What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-02-24 compared with 2024-02-23 · 198 added, 163 removed, 728 unchanged (33% of the section changed)

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This Annual Report on Form 10-K, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains these types of statements, which are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995.

Words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “may,” “plan,” “predict,” “believe,” “should” and similar words or expressions are intended to identify forward-looking statements.

Words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “may,” “plan,” “predict,” “believe,” “should,” “potential” and similar words or expressions are intended to identify forward-looking statements.

Investors should not place undue reliance on forward-looking statements, and the Company undertakes no obligation to publicly update or revise any forward-looking statements, except as otherwise required by applicable law.

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• cost and availability of qualified drivers, dock workers, mechanics and other employees, purchased transportation and fuel;

• inflationary increases in operating expenses and corresponding reductions of profitability;

• inflationary increases in expenses and corresponding reductions of profitability;

• cost and availability of diesel fuel and fuel surcharges;

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• costs and liabilities from the disruption in or failure of our technology or equipment essential to our operations, including as a result of cyber incidents, security breaches, malware or ransomware attacks;

• risks arising from remote work, including increased risk of related cybersecurity incidents;

• failure to keep pace with technological developments;

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• capacity and highway infrastructure constraints;

• risks arising from new or higher tariffs;

• risks arising from international business operations and relationships;

• seasonal factors, harsh weather and disasters caused by climate change;

• economic declines in the geographic regions or industries in which our customers operate;

• the creditworthiness of our customers and their ability to pay for services;

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• damage to our reputation from adverse publicity, including from the use of or impact from social media;

• failure to make future acquisitions or to achieve acquisition synergies;

• failure to achieve synergies and the disruption to our business due to acquisitions;

• the effect of litigation and class action lawsuits arising from the operation of our business, including the possibility of claims or judgments in excess of our insurance coverages or that result in increases in the cost of insurance coverage or that preclude us from obtaining adequate insurance coverage in the future;

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• unforeseen costs from new and existing data privacy laws;

• changes to the way LTL freight is categorized;

• costs from new and existing laws regarding how to classify workers;

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• international conflicts and geopolitical instability;

• increasing investor and customer sensitivity to social and sustainability issues, including climate change;

• evolving stakeholder expectations regarding environmental and social issues;

• provisions in our governing documents and Delaware law that may have anti-takeover effects;

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The Company’s business is highly correlated to non-service sectors of the general economy.

The Company’s strategy is to improve profitability by increasing yield while also increasing volumes.

The Company’s strategy is to improve profitability by increasing revenue per shipment while also increasing volumes.

Components of this strategy include building density in existing geography and pursuing geographic and terminal expansion in an effort to promote profitable growth and improve our customer value proposition over time.

The Company’s business is labor intensive, capital intensive and service sensitive.

The Company looks for opportunities to improve safety, cost effectiveness and asset utilization (primarily tractors and trailers).

Pricing initiatives have had a positive impact on yield and profitability.

The Company continues to execute targeted sales and marketing programs along with initiatives to align

costs with volumes and improve customer satisfaction.

The Company looks for opportunities to improve safety, cost

effectiveness and asset utilization (primarily tractors and trailers).

Pricing initiatives have had a positive impact on profitability.

The Company continues to execute targeted sales and marketing programs along with initiatives to align costs with volumes and improve customer satisfaction.

Technology continues to be an important investment as we work towards improving customer experience, operational efficiencies and Company image.

The Company’s operating revenue increased by 11.4 percent in 2024 compared to 2023.

The increase was due to increased yield, excluding fuel surcharges, as a result of pricing actions and changes in business mix, which included 6.5 and 7.5 percent general rate increases on January 30, 2023 and December 4, 2023, respectively, for customers subject to general rate increases.

The increase was a result of increased volume and pricing actions, which included 7.9, 7.5 and 6.5 percent general rate increases on October 21, 2024, December 4, 2023 and January 30, 2023, respectively, for customers subject to general rate increases.

Additionally, the Company experienced year over year increases in shipments and tonnage partially as a result of the redistribution of freight due to industry consolidation mid-year 2023.

These increases were offset by a decrease in fuel surcharge revenue, resulting from lower diesel fuel prices.

Consolidated operating income declined to $460.5 million for 2023 compared to $470.5 million in 2022.

The decrease in 2023 operating income resulted primarily from increases in salaries, wages and benefits and depreciation expense which was partially offset by increased revenue and decreased purchased transportation.

Consolidated operating income increased to $482.2 million for 2024 compared to $460.5 million in 2023.

The increase in 2024 operating income resulted primarily from increased volumes partially offset by increases in salaries, wages and benefits, including workers' compensation claims and related expense, and depreciation expense.

The Company generated $583.7 million in net cash provided by operating activities in 2024 versus $577.9 million in 2023.

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Saia is a transportation company headquartered in Johns Creek, Georgia that provides less-than-truckload (LTL) services through a single integrated organization.

