What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-08-08 compared with 2025-05-09 · 285 added, 143 removed, 477 unchanged (47% of the section changed)

10 unchanged sentences

Prepaid expenses and deposits

10,456 11,555

Marketable equity securities

41 unchanged sentences

22,377,606 and 22,364,120 shares issued;

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

20,926,020 and 21,782,534 shares outstanding at June 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

1 unchanged sentence

Treasury stock, at cost;

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

1,451,586 and 581,586 shares at June 30, 2025 and December 31, 2024, respectively

( 28,924 ) ( 13,996 )

10 unchanged sentences

Three Months Ended

Six Months Ended

OPERATING REVENUES:

14 unchanged sentences

Insurance and claims

(Gain)/loss on sale or disposition of equipment

5,167 5,464 9,948 10,325

4,986 5,752 9,985 12,931

(Gain)/Loss on disposition of equipment

( 4,414 ) ( 139 ) ( 7,428 ) 101

Total operating expenses and costs

3 unchanged sentences

NON-OPERATING INCOME

2,263 209 4,749 4,147

INTEREST EXPENSE

( 4,032 ) ( 3,284 ) ( 8,075 ) ( 6,167 )

(LOSS)/INCOME BEFORE INCOME TAXES

LOSS BEFORE INCOME TAXES

( 12,838 ) ( 3,780 ) ( 23,587 ) ( 3,401 )

1 unchanged sentence

( 3,758 ) ( 47 ) 4,940 59

547 ( 823 ) ( 10,757 ) ( 831 )

Total federal and state income tax (benefit)/expense

NET (LOSS)/INCOME

( 3,211 ) ( 870 ) ( 5,817 ) ( 772 )

(LOSS)/INCOME PER COMMON SHARE:

$ ( 9,627 ) $ ( 2,910 ) $ ( 17,770 ) $ ( 2,629 )

LOSS PER COMMON SHARE:

$ ( 0.46 ) $ ( 0.13 ) $ ( 0.83 ) $ ( 0.12 )

AVERAGE COMMON SHARES OUTSTANDING:

5 unchanged sentences

(in thousands)

Three Months Ended

Six Months Ended

OPERATING ACTIVITIES:

Net (loss)/income

$ ( 17,770 ) $ ( 2,629 )

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

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

44,315 37,640

1 unchanged sentence

Stock compensation-net of excess tax benefits

Benefit for deferred income taxes

Provision for deferred income taxes

( 10,757 ) ( 831 )

Recognized (gain) on marketable equity securities

Gain on marketable equity securities

( 2,371 ) ( 1,434 )

5 unchanged sentences

Prepaid expenses, deposits, inventories, and other assets

Income taxes refundable

Income taxes payable

1,774 ( 590 )

Trade accounts payable

( 382 ) 1,176

Accrued expenses and other liabilities

Net cash provided by operating activities

17,206 28,270

INVESTING ACTIVITIES:

1 unchanged sentence

( 18,149 ) ( 36,441 )

Sales of equity investments

Purchases of equity investments/return of capital

Proceeds from disposition of equipment

29,235 17,707

Sales of marketable equity securities

Purchases of marketable equity securities

Net cash provided (used) by investing activities

1 unchanged sentence

FINANCING ACTIVITIES:

Borrowings under line of credit

Borrowings under lines of credit

324,864 384,836

Repayments under line of credit

Repayments under lines of credit

( 324,864 ) ( 384,836 )

Borrowings of long-term debt

Repayments of long-term debt

( 39,801 ) ( 35,538 )

Net cash used for financing activities

Borrowings under margin account

Repayments under margin account

Repurchases of common stock

( 14,928 ) ( 5,259 )

NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

Net cash used in financing activities

( 24,044 ) ( 40,797 )

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

855 ( 28,630 )

CASH, CASH EQUIVALENTS AND RESTRICTED CASH -Beginning of period

7 unchanged sentences

Purchases of property and equipment included in accounts payable

$ 362 $ 1,353

See notes to condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Common Stock Additional Treasury Retained

