

360 ( 9,802 )

FINANCING ACTIVITIES:

Borrowings under line of credit

152,333 207,854

Repayments under line of credit

Borrowings of long-term debt

( 152,333 ) ( 207,854 )

Repayments of long-term debt

Borrowings under margin account

Repayments under margin account

Repurchases of common stock

Net cash used in financing activities

NET (DECREASE)/INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

( 16,344 ) ( 20,431 )

Net cash used for financing activities

( 16,344 ) ( 20,431 )

NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

( 10,988 ) ( 20,648 )

CASH, CASH EQUIVALENTS AND RESTRICTED CASH -Beginning of period

68,060 100,614

CASH, CASH EQUIVALENTS AND RESTRICTED CASH -End of period

$ 57,072 $ 79,966

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

Cash paid during the period for:

$ 3,963 $ 2,933

NONCASH INVESTING AND FINANCING ACTIVITIES:

1 unchanged sentence

See notes to condensed consolidated financial statements.

TRANSPORTATION SERVICES, INC.

AND SUBSIDIARIES

PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands)

Shares / Amount

Paid-In Capital

Common Stock Additional Treasury Retained

Shares/Amount Paid-In Capital Stock Earnings Total

Balance at January 1, 2025 21,783 $ 224 $ 41,171 $ ( 13,996 ) $ 250,109 $ 277,508

Net loss - - - - ( 8,142 ) ( 8,142 )

Restricted stock issued 8 - ( 37 ) - - ( 37 )

1 unchanged sentence

Balance at March 31, 2025 21,791 $ 224 $ 41,400 $ ( 13,996 ) $ 241,967 $ 269,595

Treasury stock repurchases

Restricted stock issued

Stock based compensation

Balance at June 30, 2024

Treasury stock repurchases

Restricted stock issued

Restricted stock net settlement

Stock based compensation

Balance at September 30, 2024

Shares / Amount

Paid-In Capital

Common Stock Additional Treasury Retained

Shares/Amount Paid-In Capital Stock Earnings Total

Balance at January 1, 2024 22,021 $ 223 $ 40,825 $ ( 8,736 ) $ 281,904 $ 314,216

Treasury stock repurchases

Net loss - - - - 281 281

Restricted stock issued 14 - ( 46 ) - - ( 46 )

1 unchanged sentence

Balance at March 31, 2024 22,035 $ 223 $ 40,971 $ ( 8,736 ) $ 282,185 $ 314,643

Treasury stock repurchases

Restricted stock issued

Stock based compensation

Balance at June 30, 2023

Treasury stock repurchases

Restricted stock issued

Restricted stock net settlement

Stock based compensation

Balance at September 30, 2023

See notes to condensed consolidated financial statements.

TRANSPORTATION SERVICES, INC.

AND SUBSIDIARIES

PAMT CORP AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited)

September 30, 2024

March 31, 2025

BASIS OF PRESENTATION

Transportation Services, Inc.

and its legally distinct subsidiaries, unless otherwise indicated, is presented on a consolidated basis.

Unless the context otherwise requires, all references in this Quarterly Report on Form 10 -Q to “P.A.M.,” the “Company,” “we,” “our,” or “us” mean P.A.M.

Transportation Services, Inc.

and its consolidated subsidiaries.

In accordance with generally accepted accounting principles (“GAAP”) and applicable rules of the Securities and Exchange Commission, the information reported in this Quarterly Report on Form 10 -Q for PAMT CORP and its legally distinct subsidiaries, unless otherwise indicated, is presented on a consolidated basis.

Unless the context otherwise requires, all references in this Quarterly Report on Form 10 -Q to the “Company,” “we,” “our,” or “us” mean PAMT CORP and its consolidated subsidiaries.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10 -Q and Article 10 of Regulation S- X.

2 unchanged sentences

The consolidated balance sheet at December 31, 2024 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

Operating results for the nine -month period ended September 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

Operating results for the three -month period ended March 31, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

For further information, refer to the consolidated financial statements and the footnotes thereto included in the Company’s annual report on Form 10 -K for the year ended December 31, 2024.

3 unchanged sentences

This ASU is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, using a retrospective approach.

Early adoption is permitted.

We are currently evaluating the impact of the new standard, which is limited to financial statement disclosures.

In December 2023, the FASB issued Accounting Standards Update, (“ASU”) No.

2023 - 09, (“ASU 2023 - 09” ), Improvements to Income Tax Disclosures.

The Company adopted this standard on a retrospective basis for the 2024 annual period, and for interim periods beginning January 1, 2025.

See Note F, “Segment Information,” for further information.

ASU 2023 - 07 had no material impact on the Company’s financial condition, results of operations, or cash flows.

In December 2023, the FASB issued ASU 2023 - 09, Improvements to Income Tax Disclosures.

ASU 2023 - 09 was issued to enhance the transparency and decision usefulness of income tax disclosures primarily related to the rate reconciliation and income taxes paid information.

1 unchanged sentence

The Company has evaluated the new guidance and does not expect it to have a material impact on its financial condition, results of operations, or cash flows.

The Company considered the applicability and impact of ASU’s 2023 - 07, 2023 - 09 and all other accounting standard updates issued by the Financial Accounting Standards Board to the Accounting Standards Codification ("ASC") and determined there are not any ASUs that have not already been adopted which require significant consideration for disclosure as of September 30, 2024.

Additionally, the Company did not adopt any new ASUs during the quarter ended September 30, 2024.

In November 2024, the FASB issued ASU 2024 - 03, Disaggregation of Income Statement Expenses.

ASU 2024 - 03 was issued to enhance the transparency of financial reporting by requiring public business entities to provide more detailed disclosures about certain operating expenses.

The guidance is effective for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.

Early adoption is permitted.

The Company has evaluated the new guidance and does not expect it to have a material impact on its financial condition, results of operations, or cash flows.

REVENUE RECOGNITION

The Company has a single performance obligation, which is to transport our customer’s freight from a specified origin to a specified destination.

The Company has a single performance obligation, to transport our customers' freight from a specified origin to a specified destination.

The Company has the discretion to choose to self-transport or to arrange for alternate transportation to fulfill the performance obligation.

6 unchanged sentences

In addition to transportation, revenue is also awarded for various accessorial services performed in conjunction with the base transportation service.

The Company also has other revenue categories that are not discussed in this note or broken out in our condensed consolidated statements of operations due to their immaterial amounts.

In fulfilling the Company’s obligation to transport freight from a specified origin to a specified destination, control of freight is transferred to us at the point it has been loaded into the driver’s trailer, the doors are sealed and the driver has signed a bill of lading, which is the basic transportation agreement that establishes the nature, quantity and condition of the freight loaded, the responsibility for invoice payment and the pickup and delivery locations.

Our revenue is generated, and our customers receive benefit, as the freight progresses towards delivery locations.

In the event our customer cancels the shipment at some point prior to the final delivery location and re-consigns the shipment to an alternate delivery location, we are entitled to receive payment for services performed for the partial shipment.

The Company also has other revenue categories that are not discussed in this note or broken out in our consolidated statements of operations due to their immaterial amounts.

In fulfilling the Company’s obligation to transport freight from a specified origin to a specified destination, the control of freight is transferred to the Company at the point it has been loaded into the driver’s trailer, the doors are sealed and the driver has signed a bill of lading, which is the basic transportation agreement that establishes the nature, quantity and condition of the freight loaded, responsibility for invoice payment, and pickup and delivery locations.