While more than 97% of its revenue is derived from transporting LTL shipments across 45 states, the Company also offers customers a wide range of other value-added services, including non-asset truckload, expedited and logistics services across the United States.

While more than 97% of its revenue is derived from transporting LTL shipments across the United States, the Company also offers customers a wide range of other value-added services, including non-asset truckload, expedited and logistics services across North America.

Our business is highly correlated to non-service sectors of the general economy.

Our business also is impacted by a number of other factors as discussed under “Cautionary Note Regarding Forward-Looking Statements” and Part I, Item 1A., “Risk Factors.” The key factors that affect our operating results are the volumes of shipments transported through our network, as measured by our average daily shipments and tonnage;

the prices we obtain for our services, as measured by revenue per hundredweight (a measure of yield) and revenue per shipment;

the prices we obtain for our services, as measured by revenue per shipment and revenue per hundredweight (a measure of yield), whether including or excluding fuel surcharge revenue;

our ability to manage our cost structure for capital expenditures and operating expenses such as salaries, wages and benefits;

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Revenue and volume

Consolidated revenue increased 3.2 percent to $2.9 billion primarily due to increased volume and yield, excluding fuel surcharges.

These increases were the result of a redistribution of freight due to industry consolidation mid-year, as well as pricing actions and changes in business mix.

Improved customer service and targeted marketing initiatives have positively impacted the Company's ability to implement measured pricing actions to improve yield.

As a result of these increased rates, Saia’s LTL revenue per hundredweight (a measure of yield), excluding fuel surcharges, increased 6.9 percent to $20.99 for 2023.

Saia’s LTL tonnage also increased 1.3 percent while LTL shipments increased 3.9 percent for 2023.

Overall LTL revenue per shipment, excluding fuel surcharges, increased 4.2 percent in 2023 due to the yield improvements discussed above.

Consolidated revenue increased 11.4 percent to $3.2 billion primarily due to increased shipments and tonnage, partially as a result of a redistribution of freight due to a competitor bankruptcy in 2023.

Saia’s LTL tonnage increased 8.9 percent while LTL shipments increased 12.4 percent for 2024.

Overall LTL revenue per shipment, excluding fuel surcharges, increased 1.1 percent in 2024 as a result of pricing actions and changes in business mix.

For 2024 and 2023, approximately 75 percent of Saia’s operating revenue was subject to specific customer price adjustment negotiations that occur throughout the year.

The remaining 25 percent of operating revenue was subject to a general rate increase which is based on market conditions.

For customers subject to general rate increases, Saia implemented 6.5 and 7.5 percent general rate increases on January 30, 2023 and December 4, 2023, respectively.

For customers subject to general rate increases, Saia implemented 7.9, 7.5 and 6.5 percent general rate increases on October 21, 2024, December 4, 2023 and January 30, 2023, respectively.

Competitive factors, customer turnover and mix changes, among other things, impact the extent to which customer rate increases are retained over time.

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Operating expenses and margin

Consolidated operating income declined to $460.5 million in 2023 compared to $470.5 million in 2022.

Consolidated operating income increased to $482.2 million in 2024 compared to $460.5 million in 2023.

The increase in 2024 operating income resulted primarily from increased volumes which were partially offset by increases in salaries, wages and benefits, including workers' compensation claims and related expense, and depreciation expense.

The 2024 operating ratio (operating expenses divided by operating revenue) was 85.0 percent as compared to 84.0 percent in 2023.

Salaries, wages and employees’ benefits expense increased $131.7 million in 2023 compared to 2022 largely due to increased head count to support increased volumes, ongoing business growth and network expansion.

Additionally, in July 2023 the Company implemented a salary and wage increase of approximately 4.1 percent.

Purchased transportation expense decreased $77.2 million in 2023 compared to 2022 primarily due to both a decrease in miles utilized and a decrease in cost per mile.

Fuel, operating expenses and supplies increased by $5.2 million primarily driven by increased repairs, maintenance and facility costs in addition to investments in information technology network support.

These changes were partially offset by decreases in costs of fuel during the period.

In addition, claims and insurance expense in 2023 was $11.4 million higher than 2022 largely due to increased premiums, claim development and claim costs in 2023.

Salaries, wages and employees’ benefits expense increased $186.6 million in 2024 compared to 2023.

This increase was largely driven by increased head count to support increased volumes, ongoing business growth and network expansion, as well as, increased training hours and a Company-wide wage increase in July 2024 of approximately 4.1 percent, excluding executives.

In addition, other employee related costs increased, including an increase in the number and costs of workers' compensation claims and unfavorable development of historical claims.

Purchased transportation expense decreased $1.4 million in 2024 compared to 2023 primarily due to a decrease in cost per mile.

Fuel, operating expenses and supplies increased by $65.7 million primarily driven by increased facility costs and administrative costs related to increased volumes and expanded footprint.

Claims and insurance expense in 2024 was $9.7 million higher than 2023 largely due to increased auto liability and cargo claims activity and development of open claims.