Shares/Amount Paid-In Capital Stock Earnings Total

Shares / Amount

Paid-In Capital

Balance at January 1, 2025

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

21,783 $ 224 $ 41,171 $ ( 13,996 ) $ 250,109 $ 277,508

- - - - ( 8,142 ) ( 8,142 )

Restricted stock issued

8 - ( 37 ) - - ( 37 )

Stock based compensation

- - 266 - - 266

Balance at March 31, 2025

Common Stock Additional Treasury Retained

Shares/Amount Paid-In Capital Stock Earnings Total

21,791 $ 224 $ 41,400 $ ( 13,996 ) $ 241,967 $ 269,595

- - - - ( 9,627 ) ( 9,627 )

Treasury stock repurchases

( 870 ) - - ( 14,928 ) - ( 14,928 )

Restricted stock issued

Stock based compensation

- - ( 126 ) - - ( 126 )

Balance at June 30, 2025

20,926 $ 224 $ 41,274 $ ( 28,924 ) $ 232,340 $ 244,914

Shares / Amount

Paid-In Capital

Balance at January 1, 2024

Net loss - - - - 281 281

22,021 $ 223 $ 40,825 $ ( 8,736 ) $ 281,904 $ 314,216

- - - - 281 281

Restricted stock issued

14 - ( 46 ) - - ( 46 )

Stock based compensation

- - 192 - - 192

Balance at March 31, 2024

22,035 $ 223 $ 40,971 $ ( 8,736 ) $ 282,185 $ 314,643

- - - - ( 2,910 ) ( 2,910 )

Treasury stock repurchases

( 285 ) - - ( 5,259 ) - ( 5,259 )

Restricted stock issued

Stock based compensation

- - 200 - - 200

Balance at June 30, 2024

21,755 $ 223 $ 41,171 $ ( 13,995 ) $ 279,275 $ 306,674

See notes to condensed consolidated financial statements.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements (unaudited)

March 31, 2025

June 30, 2025

BASIS OF PRESENTATION

5 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 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.

Operating results for the six -month period ended June 30, 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.

12 unchanged sentences

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.

The FASB also issued ASU 2025 - 01 in January clarifying that ASU 2024 - 03 is effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted.

24 unchanged sentences

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.

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.

The contract asset, or the amount of remaining performance obligation relating to loads in process, at June 30, 2025 was $ 3.0 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 had no contract liabilities associated with our operations as of June 30, 2025 and December 31, 2024, respectively.

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

3 unchanged sentences

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 (expense).

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

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 March 31, 2025 and December 31, 2024.

March 31, 2025

The following table sets forth market value, cost, and unrealized gains on equity securities as of June 30, 2025 and December 31, 2024.

June 30, 2025

December 31, 2024

5 unchanged sentences

$ 18,187 $ 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

The following table sets forth the gross unrealized gains and losses on the Company’s marketable securities as of June 30, 2025 and December 31, 2024.

June 30, 2025

December 31, 2024

5 unchanged sentences

$ 18,187 $ 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.

The following table shows the Company’s net realized gains during the three and six months ending on June 30, 2025 and 2024, respectively, on certain marketable equity securities.

Three Months Ended

March 31, 2025

December 31, 2024

Six Months Ended

(in thousands)

Sales proceeds

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.

$ 742 $ 2,631 $ 743 $ 2,631

Cost of securities sold

1,030 2,815 1,034 2,815

Realized loss

$ ( 288 ) $ ( 184 ) $ ( 291 ) $ ( 184 )

For the quarter ended June 30, 2025, the Company recognized dividends received of approximately $ 392,000 in non-operating income in its condensed consolidated statements of operations.

For the six months ended June 30, 2025, the Company recognized dividends received of approximately $ 835,000 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 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.