The Company’s revenue is generated, and our customer receives benefit, as the freight progresses towards delivery locations.

In the event the Company’s customer cancels the shipment at some point prior to the final delivery location and re-consigns the shipment to an alternate delivery location, the Company is entitled to receive payment for services performed for the partial shipment.

Shipments are generally conducted over a relatively short time span, generally one to three days;

however, freight is sometimes stored temporarily in our trailer at one of our drop yard locations or at a location designated by a customer.

Our revenue is categorized as either Freight Revenue or Fuel Surcharge Revenue, and both are earned by performing the same freight transportation services, as discussed further below.

The Company’s revenue is categorized as either Freight Revenue or Fuel Surcharge Revenue, and both are earned by performing the same freight transportation services, as discussed further below.

Freight Revenue – revenue generated by the performance of the freight transportation service, including any accessorial service, provided to customers.

1 unchanged sentence

Diesel fuel prices can fluctuate widely during the term of a contract with a customer.

At the point that freight revenue rates are negotiated with customers, a sliding scale is agreed upon that approximately adjusts diesel fuel costs to an agreed-upon base amount.

In general, as fuel prices increase, revenue from fuel surcharge increases, so that diesel fuel cost is adjusted to the approximate base amount agreed upon.

At the point that freight revenue rates are negotiated with customers, a sliding scale is agreed upon that systematically adjusts diesel fuel costs to an agreed-upon base amount.

In general, as fuel prices increase, revenue from fuel surcharge increases, so that diesel fuel cost is adjusted to the approximate agreed upon base amount.

Revenue is recognized over time as the freight progresses towards its destination and the transportation service obligation is fulfilled.

For loads picked up during the reporting period, but delivered in a subsequent reporting period, revenue is allocated to each period based on the transit time in each period as a percentage of total transit time.

There are no assets or liabilities recorded in conjunction with revenue recognized, other than accounts receivable and estimated credit losses.

The contract asset, or the amount of remaining performance obligation relating to loads in process, at March 31, 2025 was $ 3.1 million compared to $ 2.3 million at December 31, 2024.

Recorded contract assets are included in the accounts receivable line item of the balance sheet.

Corresponding liabilities are recorded in the accrued expenses and other liabilities line items for the estimated expenses on these same in-process loads.

The Company had no contract liabilities associated with our operations as of March 31, 2025 and December 31, 2024, respectively.

The Company recognizes operating lease revenue from leasing tractors and related equipment to third parties, including independent contractors.

Operating lease revenue from rental operations is recognized in revenue as it is earned.

Upon lease termination, losses may be incurred in the recovery of leased equipment which are recognized as an expense in the period in which they are incurred.

MARKETABLE EQUITY SECURITIES

The Company’s investments in marketable securities consist of equity securities with readily determinable fair values.

The cost of securities sold is based on the specific identification method, and interest and dividends on securities are included in non-operating income.

The cost of securities sold is based on the specific identification method, and interest and dividends on securities are included in non-operating income (expense).

Marketable equity securities are carried at fair value, with gains and losses in fair market value included in the determination of net income.

The fair value of marketable equity securities is determined based on quoted market prices in active markets, as described in Note J.

The following table sets forth market value, cost, and unrealized gains on equity securities as of September 30, 2024 and December 31, 2023.

September 30, 2024

The following table sets forth market value, cost, and unrealized gains on equity securities as of March 31, 2025 and December 31, 2024.

March 31, 2025

December 31, 2024

1 unchanged sentence

Fair market value

$ 45,584 $ 42,620

28,742 27,094

Unrealized gain

The following table sets forth the gross unrealized gains and losses on the Company’s marketable securities as of September 30, 2024 and December 31, 2023.

September 30, 2024

$ 16,842 $ 15,526

The following table sets forth the gross unrealized gains and losses on the Company’s marketable securities as of March 31, 2025 and December 31, 2024.

March 31, 2025

December 31, 2024

1 unchanged sentence

Gross unrealized gains

$ 18,717 $ 17,215

Gross unrealized losses

Net unrealized gain

The following table shows the Company’s net realized gains during the three and nine months ending on September 30, 2024 and 2023, respectively, on certain marketable equity securities.

$ 16,842 $ 15,526

The following table shows the Company’s net realized gains during the three months ending on March 31, 2025 and 2024, respectively, on certain marketable equity securities.

Three Months Ended

Nine Months Ended

September 30,

March 31, 2025

December 31, 2024

(in thousands)

Sales Proceeds

Cost of securities sold

Realized gain/(loss)

For the quarter ended September 30, 2024, the Company recognized dividend income of approximately $ 356,000 in non-operating income in its condensed consolidated statements of operations.

For the nine months ended September 30, 2024, the Company recognized dividend income of approximately $ 1,104,000 in non-operating income in its condensed consolidated statements of operations.

Gross unrealized losses

Net unrealized gain

For the quarter ended March 31, 2025, the Company recognized dividends received of approximately $ 443,000 in non-operating income in its condensed consolidated statements of operations.

For the quarter ended March 31, 2024, the Company recognized dividends received of approximately $ 349,000 in non-operating income in its condensed consolidated statements of operations.

The Company’s equity securities are periodically used as collateral against any outstanding margin account borrowings.

As of September 30, 2024, the Company had no outstanding borrowings under its margin account, which is no change from December 31, 2023, when the Company had no outstanding borrowings under the same account.

Margin account borrowings are used for the purchase of marketable equity securities and as a source of short-term liquidity and are included in accrued expenses and other liabilities on our condensed consolidated balance sheets.

Our marketable equity securities portfolio had a net unrealized pre-tax gain in market value of approximately $ 2,365,000 during the third quarter of 2024, and a net unrealized pre-tax gain in market value of approximately $ 119,000 during the third quarter of 2023, which were reported as non-operating income in its condensed consolidated statements of operations for the respective periods.

As of March 31, 2025, the Company had no outstanding borrowings under its margin account, which is no change from December 31, 2024, when the Company had no outstanding borrowings under the same account.

Margin account borrowings, when utilized, are used for the purchase of marketable equity securities and as a source of short-term liquidity and are included in accrued expenses and other liabilities on our condensed consolidated balance sheets.

Our marketable equity securities portfolio had a net unrealized pre-tax gain in market value of approximately $ 1,316,000 during the first quarter of 2025, and a net unrealized pre-tax gain in market value of approximately $ 2,586,000 during the first quarter of 2024, which were reported as non-operating income in its condensed consolidated statements of operations for the respective periods.

STOCK-BASED COMPENSATION

The Company has maintained a stock incentive plan (the “Plan”) under which incentive and nonqualified stock options and other stock awards may be granted.

Under the Plan, 3,000,000 shares were reserved for the issuance of stock awards to directors, officers, key employees, and others.

The stock option exercise price and the restricted stock value under the Plan shall not be less than 85 % of the fair market value of the Company’s common stock on the date the award is granted.

The fair market value is determined by the closing price of the Company’s common stock, on its primary exchange, on the same date that the option or award is granted.

This Plan expired on March 13, 2024, and no further grants may be made under the Plan.

The Company maintains a stock incentive plan under which incentive and nonqualified stock options and other stock awards may be granted.

On February 15, 2024, the Company’s Board of Directors adopted, and on October 31, 2024, our shareholders approved, the 2024 Equity Incentive Plan, as amended (the “2024 Plan”).

Under the 2024 Plan, 1,600,000 shares are reserved for the issuance of stock awards to employees, officers, directors, consultants and advisors of the Company.