As of June 30, 2025, the Company had outstanding borrowings of approximately $ 685,000 under its margin account, compared to no outstanding borrowings under its margin account at December 31,2024.

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.

Our marketable equity securities portfolio had a net unrealized pre-tax gain in market value of approximately $ 1,058,000 during the second quarter of 2025, and a net unrealized pre-tax loss in market value of approximately $ 1,153,000 during the second 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 maintains a stock incentive plan under which incentive and nonqualified stock options and other stock awards may be granted.

The Company maintains a stock incentive plan under which incentive and non-qualified 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”).

2 unchanged sentences

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.

During May 2025, the Company granted 2,862 shares of common stock to non-employee directors.

This stock award had a grant date fair value of $ 15.71 per share, based on the closing price of the Company’s stock on the date of grant, and vested immediately.

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 stock option exercise price and the restricted stock purchase price under the 2014 Plan were 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.

1 unchanged sentence

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

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.

The total grant date fair value of stock vested during the first six months of 2025 was approximately $ 437,000 .

The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first six months of 2025, was approximately $ 140,000 and includes approximately $ 45,000 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 $ 0.01 during the first six months of 2025.

As of June 30, 2025, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $ 1,147,000 , which is being amortized on a straight-line basis over the remaining vesting period.

As a result, the Company expects to recognize approximately $ 336,000 in additional compensation expense related to unvested stock awards during the remainder of 2025 and to recognize approximately $ 304,000 , $ 242,000 , and $ 233,000 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

The total grant date fair value of stock vested during the first six months of 2024 was approximately $ 550,000 .

The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first six months of 2024, was approximately $ 393,000 and included 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 $ 0.01 during the first six months of 2024.

As of June 30, 2024, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $ 1,779,000 , 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 awards as of June 30, 2025, and changes during the six months ended June 30, 2025, is as follows:

Average Grant

2 unchanged sentences

128,591 $ 13.79

Unrestricted Shares Issued

102,862 16.09

1 unchanged sentence

( 141,329 ) 11.90

Non-vested at March 31, 2025

( 15,862 ) 27.52

Non-vested at June 30, 2025

74,262 $ 17.64

SEGMENT INFORMATION

6 unchanged sentences

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

Three Months Ended March 31,

(in thousands, except percentage data)

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands)

Truckload Services revenue

5 unchanged sentences

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)

The table below presents revenue dollars and percentages, each including fuel surcharges, by geographic area:

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands, except percentage data)

United States - domestic shipments

7 unchanged sentences

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.

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

As of June 30, 2025, there remain 474,016 shares of common stock authorized for repurchase under this plan.

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 accounted for the repurchase of these shares as treasury stock on the Company’s condensed consolidated balance sheet as of June 30, 2025.

The Company accounts for treasury stock using the cost method.

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

As of June 30, 2025, 1,451,586 shares were held in the treasury at an aggregate cost of approximately $ 28,924,000 .

EARNINGS PER SHARE

4 unchanged sentences

Three Months Ended

Six Months Ended

(in thousands, except per share data)

Net (loss)/income

$ ( 9,627 ) $ ( 2,910 ) $ ( 17,770 ) $ ( 2,629 )

4 unchanged sentences

21,095 21,932 21,498 21,981

Basic (loss)/earnings per share

Basic loss per share

$ ( 0.46 ) $ ( 0.13 ) $ ( 0.83 ) $ ( 0.12 )

Diluted (loss)/earnings per share

Diluted loss per share

$ ( 0.46 ) $ ( 0.13 ) $ ( 0.83 ) $ ( 0.12 )

4 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 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.

As of June 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.

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 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.

As of June 30, 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 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.

During the six months ended June 30, 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 24.7 % and 22.7 % for the six months ended June 30, 2025 and 2024, respectively.