The stock option exercise price and the restricted stock unit purchase price under the 2024 Plan shall not be less than 100 % of the fair market value of the Company’s common stock on the date the award is granted.

The fair market value is determined by the closing price of the Company’s common stock, on its primary exchange, on the same date that the option or other award is granted.

During January 2025, the Company granted awards of restricted stock units representing 100,000 shares of common stock to certain key employees under the 2024 Plan.

These stock awards had grant date fair values of $ 16.10 per share, based on the closing price of the Company’s stock on the date of grant.

52,500 of the awarded share units vest on the four -year anniversary date of the award.

The remaining 47,500 of the awarded share units vest on the five -year anniversary date of the award.

Prior to the 2024 Plan, the Company maintained the 2014 Amended and Restated Stock Option and Incentive Plan (the “2014 Plan”), which was adopted by the Company’s Board of Directors in March 2014 and approved by the Company’s shareholders in May 2014.

Under the 2014 Plan, 3,000,000 shares (as adjusted for the Company’s 2 -for- 1 forward splits of its common stock paid in August 2021 and March 2022, respectively) were reserved for the issuance of stock awards to directors, officers, key employees, and others.

The stock option exercise price and the restricted stock purchase price under the 2014 Plan was not to be less than 85 % of the fair market value of the Company’s common stock on the date the award is granted.

The fair market value was determined by the closing price of the Company’s common stock, on its primary exchange, on the same date that the option or award was granted.

The 2014 Plan expired on March 13, 2024, and no further grants may be made under this plan.

All outstanding unvested awards granted under the 2014 Plan, however, remain subject to the terms and conditions of the 2014 Plan.

On February 15, 2024, the Company’s Board of Directors adopted a new 2024 Equity Incentive Plan (the “2024 Plan”), under which 1,600,000 shares are reserved for issuance of stock awards to employees, officers, directors, consultants and advisors of the Company.

The 2024 Plan is subject to and will become effective upon approval by the Company’s shareholders at its upcoming annual meeting of shareholders.

During May 2024, the Company issued 2,130 unrestricted shares of common stock to non-employee directors.

These shares had a grant date fair value of $ 17.60 per share, based on the closing price of the Company’s stock on the date of issuance.

The total grant date fair value of stock vested during the first nine months of 2024 was approximately $ 928,000 .

The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first nine months of 2024, was approximately $ 550,000 and includes approximately $ 38,000 recognized as a result of the issuance of shares to certain non-employee directors.

The recognition of stock-based compensation expense decreased both diluted and basic earnings per common share by approximately $ 0.02 during the first nine months of 2024.

As of September 30, 2024, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $ 1,536,000 , which is being amortized on a straight-line basis over the remaining vesting period.

As a result, the Company expects to recognize approximately $ 186,000 in additional compensation expense related to unvested stock awards during the remainder of 2024 and to recognize approximately $ 741,000 , $ 476,000 , and $ 133,000 in additional compensation expense related to unvested stock awards during the years 2025, 2026, and 2027, respectively.

The total grant date fair value of stock vested during the first nine months of 2023 was approximately $ 576,000 .

The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first nine months of 2023, was approximately $ 387,000 and includes approximately $ 55,000 recognized as a result of the grant of shares to certain non-employee directors.

The recognition of stock-based compensation expense decreased both diluted and basic earnings per common share by approximately $ 0.01 during the first nine months of 2023.

As of September 30, 2023, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $ 2,687,000 , which was being amortized on a straight-line basis over the remaining vesting period.

A summary of the status of the Company’s non-vested restricted stock as of September 30, 2024, and changes during the nine months ended September 30, 2024, is as follows:

Restricted Stock

The total grant date fair value of stock vested during the first three months of 2025 was approximately $ 354,000 .

The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first three months of 2025, was approximately $ 266,000 .

The recognition of stock-based compensation expense decreased both diluted and basic earnings per common share by approximately $ 0.01 during the first three months of 2025.

As of March 31, 2025, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $ 2,659,000 , which is being amortized on a straight-line basis over the remaining vesting period.

As a result, the Company expects to recognize approximately $ 785,000 in additional compensation expense related to unvested stock awards during the remainder of 2025 and to recognize approximately $ 829,000 , $ 498,000 , and $ 364,000 in additional compensation expense related to unvested stock-based awards during the years 2026, 2027, and 2028, respectively.

The total grant date fair value of stock vested during the first three months of 2024 was approximately $ 450,000 .

The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first three months of 2024, was approximately $ 192,000 .

The recognition of stock-based compensation expense decreased both diluted and basic earnings per common share by approximately $ 0.01 during the first three months of 2024.

As of March 31, 2024, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $ 1,942,000 , which was being amortized on a straight-line basis over the remaining vesting period.

A summary of the status of the Company’s non-vested stock-based awards as of March 31, 2025, and changes during the three months ended March 31, 2025, is as follows:

Stock-Based Awards

Number of Shares/Units

Average Grant

1 unchanged sentence

Non-vested at January 1, 2025

128,591 $ 13.79

100,000 16.10

Canceled/forfeited/expired

Non-vested at September 30, 2024

( 10,500 ) 33.70

Non-vested at March 31, 2025

218,091 $ 13.89

SEGMENT INFORMATION

1 unchanged sentence

The Company has determined that it has a total of two operating segments whose primary operations can be characterized as either Truckload Services or Brokerage and Logistics Services;

however, in accordance with the aggregation criteria provided by FASB ASC Topic 280, the Company has determined that the operations of the two operating segments have similar economic characteristics and can be aggregated into a single reportable segment, Motor Carrier Operations.

however, in accordance with the aggregation criteria provided by FASB ASC Topic 280, the Company has determined that the operations of the two operating segments can be aggregated into a single reportable segment.

Both our truckload operations and our brokerage/logistics operations have similar qualitative and quantitative economic characteristics and are impacted by virtually the same economic factors.

Based on the Company’s segment identification, interpretation of the aggregation criteria outlined in ASC 280 - 10 - 50 - 11, and the similar qualitative and quantitative economic characteristics of the Company’s operating segments, the operations of the Company are aggregated into a single motor carrier segment.

The Company’s chief operating decision maker, the Chief Executive Officer, utilizes the metrics of net income and operating ratio to evaluate company performance and in competitive analysis when comparing to competing companies.

Truckload Services revenues and Brokerage and Logistics Services revenues, each before fuel surcharges, were as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

Three Months Ended March 31,

(in thousands, except percentage data)

Truckload Services revenue

$ 92,429 67.6 $ 102,200 63.5

Brokerage and Logistics Services revenue

44,272 32.4 58,769 36.5

Total revenues

$ 136,701 100.0 $ 160,969 100.0

The Company provides truckload transportation services as well as brokerage and logistics services to customers throughout the United States and portions of Canada and Mexico.

The table below presents revenue dollars and percentages by geographic area:

Quarter Ended March 31,

(in thousands)

United States - domestic shipments

$ 83,917 54.0 $ 118,909 65.1

Shipments to or from Mexico

71,025 45.7 63,381 34.7

Shipments to or from Canada

400 0.3 302 0.2

$ 155,342 100 % $ 182,592 100 %

TREASURY STOCK

The Company’s stock repurchase program has been extended and expanded several times, most recently in July 2023, when the Board of Directors reauthorized 500,000 shares of common stock for repurchase under the initial September 2011 authorization.

During the nine months ended September 30, 2024, the Company repurchased 1,050 shares of its common stock at an aggregate cost of approximately $ 17,000 under this program.