Our effective tax rate for the six months ended June 30, 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 March 31, 2025, the following items are measured at fair value on a recurring basis:

At June 30, 2025, the following items are measured at fair value on a recurring basis:

(in thousands)

5 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 March 31, 2025 was as follows:

The carrying value and estimated fair value of this other long-term debt at June 30, 2025 was as follows:

(in thousands)

3 unchanged sentences

NOTES PAYABLE

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

During the first six months of 2025, the Company’s subsidiaries entered into installment obligations totaling approximately $ 45.5 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.

COMMITMENTS AND CONTINGENCIES

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

4 unchanged sentences

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.

During the first six months of 2025, we maintained a revolving line of credit with a borrowing limit of $ 60.0 million that contains certain restrictive covenants, which must be maintained by the Company on a consolidated basis.

Under the terms of the loan agreement, the Company must maintain a debt to adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization, excluding gains/losses on equity securities and extraordinary items, calculated on a rolling four -quarter basis) ratio of less than 4.00 to 1.00 as of the end of each calendar quarter.

As of June 30, 2025, the Company was not in compliance with this financial covenant.

The elevated debt to adjusted EBITDA ratio was primarily the result of increased funded debt related to the purchase of $ 144.2 million of revenue equipment during 2024, most of which was financed, combined with a decrease in trailing twelve -month adjusted EBITDA due to the phasing out of earlier, more favorable quarters from the rolling four -quarter calculation.

The loan agreement provides a 45 -day cure period for financial covenant violations, during which the Company is not deemed to be in default of the loan agreement.

On August 7, 2025, within the permitted cure period, the Company received a written waiver from the lender for the covenant violation applicable to the period ended June 30, 2025.

As a result of the waiver, the Company was not in default under the terms of the credit facility as of June 30, 2025 or as of the date of this filing.

The Company is in compliance with all other covenants under the agreement.

At June 30, 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.

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 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 March 31, 2025.

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.

In May 2025, the Company entered into an operating lease for shop and office space for an initial term of three years that does not provide an option for early cancellation.

In accordance with the provisions of ASC Topic 842, this lease resulted in the recognition of a right-of-use asset and corresponding operating lease liability of $ 0.9 million as of June 30, 2025.

These assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date, using the Company’s incremental borrowing rate as of the respective dates of lease inception, as the rate implicit in each lease is not readily determinable.

The right-of-use assets are recorded in other assets, and the lease liability is recorded in accrued expenses and other liabilities and in other long-term liabilities on our condensed consolidated balance sheet at June 30, 2025.

Lease expense is recorded on a straight-line basis over the lease term and is recorded in rent and purchased transportation in our condensed consolidated statements of operations.

While these lease agreements may contain provisions to extend after the initial term for an additional five years, the Company is not reasonably certain these extension options will be exercised.

Therefore, potential lease payments that might occur under this extension period are not included in amounts recorded in our condensed consolidated balance sheets as of June 30, 2025.

Scheduled amounts and timing of cash flows arising from future right-of-use operating lease payments at June 30, 2025, are:

Maturity of Lease Liabilities

(in thousands)

2025 (remaining)

2028 and thereafter

Total undiscounted operating lease payments

Imputed interest

Present value of operating lease liabilities

Balance Sheet Classification

Right-of-use assets (recorded in other non-current assets)

Current lease liabilities (recorded in other current liabilities)

Long-term lease liabilities (recorded in other long-term liabilities)

Total operating lease liabilities

Other Information

Weighted-average remaining lease term for operating leases (years)

Weighted-average discount rate for operating leases

A right-of-use asset of $ 1.0 million was recognized as a non-cash asset addition that resulted from new operating lease liabilities during the three months ended June 30, 2025.

Cash paid for amounts included in the present value of operating lease liabilities was $ 0.05 million during the three months ended June 30, 2025 and is included in operating cash flows.

Operating Lease Costs

Three Months Ended

Six Months Ended

(in thousands)

$ 48 $ 29 $ 48 $ 114

1,085 825 1,864 1,680

$ 1,133 $ 854 $ 1,912 $ 1,794

Lease Revenue

1 unchanged sentence

Three Months Ended

Six Months Ended

(in thousands)

1 unchanged sentence

$ 2,623 $ 2,501 $ 5,228 $ 4,492

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

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

209 111 412 239

Total lease revenue

$ 2,832 $ 2,612 $ 5,640 $ 4,731

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.

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 owner-operator defaults on their lease, the Company generally leases the truck to another independent contractor.

As of June 30, 2025, the gross carrying value of trucks underlying these leases was $ 67.5 million and accumulated depreciation was $ 33.9 million.

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

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

During the quarter ended June 30, 2025, the Company incurred $ 2.4 million of depreciation expense for these assets.

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

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Lease Receivables

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

Future minimum operating lease payments receivable at June 30, 2025:

(in thousands)

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NONCASH INVESTING AND FINANCING ACTIVITIES

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

The Company financed approximately $ 15.5 million in equipment purchases during the first six months of 2025 utilizing noncash financing, compared to approximately $ 39.9 million during the same period of 2024.

SUBSEQUENT EVENTS

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.

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.

On July 4, 2025, the “One Big Beautiful Bill Act” was enacted into law.

Among other provisions, the legislation reinstates 100% bonus depreciation for qualifying property placed in service after December 31, 2024, and modifies the limitation on business interest expense under Internal Revenue Code Section 163 (j) to be based on 30% of adjusted taxable income determined using an EBITDA measure, rather than EBIT.

These provisions are effective for tax years beginning after December 31, 2024, and therefore apply to the Company’s 2025 tax year.

As the legislation was enacted after the balance sheet date, its provisions did not impact the Company’s income tax provision or financial position as of June 30, 2025.

The Company is currently evaluating the impact of the new law on its income tax position, cash flows, and financial statements for the remainder of 2025 and future periods.

Based on a preliminary assessment, the Company expects the reinstatement of 100% bonus depreciation and the revised business interest limitation to accelerate tax deductions in the second half of 2025.

These changes are expected to reduce the Company’s estimated income tax payable recorded as of June 30, 2025 by approximately $ 4.5 million, resulting in the recognition of a net tax receivable and a corresponding increase in deferred tax liabilities of approximately $ 4.5 million.

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

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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, 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.

Truckload services revenues, excluding fuel surcharges, represented 69.4% and 66.5% of total revenues, excluding fuel surcharges, for the quarters ended June 30, 2025, and 2024, respectively.

The remaining operating revenues, before fuel surcharges, for the same periods were generated from brokerage and logistics services, representing 30.6% and 33.5%, 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.

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

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

During the three months ended June 30, 2025 and 2024, approximately $17.3 million and $22.7 million, respectively, of the Company’s total revenue was generated from fuel surcharges.

During the six months ended June 30, 2025 and 2024, approximately $36.0 million and $44.4 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.

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Three Months Ended

Six Months Ended

(percentages)

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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.

THREE MONTHS ENDED JUNE 30, 2025 VS.

THREE MONTHS ENDED JUNE 30, 2024

During the second quarter of 2025, truckload services revenue, before fuel surcharges, decreased 12.9% to $92.8 million as compared to $106.6 million during the second quarter of 2024.

The decrease relates primarily to an 11.9% decrease in total miles travelled from 45.8 million for the second quarter of 2024 to 40.4 million for the second quarter of 2025 and to a 2.4% decrease in our rate per mile, from $2.09 for the second quarter of 2024 to $2.04 for the second quarter of 2025.

The reduction in total miles was primarily driven by a 10.7% reduction in the average number of trucks operated while the average miles driven by each truck for the second quarter of 2025 compared to the second quarter of 2024 remained relatively flat.

The reduction in truck count and miles is a result of the ongoing freight recession, characterized by an oversupply of available trucks in the market compared to available freight.

Salaries, wages and benefits increased from 38.6% of revenues, before fuel surcharges, in the second quarter of 2024 to 41.7% of revenues, before fuel surcharges, during the second 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.