As of September 30, 2024, there remain 474,016 shares of common stock authorized for repurchase under this plan.

On April 24, 2024, the Company commenced a tender offer to repurchase up to 550,000 shares of the Company’s outstanding common stock at a price of not greater than $ 18.00 nor less than $ 15.50 per share.

Following the expiration of the tender offer on May 22, 2024, the Company accepted 284,206 shares of its common stock for purchase at $ 18.00 per share, at an aggregate purchase price of approximately $ 5.1 million, excluding fees and expenses related to the offer.

The Company funded the purchase of the accepted shares tendered with available cash and accounted for the repurchase of these shares as treasury stock on the Company’s condensed consolidated balance sheet as of September 30, 2024.

As of March 31, 2025, there remain 474,016 shares of common stock authorized for repurchase under this plan.

The Company accounts for treasury stock using the cost method.

As of September 30, 2024, 581,586 shares were held in the treasury at an aggregate cost of approximately $ 13,996,000 .

As of March 31, 2025, 581,586 shares were held in the treasury at an aggregate cost of approximately $ 13,996,000 .

EARNINGS PER SHARE

4 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

(in thousands, except per share data)

Net (loss)/income

$ ( 8,142 ) $ 281

Basic weighted average common shares outstanding

21,787 22,031

Dilutive effect of common stock equivalents

Diluted weighted average common shares outstanding

Basic earnings per share

Diluted earnings per share

21,787 22,127

Basic (loss)/earnings per share

$ ( 0.37 ) $ 0.01

Diluted (loss)/earnings per share

$ ( 0.37 ) $ 0.01

The Company and its subsidiaries are subject to U.S.

3 unchanged sentences

If negative conditions exist which indicate a valuation allowance might be necessary, consideration is then given to what effect the future reversals of existing taxable temporary differences and the availability of tax strategies might have on future taxable income to determine the amount, if any, of the required valuation allowance.

As of September 30, 2024, management determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

As of March 31, 2025, management determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the position will be sustained on examination by taxing authorities, based on the technical merits of the position.

As of September 30, 2024, an adjustment to the Company’s condensed consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws.

As of March 31, 2025, an adjustment to the Company’s condensed consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws.

The Company recognizes interest and penalties related to uncertain income tax positions, if any, in income tax expense.

During the nine months ended September 30, 2024 and 2023, the Company has not recognized or accrued any interest or penalties related to uncertain income tax positions.

The Company’s effective income tax rates were 23.8 % and 27.0 % for the nine months ended September 30, 2024 and 2023, respectively.

Our effective tax rate for the nine months ended September 30, 2024 differs from amounts computed by applying the United States federal statutory rates to pre-tax income primarily due to state income taxes.

During the three months ended March 31, 2025 and 2024, the Company has not recognized or accrued any interest or penalties related to uncertain income tax positions.

The Company’s effective income tax rates were 24.2 % and 25.7 % for the three months ended March 31, 2025 and 2024, respectively.

Our effective tax rate for the three months ended March 31, 2025 differs from amounts computed by applying the United States federal statutory rates to pre-tax income primarily due to state income taxes.

FAIR VALUE OF FINANCIAL INSTRUMENTS

11 unchanged sentences

The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

At September 30, 2024, the following items are measured at fair value on a recurring basis:

At March 31, 2025, the following items are measured at fair value on a recurring basis:

(in thousands)

Marketable equity securities

$ 45,584 $ 45,584 - -

The Company’s investments in marketable securities are recorded at fair value based on quoted market prices.

2 unchanged sentences

For long-term debt other than the lines of credit, the fair values are estimated using discounted cash flow analyses, based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements.

The carrying value and estimated fair value of this other long-term debt at September 30, 2024 was as follows:

The carrying value and estimated fair value of this other long-term debt at March 31, 2025 was as follows:

(in thousands)

Long-term debt

$ 309,238 $ 303,683

The Company has not elected the fair value option for any of its financial instruments.

NOTES PAYABLE

During the first nine months of 2024, the Company’s subsidiaries entered into installment obligations totaling approximately $ 75.0 million for the purpose of purchasing revenue equipment and other assets.

These obligations are payable in monthly installments and are recorded in long-term debt and current maturities on the condensed consolidated balance sheets.

The terms of these obligations range from 60 to 84 months.

During the first three months of 2025, the Company’s subsidiaries did not enter into any new installment obligations.

We are involved in certain claims and pending litigation arising from the ordinary conduct of business.

We also provide accruals for claims within our self-insured retention amounts.

We are currently self-insured for certain layers of auto liability claims in excess of $ 2.0 million.

Therefore, we specifically reserve for claims that are expected to exceed $ 2.0 million when fully developed, based on the facts and circumstances of those claims.

If we experience claims that are not covered by our insurance or that exceed our estimated claim reserve, it could increase the volatility of our earnings and have a materially adverse effect on our financial condition, results of operations or cash flows.

Since September 1, 2020, we have been self-insured for certain layers of auto liability claims in excess of $ 2.0 million.

We currently specifically reserve for claims that are expected to exceed $ 2.0 million when fully developed, based on the facts and circumstances of those claims.

Based on our knowledge of the facts, and in certain cases, opinions of outside counsel, we believe the resolution of such claims and pending litigation will not have a material effect on our financial position, results of operations or cash flows.

However, if we experience claims that are not covered by our insurance or that exceed our estimated claim reserve, it could increase the volatility of our earnings and have a materially adverse effect on our financial condition, results of operations or cash flows.

The Company currently leases shop, office and parking spaces in various locations in the United States and Mexico.

9 unchanged sentences

Right-of-Use Leases

The Company is party to operating leases that included initial terms ranging from three to five years.

The Company is party to operating leases that include initial terms ranging from three to five years.

The initial terms of these leases have expired, and the leases are now subject to terms not exceeding one year.

In accordance with the provisions of ASC Topic 842, because all of our leased properties are currently subject to leases not exceeding one year, we do not recognize any right-of-use assets or corresponding operating lease liability as of September 30, 2024.

No new right-of-use asset was recognized as a non-cash asset addition that resulted from new operating lease liabilities during the nine months ended September 30, 2024.

Cash paid for amounts included in the present value of operating lease liabilities was $ 0.1 million during the nine months ended September 30, 2024, and is included in operating cash flows within the condensed consolidated statement of cash flows.

No new right-of-use assets were recognized as a non-cash asset addition that resulted from new operating lease liabilities during the three months ended March 31, 2025.

No cash payments were made for amounts included in the present value of operating lease liabilities during the three months ended March 31, 2025.

Operating Lease Costs

Three Months Ended

Nine Months Ended

September 30,

(in thousands)

$ - $ 83 $ 114 $ 246

927 831 2,608 2,327

$ 927 $ 914 $ 2,722 $ 2,573

Lease Revenue

1 unchanged sentence

Three Months Ended

Nine Months Ended

September 30,

(in thousands)

1 unchanged sentence

$ 2,605 $ 1,991

Leased building space revenue (recorded in non-operating income)

121 99 360 296

Leased facility space revenue (recorded in non-operating income)

Total lease revenue

$ 2,808 $ 2,119

The Company leases trucks to owner-operators under operating leases, which generally have a term of up to five years and include options to purchase the truck at the end of the lease.

In the event that an independent contractor defaults on their lease, the Company generally leases the truck to another independent contractor.

As of September 30, 2024, the gross carrying value of trucks underlying these leases was $ 66.6 million and accumulated depreciation was $ 28.7 million.

The Company has a lease-purchase program whereby we offer independent contractors the opportunity to lease a Company-owned truck.

The terms associated with these leases require weekly lease payments over the terms of the leases, which range from 5 to 60 months.

Payments under this program are classified in the Company’s financial statements under the consolidated statement of operations category Revenue.

As of March 31, 2025, the gross carrying value of trucks underlying these leases was $ 67.8 million and accumulated depreciation was $ 31.7 million.

Depreciation is calculated on a straight-line basis over the estimated useful life of the equipment, down to an estimated salvage value.

1 unchanged sentence

In other cases, where salvage values are not guaranteed, estimates of salvage value are based on the expected market values of equipment at the time of disposal.

During the quarter ended September 30, 2024, the Company incurred $ 2.0 million of depreciation expense for these assets.

During the quarter ended March 31, 2025, the Company incurred $ 2.5 million of depreciation expense for these assets.

The Company leases dock space to a related party at our Laredo, Texas, terminal.

2 unchanged sentences

Lease Receivables

Future minimum operating lease payments receivable at September 30, 2024:

Future minimum operating lease payments receivable at March 31, 2025:

(in thousands)

3 unchanged sentences

NONCASH INVESTING AND FINANCING ACTIVITIES

The Company financed approximately $ 75.0 million in equipment purchases during the first nine months of 2024 utilizing noncash financing.

The Company did not finance any equipment purchases during the first three months of 2025 utilizing noncash financing.

SUBSEQUENT EVENTS

On April 3, 2025, the Company commenced a tender offer to repurchase up to 435,000 shares of the Company’s outstanding common stock at a price of not greater than $ 17.00 nor less than $ 14.00 per share.

On April 11, 2025, the Company amended the terms of the tender offer to increase the minimum purchase price for shares purchased in the tender offer to $ 14.50 per share.

Following the expiration of the tender offer on May 1, 2025, the Company accepted 870,000 shares of its common stock for purchase at $ 17.00 per share, at an aggregate purchase price of approximately $ 14.8 million, excluding fees and expenses related to the offer.

The number of shares purchased by the Company reflects the Company's right to purchase additional shares in the tender offer up to an additional 2 % of its outstanding shares.

The Company funded the purchase of the accepted shares tendered with available cash and will account for the repurchase of these shares as treasury stock on the Company’s condensed consolidated balance sheet as of June 30, 2025.

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

5 unchanged sentences

surplus inventories;

recessionary economic cycles and downturns in customers’ business cycles;

increases or rapid fluctuations in fuel prices, inflation, interest rates, fuel taxes, tolls, and license and registration fees;

potential economic, business or operational disruptions or uncertainties due to public health crises;

general inflation, recessionary economic cycles and downturns in customers' business cycles;

a significant reduction in or termination of the Company's trucking service by a key customer, including as a result of recent or future labor or international trade disruptions;

increases or rapid fluctuations in fuel prices, interest rates, fuel taxes, tolls, and license and registration fees;

potential economic, business or operational disruptions or uncertainties that may result from any future public health crises;

the resale value of the Company's used equipment;

the price and availability of new equipment consistent with anticipated acquisition and replacement plans;

the price and availability of new equipment consistent with anticipated acquisitions and replacement plans;

increases in compensation for and difficulty in attracting and retaining qualified drivers and owner-operators;

8 unchanged sentences

general risks associated with doing business in Mexico, including, without limitation, exchange rate fluctuations, inflation, import duties, tariffs, quotas, political and economic instability and terrorism;

the potential impact of new laws, regulations or policy, including, without limitation, laws and regulations governing the classification of independent contractors as employees, tariffs, import/export, trade and immigration regulations or policies;

a significant reduction in or termination of the Company’s trucking service by a key customer;

the potential impact of new laws, regulations or policy, including, without limitation, rules regarding the classification of independent contractors as employees, tariffs, import/export, trade and immigration regulations or policies;

and other factors, including risk factors, included from time to time in filings made by the Company with the Securities and Exchange Commission.

The Company undertakes no obligation to publicly update or revise forward-looking statements, whether as a result of new information, future events or otherwise.

In light of these risks and uncertainties, the forward-looking events and circumstances discussed above and in company filings might not transpire.

The Company undertakes no obligation to publicly update or revise forward-looking statements, whether due to new information, future events or otherwise.

Considering these risks and uncertainties, the forward-looking events and circumstances discussed above and in company filings might not transpire.

CRITICAL ACCOUNTING ESTIMATES

1 unchanged sentence

BUSINESS OVERVIEW

The Company is a holding company that owns subsidiaries engaged in providing truckload dry van carrier services transporting general commodities throughout the continental United States, as well as in the Canadian provinces of Ontario and Quebec.

The Company’s consolidated operating subsidiaries also provide transportation services in Mexico through its gateways in Laredo and El Paso, Texas under agreements with Mexican carriers.

5 unchanged sentences

Truckload services are performed by Company divisions that generally utilize Company-owned trucks, long-term contractors, or single-trip contractors to transport loads of freight for customers, while brokerage and logistics services coordinate or facilitate the transport of loads of freight for customers and generally involve the utilization of single-trip contractors.

Both our truckload operations and our brokerage and logistics operations have similar economic characteristics and are impacted by virtually the same economic factors as discussed elsewhere in this report.

For both operations, substantially all of our revenue is generated by transporting freight for customers and is predominantly affected by the rates per mile received from our customers, equipment utilization, and our percentage of non-compensated miles.

These aspects of our business are carefully managed, and efforts are continuously underway to achieve favorable results.

Truckload services revenues, excluding fuel surcharges, represented 68.8% and 64.4% of total revenues, excluding fuel surcharges, for the quarters ended September 30, 2024, and 2023, respectively.

The remaining revenues, excluding fuel surcharges, were generated from brokerage and logistics services.

The operations of the Company and its subsidiaries are all in the motor carrier segment and are aggregated into a single reporting segment in accordance with the aggregation criteria under Generally Accepted Accounting Principles (“GAAP”).

The Company has carefully considered the segment reporting requirements under Accounting Standards Codification (“ASC”) 280 and has determined that both our truckload operations and our brokerage/logistics operations have similar qualitative and quantitative economic characteristics and are impacted by virtually the same economic factors, such as rates per mile, equipment utilization and the percentage of non-compensated miles.

Based on the Company’s segment identification, interpretation of the aggregation criteria outlined in ASC 280-10-50-11, and the similar qualitative and quantitative economic characteristics of the Company’s operating segments, the operations of the Company is aggregated into a single motor carrier segment.

Truckload services revenues, excluding fuel surcharges, represented 67.6% and 63.5% of total revenues, excluding fuel surcharges, for the quarters ended March 31, 2025, and 2024, respectively.

The remaining operating revenues, before fuel surcharges, for the same periods were generated from brokerage and logistics services, representing 32.4% and 36.5%, respectively.

The main factors that impact our profitability on the expense side are costs incurred in transporting freight for our customers.

Currently, our most challenging costs include fuel, driver recruitment, training, wage and benefits costs, independent broker costs (which we record as purchased transportation), insurance, maintenance and capital equipment costs.

In discussing our results of operations, we use revenue before fuel surcharge (and fuel expense, net of fuel surcharge), because management believes that eliminating the impact of this often-volatile source of revenue allows a more consistent basis for comparing our results of operations from period to period.

During the three months ended September 30, 2024 and 2023, approximately $21.8 million and $27.2 million, respectively, of the Company’s total revenue was generated from fuel surcharges.