Operating supplies and expenses increased from 11.5% of revenues, before fuel surcharges, during the second quarter of 2024 to 12.3% of revenues, before fuel surcharges, during the second 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.

Rent and purchased transportation increased from 26.7% of revenues, before fuel surcharges, during the second quarter of 2024 to 30.2% of revenues, before fuel surcharges, during the second 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.

Depreciation increased from 17.3% of revenues, before fuel surcharges, during the second quarter of 2024 to 23.0% of revenues, before fuel surcharges, during the second 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.

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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.

Gain on disposition of equipment increased from 0.1% of revenues, before fuel surcharges, during the second quarter of 2024 to 4.8% of revenues, before fuel surcharges, during the second quarter of 2025.The increase was primarily due to the disposition of revenue equipment effected by management’s change in accounting estimates related to the salvage value and useful lives of revenue equipment during the year ended December 31, 2024.

The reduced estimated salvage values had a direct impact on gains recognized when disposing revenue equipment during the six months ended June 30, 2025.

Non-operating income increased from 0.1% of revenues, before fuel surcharges, during the second quarter of 2024 to 2.4% of revenues, before fuel surcharges, during the second quarter of 2025.

The increase was primarily driven by growth in the market value of our marketable equity securities as of June 30, 2025, compared to the same date in 2024.

Interest expense increased from 2.9% of revenues, before fuel surcharges, during the second quarter of 2024 to 4.2% of revenues, before fuel surcharges, during the second quarter of 2025.

The increase is attributed to the Company’s increased long-term debt from $266.0 million at June 30, 2024 to $331.2 million at June 30, 2025, coupled with an increase in interest rates as the Company’s weighted average interest rate increased from 4.55% in 2024 to 5.10% in 2025.

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 103.7% for the second quarter of 2024 to 112.5% for the second quarter of 2025.

SIX MONTHS ENDED JUNE 30, 2025 VS.

SIX MONTHS ENDED JUNE 30, 2024

For the six months ended June 30, 2025, truckload services revenue, before fuel surcharges, decreased 11.3% to $185.3 million as compared to $208.8 million for the six months ended June 30, 2024.

The decrease relates primarily to a 9.3% decrease in total miles travelled from 89.9 million during the first six months of 2024 to 81.6 million for the first six months of 2025 and to a 2.8% decrease in our rate per mile, from $2.10 for the first six months of 2024 to $2.04 for the first six months of 2025.

The reduction in total miles was primarily driven by a 7.2% reduction in the average number of trucks operated while the average miles driven by each truck remained relatively flat when comparing the six months ending June 30, 2025 to the six months ending June 30, 2024.

The reduction in truck count and miles is a result of the ongoing freight recession, characterized by an oversupply of available trucks in the market compared to available freight.

Salaries, wages and benefits increased from 39.5% of revenues, before fuel surcharges, in the first six months of 2024 to 41.5% of revenues, before fuel surcharges, during the first six months 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 12.0% of revenues, before fuel surcharges, in the first six months of 2024 to 12.9% of revenues, before fuel surcharges, during the first six months 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 24.5% of revenues, before fuel surcharges, in the first six months of 2024 to 28.0% of revenues, before fuel surcharges, during the first six months 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 17.8% of revenues, before fuel surcharges, during the first six months of 2024 to 23.4% of revenues, before fuel surcharges, during the first six months 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.

Gain on disposition of equipment increased from 0.0% of revenues, before fuel surcharges, during the first six months of 2024 to 4.0% of revenues, before fuel surcharges, during the first six months of 2025.

The increase was primarily due to the disposition of revenue equipment effected by management’s change in accounting estimates related to the salvage value and useful lives of revenue equipment during the year ended December 31, 2024.

The reduced estimated salvage values had a direct impact on gains recognized when disposing revenue equipment during the six months ended June 30, 2025.