During the nine months ended September 30, 2024 and 2023, approximately $66.1 million and $80.8 million, respectively, of the Company’s total revenue was generated from fuel surcharges.

In discussing our results of operations, we use revenue, before fuel surcharge (and fuel expense, net of fuel surcharge), because management believes that eliminating the impact of this sometimes volatile source of revenue allows a more consistent basis for comparing our results of operations from period to period.

During the three months ended March 31, 2025 and 2024, approximately $18.6 million and $21.6 million, respectively, of the Company’s total revenue was generated from fuel surcharges.

We may also discuss certain changes in our expenses as a percentage of revenue, before fuel surcharge, rather than absolute dollar changes.

4 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

(percentages)

5 unchanged sentences

Insurance and claims

Gain on sale or disposal of property

(Gain) loss on sale or disposal of property

Total operating expenses

Operating (loss)/income

Operating Loss

Non-operating income

Interest expense

Income/(loss) before income taxes

THREE MONTHS ENDED SEPTEMBER 30, 2024 VS.

THREE MONTHS ENDED SEPTEMBER 30, 2023

During the third quarter of 2024, truckload services revenue, before fuel surcharges, decreased 1.5% to $110.6 million as compared to $112.3 million during the third quarter of 2023.

The decrease relates primarily to a 1.5% decrease in total miles travelled from 47.2 million for the third quarter of 2023 to 46.5 million for the third quarter of 2024 and to a 2.0% decrease in our rate per mile, from $2.14 for the third quarter of 2023 to $2.10 for the third quarter of 2024.

The reduction in total miles was primarily driven by a 1.6% reduction in average miles driven by each truck combined with a 1.4% reduction in the average number of trucks operated during the third quarter of 2024 compared to the third quarter of 2023.

Operating supplies and expenses decreased from 13.3% of revenues, before fuel surcharges, during the third quarter of 2023 to 11.7% of revenues, before fuel surcharges, during the third quarter of 2024.

The decrease relates primarily to a reduction in repair and tire expenses, which is a result of introducing new, more reliable revenue equipment to our fleet, while retiring older, less-reliable revenue equipment.

The decrease can also be partially attributed to a decrease in truck count from the third quarter of 2023 to the third quarter of 2024.

Rent and purchased transportation increased from 22.6% of revenues, before fuel surcharges, during the third quarter of 2023 to 26.7% of revenues, before fuel surcharges, during the third quarter of 2024.

The increase was primarily attributable to an increase in the proportion of miles driven by third-party carriers quarter over quarter, as the average number of third-party trucks increased from 326 during the third quarter of 2023 to 481 during the third quarter of 2024, while the average number of company trucks decreased from 2,007 to 1,820 during that same period.

Depreciation increased from 13.6% of revenues, before fuel surcharges, during the third quarter of 2023 to 15.8% of revenues, before fuel surcharges, during the third quarter of 2024.

The increase relates primarily to an increase in cost for replacement revenue equipment compared to the cost of retired equipment and to the interaction of a decrease in operating revenues with the fixed-cost nature of depreciation expense.

Non-operating income improved from 1.0% of revenues, before fuel surcharges, during the third quarter of 2023 to 3.3% of revenues, before fuel surcharges, during the third quarter of 2024.

This increase primarily resulted from an increase in the market value of our marketable equity securities portfolio as of September 30, 2024 compared to September 30, 2023.

Interest expense increased from 1.4% of revenues, before fuel surcharges, during the third quarter of 2023 to 2.5% of revenues, before fuel surcharges, during the third quarter of 2024.

This increase is attributed to an increase in equipment note debt and to an increase in average borrowing rates from 3.66% during the third quarter of 2023 to 4.73% during the third quarter of 2024.

NINE MONTHS ENDED SEPTEMBER 30, 2024 VS.

NINE MONTHS ENDED SEPTEMBER 30, 2023

For the nine months ended September 30, 2024, truckload services revenue, before fuel surcharges, decreased 10.7% to $319.4 million as compared to $357.7 million for the nine months ended September 30, 2023.

The decrease relates primarily to an 8.0% decrease in total miles travelled from 148.3 million during the first nine months of 2023 to 136.4 million for the first nine months of 2024 and to a 3.4% decrease in our rate per mile, from $2.17 for the first nine months of 2023 to $2.10 for the first nine months of 2024.

The reduction in total miles was primarily driven by a 4.2% reduction in the average number of trucks operated combined with a 4.5% reduction in average miles driven by each truck during the first nine month of 2024 compared to the first nine months of 2023.

The reduction in truck count and miles resulted from a less favorable freight market year over year, characterized by an oversupply of available trucks in the market compared to available freight.

Salaries, wages and benefits increased from 37.2% of revenues, before fuel surcharges, in the first nine months of 2023 to 39.0% of revenues, before fuel surcharges, during the first nine months of 2024.

This year to year percentage-based increase is explained by the interaction of salaries and wages with fixed-cost characteristics combined with the year to year reduction in revenue recognized during the first nine months of the year.

Rent and purchased transportation increased from 23.0% of revenues, before fuel surcharges, during the first nine months of 2023 to 25.3% of revenues, before fuel surcharges, during the first nine months of 2024.

The increase was primarily attributable to an increase in the proportion of miles driven by third-party carriers year over year.

The average number of third-party trucks utilized increased from 360 during the first nine months of 2023 to 455 during the first nine months of 2024, while the average number of company trucks decreased from 2,038 to 1,842 during that same period.

Depreciation increased from 13.1% of revenues, before fuel surcharges, during the first nine months of 2023 to 17.1% of revenues, before fuel surcharges, during the first nine months of 2024.

Insurance and claims expense decreased from 7.0% of revenues, before fuel surcharges, during the first nine months of 2023 to 4.7% of revenues before fuel surcharges, during the first nine months of 2024.

This decrease relates primarily to specific auto liability claims being settled in the latter half of 2023.

This decrease was partially offset by a 12.8% increase in auto liability premiums year over year.

Non-operating income increased from 0.8% of revenues, before fuel surcharges, during the first nine months of 2023 to 2.3% of revenues, before fuel surcharges, during the first nine months of 2024.

This increase resulted primarily from an increase in the market value of our marketable equity securities portfolio as of September 30, 2024 as compared to September 30, 2023.

Interest expense increased from 1.5% of revenues, before fuel surcharges, during the first nine months of 2023 to 2.6% of revenues, before fuel surcharges, during the first nine months of 2024.

This increase is attributed to an increase in equipment note debt and to an increase in average borrowing rates from 3.66% as of September 30, 2023 to 4.73% as of September 30, 2024.

The truckload services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 96.0% for the first nine months of 2023 to 102.8% for the first nine months of 2024.

Loss before income taxes

THREE MONTHS ENDED MARCH 31, 2025 VS.

THREE MONTHS ENDED MARCH 31, 2024

During the first quarter of 2025, truckload services revenue, before fuel surcharges, decreased by 9.6% to $92.4 million as compared to $102.2 million during the first quarter of 2024.

The decrease relates primarily to a 6.5% decrease in total miles travelled from 44.1 million during the first quarter of 2024 to 41.2 million during the first quarter of 2025 and to a 3.3% decrease in our rate per mile, from $2.11 for the quarter ended March 31, 2024 to $2.04 for the quarter ended March 31, 2025.

The reduction in total miles was primarily driven by a 3.5% reduction in the average number of trucks operated combined with a 1.5% reduction in average miles driven by each truck during the quarter ended March 31, 2025 compared to the quarter ended March 31, 2024.

The reduction in truck count and miles resulted from a less favorable freight market characterized by an oversupply of available trucks in the market compared to available freight.

Salaries, wages and benefits increased from 40.5% of revenues, before fuel surcharges, in the first quarter of 2024 to 41.3% of revenues, before fuel surcharges, during the first quarter of 2025.

The percentage-based increase relates primarily to the interaction of a decrease in operating revenues with the fixed-cost nature of employing human capital.

Operating supplies and expenses increased from 12.4% of revenues, before fuel surcharges, during the first quarter of 2024 to 13.5% of revenues, before fuel surcharges, during the first quarter of 2025.

The increase relates primarily to the interaction of expenses with fixed-cost characteristics, such as rents, driver training schools and operating taxes and licenses with a decrease in revenue.

Rent and purchased transportation increased from 22.2% of revenues, before fuel surcharges, during the first quarter of 2024 to 25.8% of revenues, before fuel surcharges, during the first quarter of 2025.

The increase was primarily due to a quarter-over-quarter increase in the percentage of miles driven by third-party owner-operators as opposed to company-employed drivers.

Depreciation increased from 18.3% of revenues, before fuel surcharges, during the first quarter of 2024 to 24.0% of revenues, before fuel surcharges, during the first quarter of 2025.

The increase is primarily attributed to management’s change in accounting estimates related to the salvage values and useful lives of revenue equipment during the year ended December 31, 2024.

During 2024, the Company conducted a review of its revenue equipment and determined that changes in market conditions and expected asset usage warranted a revision to the estimated useful lives and salvage values of certain equipment.

As a result, during the year ended December 31, 2024, the Company reduced the estimated useful lives of its trailer equipment and lowered the estimated salvage values of revenue equipment to better reflect their expected residual values at the end of their service periods.

This change in accounting estimates shortened the depreciable life and increased the depreciable base for a significant portion of the company’s revenue equipment, thus increasing future monthly depreciation expense for the affected assets.

In addition to the effect from the Company’s previous change in accounting estimate, the year-over-year increase can also be attributed to the interaction of a decrease in operating revenues with the fixed-cost nature of depreciation expense.

Non-operating income decreased from 3.7% of revenues, before fuel surcharges, during the first quarter of 2024 to 2.7% of revenues, before fuel surcharges, during the first quarter of 2025.

The decline was primarily driven by slower growth in the market value of our marketable equity securities as of March 31, 2025, compared to the same date in 2024, as well as a reduction in interest income recognized during the quarter ended March 31, 2025.

Interest expense increased from 2.5% of revenues, before fuel surcharges, during the first quarter of 2024 to 4.2% of revenues, before fuel surcharges, during the first quarter of 2025.

The increase is attributed to the Company’s increased long-term debt from $271.6 million at March 31, 2024 to $309.2 million at March 31, 2025, coupled with an increase in interest rates as the Company’s weighted average interest rate increased from 4.45% in 2023 to 5.04% in 2024.

The truckload services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 104.2% for the first quarter of 2024 to 110.9% for the first quarter of 2025.

RESULTS OF OPERATIONS – LOGISTICS AND BROKERAGE SERVICES

3 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

(percentages)

5 unchanged sentences

Operating income

Non-operating income / (expense)

Non-operating income

Interest expense

Income before income taxes

THREE MONTHS ENDED SEPTEMBER 30, 2024 VS.

THREE MONTHS ENDED SEPTEMBER 30, 2023

During the third quarter of 2024, logistics and brokerage services revenue, before fuel surcharges, decreased 19.2% to $50.2 million as compared to $62.1 million during the third quarter of 2023.

The decrease relates to a reduction in the average rates charged to customers year to year, as the truckload market continues to be negatively impacted by downward rate pressure driven by the challenging truckload rate environment.

Rents and purchased transportation increased from 85.7% of revenues, before fuel surcharges, during the third quarter of 2023 to 86.8% of revenues, before fuel surcharges, during the third quarter of 2024.

The increase resulted from paying third-party carriers a larger percentage of customer revenue.

The logistics and brokerage services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 93.3% for the third quarter of 2023 to 94.3% for the third quarter of 2024.

NINE MONTHS ENDED SEPTEMBER 30, 2024 VS.

NINE MONTHS ENDED SEPTEMBER 30, 2023

During the first nine months of 2024, logistics and brokerage services revenue, before fuel surcharges, decreased 15.4% to $162.6 million as compared to $192.2 million during the first nine months of 2023.

Rents and purchased transportation increased from 84.1% of revenues, before fuel surcharges, during the first nine months of 2023 to 86.4% of revenues, before fuel surcharges, during the first nine months of 2024.

The increase resulted from paying third-party carriers a larger percentage of customer revenue.

The logistics and brokerage services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 91.2% for the first nine months of 2023 to 94.0% for the first nine months of 2024.

THREE MONTHS ENDED MARCH 31, 2025 VS.

THREE MONTHS ENDED MARCH 31, 2024

During the first quarter of 2025, logistics and brokerage services revenue, before fuel surcharges, decreased 24.7% to $44.3 million as compared to $58.8 million during the first quarter of 2024.

The decrease was primarily related to a 28.0% decrease in the number of brokered loads during the first quarter 2025 as compared to 2024.

Rents and purchased transportation increased from 86.1% of revenues, before fuel surcharges, during the first quarter of 2024 to 88.4% of revenues, before fuel surcharges, during the first quarter of 2025.

The increase results from paying third-party carriers a larger percentage of customer revenue, coupled with the interaction of a decrease in operating revenues and the need for purchased transportation.

The logistics and brokerage services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 93.9% for the first quarter of 2024 to 98.0% for the first quarter of 2025.

RESULTS OF OPERATIONS – COMBINED SERVICES

THREE MONTHS ENDED SEPTEMBER 30, 2024 VS.

THREE MONTHS ENDED SEPTEMBER 30, 2023

Net income for all divisions was approximately $2.4 million, or 1.5% of revenues, before fuel surcharges for the third quarter of 2024 as compared to net income of $6.1 million, or 3.5% of revenues, before fuel surcharges for the third quarter of 2023.

The decrease in net income resulted in diluted earnings per share of $0.11 for the third quarter of 2024 as compared to diluted earnings per share of $0.28 for the third quarter of 2023.

NINE MONTHS ENDED SEPTEMBER 30, 2024 VS.

NINE MONTHS ENDED SEPTEMBER 30, 2023

For the first nine months of 2024, all divisions recognized a combined net loss of approximately $0.2 million, or 0.1% in excess of revenues, before fuel surcharges as compared to net income of $20.6 million, or 3.8% of revenues, before fuel surcharges for the first nine months of 2024.

The decrease in net income resulted in a diluted loss per share of $(0.01) for the first nine months of 2024 as compared to diluted earnings per share of $0.93 for the first nine months of 2023.

THREE MONTHS ENDED MARCH 31, 2025 VS.

THREE MONTHS ENDED MARCH 31, 2024

Net loss for all divisions was approximately $8.1 million, or (6.0)% of revenues, before fuel surcharges, for the first quarter of 2025 as compared to net income of $0.3 million, or 0.2% of revenues, before fuel surcharges, for the first quarter of 2024.

The decrease in net income resulted in diluted loss per share of $0.37 for the first quarter of 2025 as compared to diluted earnings per share of $0.01 for the first quarter of 2024.