Non-operating income increased from 1.8% of revenues, before fuel surcharges, during the first six months of 2024 to 2.5% of revenues, before fuel surcharges, during the first six months of 2025.

The increase was primarily driven by growth in the market value of our marketable equity securities as of June 30, 2025, compared to the same date in 2024.

Interest expense increased from 2.7% of revenues, before fuel surcharges, during the first six months of 2024 to 4.2% of revenues, before fuel surcharges, during the first six months of 2025.

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 103.9% for the first six months of 2024 to 111.7% for the first six months of 2025.

RESULTS OF OPERATIONS – LOGISTICS AND BROKERAGE SERVICES

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Three Months Ended

Six Months Ended

(percentages)

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Income before income taxes

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.

THREE MONTHS ENDED JUNE 30, 2025 VS.

THREE MONTHS ENDED JUNE 30, 2024

During the second quarter of 2025, logistics and brokerage services revenue, before fuel surcharges, decreased 23.6% to $41.0 million as compared to $53.7 million during the second quarter of 2024.

The decrease was primarily related to a 33.7% decrease in the number of brokered loads during the second quarter 2025 as compared to 2024.

Rents and purchased transportation increased from 86.4% of revenues, before fuel surcharges, during the second quarter of 2024 to 89.9% of revenues, before fuel surcharges, during the second quarter of 2025.

The increase results 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 93.9% for the second quarter of 2024 to 98.7% for the second quarter of 2025.

SIX MONTHS ENDED JUNE 30, 2025 VS.

SIX MONTHS ENDED JUNE 30, 2024

During the first six months of 2025, logistics and brokerage services revenue, before fuel surcharges, decreased 24.2% to $85.3 million as compared to $112.4 million during the first six months of 2024.

The decrease was primarily related to a 30.9% decrease in the number of brokered loads during the first six months of 2025 as compared to the first six months of 2024.

Rents and purchased transportation increased from 86.2% of revenues, before fuel surcharges, during the first six months of 2024 to 89.1% of revenues, before fuel surcharges, during the first six months of 2025.

The increase results 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 93.9% for the first six months of 2024 to 98.3% for the first six months of 2025.

RESULTS OF OPERATIONS – COMBINED SERVICES

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.

THREE MONTHS ENDED JUNE 30, 2025 VS.

THREE MONTHS ENDED JUNE 30, 2024

Net loss for all divisions was approximately $9.6 million, or 7.2% in excess of revenues, before fuel surcharges, for the second quarter of 2025 as compared to net loss of $2.9 million, or 1.8% in excess of revenues, before fuel surcharges, for the second quarter of 2024.

The decrease in net income resulted in diluted loss per share of $0.46 for the second quarter of 2025 as compared to diluted loss per share of $0.13 for the second quarter of 2024.

SIX MONTHS ENDED JUNE 30, 2025 VS.

SIX MONTHS ENDED JUNE 30, 2024

For the first six months of 2025, net loss for all divisions was approximately $17.8 million, or 6.6% in excess of revenues, before fuel surcharges as compared to net loss of $2.6 million, or 0.8% of revenues, before fuel surcharges for the first six months of 2024.

The decrease in net income resulted in a diluted loss per share of $0.83 for the first six months of 2025 as compared to diluted loss per share of $0.12 for the first six months of 2024.

LIQUIDITY AND CAPITAL RESOURCES

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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.

During the first six months of 2025, we generated $17.2 million in cash from operating activities.

Investing activities generated $7.7 million in cash in the first six months of 2025.

Financing activities used $24.0 million in cash in the first six 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 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 first six months of 2025, we utilized cash on hand and long-term debt to finance purchases of revenue equipment and other assets of approximately $18.1 million.

During the remainder of 2025, we expect to purchase approximately 188 new trucks and 650 new trailers while continuing to sell or trade older equipment, which we expect to result in net capital expenditures of approximately $25.1 million.

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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 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.

During the first six 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% (6.20% at June 30, 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.

At June 30, 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.