LIQUIDITY AND CAPITAL RESOURCES

Our business has required, and will continue to require, a significant investment in new revenue equipment.

Our primary sources of liquidity have been funds provided by operations, proceeds from the sales of revenue equipment, and borrowings under our credit facilities, installment notes, and investment margin account.

During the first nine months of 2024, we generated $43.8 million in cash from operating activities.

Investing activities used $54.9 million in cash in the first nine months of 2024.

Financing activities used $41.4 million in cash in the first nine months of 2024.

Our primary sources of liquidity have been funds provided by operations, proceeds from the sales of revenue equipment, borrowings under our lines of credit, installment notes, investment margin account, and issuances of equity securities.

During the first three months of 2025, we generated $5.0 million in cash from operating activities.

Investing activities generated $0.4 million in cash in the first three months of 2025.

Financing activities used $16.3 million in cash in the first three months of 2025.

Our primary use of funds is for the purchase of revenue equipment.

We typically use installment notes with fixed interest rates and terms ranging from 36 to 84 months, our existing line of credit on an interim basis, proceeds from the sale or trade of equipment, and cash flows from operations to finance capital expenditures and repay long-term debt.

During the first nine months of 2024, we utilized cash on hand, installment notes, and our line of credit to finance purchases of revenue equipment and other assets of approximately $124.4 million.

During the remainder of 2024, we expect to purchase approximately 232 trucks and 400 trailers while continuing to sell or trade older equipment, which we expect to result in net capital expenditures of approximately $18.9 million.

On April 24, 2024, we commenced a tender offer to repurchase up to 550,000 shares of the Company’s outstanding common stock at a price of not greater than $18.00 nor less than $15.50 per share.

During the first three months of 2025, we utilized cash on hand, installment notes, and our line of credit to finance purchases of revenue equipment and other assets of approximately $11.8 million.

During the remainder of 2025, we expect to purchase approximately 282 new trucks and 775 new trailers while continuing to sell or trade older equipment, which we expect to result in net capital expenditures of approximately $30.2 million.

On April 3, 2025, we commenced a tender offer to repurchase up to 435,000 shares of our outstanding common stock at a price of not greater than $17.00 nor less than $14.00 per share.

On April 11, 2025, we amended the terms of the tender offer to increase the minimum purchase price for shares purchased in the tender offer to $14.50 per share.

Following the expiration of the tender offer on May 1, 2025, we accepted 870,000 shares of our common stock for purchase at $17.00 per share, at an aggregate purchase price of approximately $14.8 million, excluding fees and expenses related to the offer.

The Company funded the purchase of the accepted shares tendered with available cash.

The number of shares we purchased reflects our right to purchase additional shares in the tender offer up to an additional 2% of our outstanding shares.

We funded the purchase of the accepted shares tendered with available cash.

We currently intend to retain our future earnings to finance our growth and do not anticipate paying cash dividends in the foreseeable future.

During the first nine months of 2024, we maintained a revolving line of credit.

Amounts outstanding under the line bear interest at Term SOFR plus 1.85% (7.18% at September 30, 2024), are secured by our trade accounts receivable and mature on July 1, 2027.

An “unused fee” of 0.25% is charged if average borrowings are less than $18.0 million.

At September 30, 2024 we had no outstanding borrowings against the line of credit and approximately $0.1 million of outstanding letters of credit, with availability to borrow $59.9 million.

Trade accounts receivable increased from $80.6 million at December 31, 2023 to $93.7 million at September 30, 2024.

The increase was a result of an increase in revenues, which flow through accounts receivable, during the final month of the quarter ending September 30, 2024 compared to the final month of the year ending December 31, 2023.

Additionally, the company’s cash suspense decreased during the first nine months of 2024 as compared to the fourth quarter of 2023.

Prepaid expenses and deposits decreased from $13.2 million at December 31, 2023 to $9.5 million at September 30, 2024.

During the first three months of 2025, we maintained a revolving line of credit with a borrowing limit of $60.0 million.

Under this credit facility, amounts outstanding under the line bear interest at Term SOFR plus 1.85% (6.24% at March 31, 2025), are secured by our trade accounts receivable and mature on July 1, 2027.

The credit facility also establishes an “unused fee” of 0.25% if average borrowings are less than $18.0 million.

At March 31, 2025, we had no outstanding borrowings against the line of credit and approximately $0.2 million of outstanding letters of credit, with availability to borrow $59.8 million.

Prepaid expenses and deposits decreased from $11.6 million at December 31, 2024 to $10.5 million at March 31, 2025.

The decrease relates to the normal amortization of items prepaid as of December 31, 2024.

Revenue equipment increased from $689.2 million at December 31, 2023 to $726.2 million at September 30, 2024.

The increase is primarily due to the purchase of new trucks and trailers during the first nine months of 2024, partially offset by the disposition of aging trucks and trailers during the first nine months of 2024.

Land increased from $23.1 million at December 31, 2023 to $30.4 million at September 30, 2024.

The increase is primarily due to the purchase of land in El Paso, Texas that will serve as an additional terminal for our truckload operations.

Accounts payable decreased from $62.7 million at December 31, 2023 to $37.9 million at September 30, 2024.

This decrease was primarily attributable to payments made in the first nine months of 2024 on contracts for revenue equipment placed in service, but not yet paid for at December 31, 2023.

As of September 30, 2024, our accounts payable includes outstanding invoices for revenue equipment totaling $0.9 million.

Our marketable equity securities portfolio grew $3.0 million during the first quarter of 2025 from $42.6 million at December 31, 2024 to $45.6 million at March 31, 2025.

The increase was driven entirely by unrealized gains due to favorable market value changes in the underlying equity holdings.

Revenue equipment decreased from $733.2 million at December 31, 2024 to $697.6 million at March 31, 2025.

The decrease is primarily due to the disposition of aging trucks and trailers during the first quarter of 2025, partially offset by purchases of new trucks and trailers during the first quarter of 2025.

During the first quarter of 2025, our current income tax position shifted from a net refundable asset of $2.3 million at December 31, 2024 to a net payable liability of $6.4 million at March 31, 2025.

This change was primarily driven by the reversal of previously recognized temporary differences, most notably those related to accelerated depreciation.

The transition was expected and reflects the normal timing of cash tax obligations in relation to book-tax differences.

In connection with these reversals, our deferred income tax liability also decreased from $92.5 million at December 31, 2024 to $81.2 million at March 31, 2025.

The reduction primarily reflects the realization of deferred tax liabilities established in prior periods for the same temporary differences, most notably those related to accelerated depreciation.

Accounts payable and accrued expenses remained relatively flat over the quarter, with balances of $31.1 million and $15.1 million, respectively at March 31, 2025 compared to $31.2 million and $14.6 million, respectively, at December 31, 2024.

Long-term debt and current maturities of long term-debt are reviewed on an aggregate basis, as the classification of amounts in each category are typically affected merely by the passage of time.

Long-term debt and current maturities of long-term debt, on an aggregate basis, increased from $261.7 million at December 31, 2023 to $288.7 million at September 30, 2024.

The increase was primarily related to the financing of additional revenue equipment during the first nine months of 2024.

Long-term debt and current maturities of long-term debt, on an aggregate basis, decreased from $325.6 million at December 31, 2024 to $309.2 million at March 31, 2025.

The decrease reflects schedule principal payments and the absence of new financing arrangements for revenue equipment during the first quarter of 2025.

NEW ACCOUNTING PRONOUNCEMENTS

1 unchanged sentence

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