The loan agreement requires us to maintain a debt to adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization, excluding gains and losses on equity securities and extraordinary items, calculated on a rolling four-quarter basis) ratio of less than 4.00 to 1.00 as of the end of each calendar quarter.

As of June 30, 2025, we were not in compliance with this financial covenant.

The elevated debt to adjusted EBITDA ratio was primarily the result of increased funded debt related to the purchase of $144.2 million of revenue equipment during 2024, most of which was financed, combined with a decrease in trailing twelve-month adjusted EBITDA due to the phasing out of earlier, more favorable quarters from the rolling four-quarter calculation.

The agreement provides a 45-day cure period for financial covenant violations, during which we are not deemed to be in default of the loan agreement.

On August 7, 2025, within the permitted cure period, we received a written waiver from the lender for the covenant violation applicable to the period ended June 30, 2025.

We remain in compliance with all other covenants under the agreement as of the date of this filing.

We are currently working with the lender to amend the financial covenant terms of the agreement on a prospective basis and anticipate having a revised covenant metric in place prior to the end of the quarter, ending September 30, 2025.

However, we cannot guarantee that we will reach an agreement with the lender to revise this metric for future quarters on terms favorable to us or at all.

If we are unable to reach an agreement with the lender to revise the financial covenant and do not meet the current covenant as of September 30, 2025, we would need to seek an additional waiver from the lender or obtain an alternative source of funding to supplement our cash flows.

While we have not borrowed any funds under the line of credit during 2025, any failure to meet this covenant in a future quarter or obtain a waiver from the lender within the applicable cure period would accelerate our payment obligations with respect to any future amounts that we may borrow under the credit facility and prevent us from making further borrowings under the facility, either of which could materially and adversely affect our future liquidity.

Prepaid expenses and deposits decreased from $11.6 million at December 31, 2024 to $8.5 million at June 30, 2025.

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

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.

Our marketable equity securities portfolio grew $5.8 million during the first six months of 2025 from $42.6 million at December 31, 2024 to $48.4 million at June 30, 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.

Revenue equipment decreased from $733.2 million at December 31, 2024 to $672.6 million at June 30, 2025.

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

During the first six months 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 $1.8 million at June 30, 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.

In connection with these reversals, our deferred income tax liability also decreased from $92.5 million at December 31, 2024 to $81.8 million at June 30, 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.

In July 2025, the federal government enacted new tax legislation that includes several provisions applicable to tax years beginning after December 31, 2024.

Two provisions are particularly relevant to our business.

First, the law restores 100% bonus depreciation for qualifying capital assets placed in service after 2024, reversing the previously scheduled phase-down.

This change is expected to increase our near-term deductions for fleet and facility investments and may reduce our cash tax obligations in future periods.

Second, the legislation reinstates the more favorable EBITDA-based limitation on the deductibility of business interest under Section 163(j), replacing the prior EBIT-based calculation.

As a capital-intensive operator that finances a portion of its asset base, this change will enhance our ability to deduct interest expense and reduce future cash tax liabilities.

Since the legislation was enacted after June 30, 2025, it did not affect our income tax provision or financial position as of that date.

We are currently evaluating the broader implications of the new law on our liquidity, effective tax rate, and capital planning strategies for the remainder of 2025 and future periods.

These changes are expected to reduce the Company’s estimated income tax payable recorded as of June 30, 2025 by approximately $4.5 million, resulting in the recognition of a net tax receivable and a corresponding increase in deferred tax liabilities of approximately $4.5 million.

Accounts payable and accrued expenses remained relatively flat over the quarter, with balances of $31.0 million and $16.6 million, respectively at June 30, 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, 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.

Long-term debt and current maturities of long-term debt, on an aggregate basis, increased from $325.6 million at December 31, 2024 to $331.2 million at June 30, 2025.

The increase was primarily related to the financing of additional revenue equipment during the first six months of 2025.

NEW ACCOUNTING PRONOUNCEMENTS

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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