The Company experiences volatility in accident expense from time to time as a result of utilizing self-insurance as a part of its risk management program.

Depreciation and amortization expense increased $31.3 million in 2024 compared to 2023 primarily due to ongoing investments in revenue equipment and network expansion.

Interest expense in 2023 was $0.1 million less than 2022 due to decreased finance lease obligations in 2023.

Interest income in 2023 was $6.0 million greater than 2022 due to increased interest rates on higher average deposit balances during the period.

The effective income tax rate was 23.9 percent and 23.6 percent for the years ended December 31, 2023 and 2022, respectively.

Interest expense in 2024 was $6.4 million greater than 2023 due to interest expense related to increased borrowings under the credit arrangements in 2024.

Interest income in 2024 was $5.2 million less than 2023 due to due to decreased deposit balances during the period.

The effective income tax rate was 23.9 percent for the years ended December 31, 2024 and 2023.

Our business remains highly correlated to non-service sectors of the general economy and competitive pricing pressures, as well as the success of Company-specific improvement initiatives.

Our outlook is dependent on a number of external factors, including strength of the economy, inflation, labor availability, diesel fuel prices and supply chain constraints.

Our outlook is dependent on a number of external factors, including strength of the economy, inflation, changes in regulatory conditions and international trade relations, including higher tariffs, labor availability, diesel fuel prices and supply chain constraints.

The potential impact of these factors on our operations, financial performance and financial condition, as well as the impact on our ability to successfully execute our business strategies and initiatives, remains uncertain and difficult to predict.

We are continuing initiatives to improve and enhance customer service in an effort to support our ongoing pricing and business mix optimization, while seeking to control costs and improve productivity.

Planned revenue initiatives include building density in our current geography, targeted marketing initiatives to grow revenue in more profitable areas, further expanding our geographic and terminal network, as well as pricing and yield management.

On January 30, 2023 and December 4, 2023 Saia implemented 6.5 and 7.5 percent general rate increases, respectively, for customers comprising approximately 25 percent of Saia’s operating revenue.

The extent of success of this revenue initiative is impacted by what proves to be the underlying economic trends, competitor initiatives and other factors discussed under “Cautionary Note Regarding Forward-Looking Statements” and Part I, Item 1A., “Risk Factors.”

Effective July 2023, the Company implemented a salary and wage increase of approximately 4.1 percent for all of its employees, other than executives.

Planned revenue initiatives include building density in our current geography, targeted marketing initiatives to grow revenue in more profitable areas and further expanding our geographic and terminal network.

On October 21, 2024, Saia implemented a 7.9 percent general rate increases for customers comprising approximately 25 percent of Saia’s operating revenue.

The success of these revenue initiatives is impacted by what proves to be the underlying economic trends, competitor initiatives and other factors discussed under “Cautionary Note Regarding Forward-Looking Statements” and Part I, Item 1A., “Risk Factors.”

Effective July 2024, the Company implemented a salary and wage increase of approximately 4.1 percent for all of its employees, excluding executives.

The total cost of the compensation increase is expected to be approximately $59.0 million annually, and the Company anticipates the impact will be partially offset by productivity and efficiency gains.

If the Company builds market share, including through its geographic and terminal expansion, it expects there to be numerous operating leverage cost benefits.

Conversely, should the economy soften, the Company plans to match resources and capacity to shifting volume levels to lessen unfavorable operating leverage.

The strategic objective of the Company is to build market share through excellent customer service, continued operating efficiencies and through its geographic and terminal expansion which should result in numerous operating leverage cost benefits.

However, should the economy soften, the Company plans to match resources and capacity to shifting volume levels to lessen unfavorable operating leverage.

The success of cost improvement initiatives is impacted by a number of factors, including the cost and availability of drivers, dock workers and personnel, and purchased transportation, diesel fuel and insurance costs and inflation.

See “Cautionary Note Regarding Forward-Looking Statements” and Part I, Item 1A., “Risk Factors,” for a more complete discussion of potential risks and uncertainties that could materially adversely affect our financial condition, results of operation, cash flows and prospects.

Recently Issued Accounting Pronouncements

Recent Accounting Pronouncements Adopted in 2024

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

2023-07, “ Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures .” Under this ASU, interim and annual segment disclosures are expanded primarily through enhanced disclosures about significant segment expenses and information used to assess segment performance.

Additionally, the standard requires all entities with a single reportable segment to apply all segment disclosure requirements.

This standard is effective for annual reporting periods beginning after December 15, 2023 and interim reporting periods beginning after December 15, 2024.

The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures.

Improvements to Reportable Segment Disclosures.

” The standard requires all entities with a single reportable segment to apply all segment disclosure requirements.

This standard became effective for annual reporting periods beginning after December 15, 2023 and interim reporting periods beginning after December 15, 2024.

The Company adopted the standard on a retrospective basis for the 2024 annual reporting period with the impact limited to incremental disclosures in our consolidated financial statements.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU No.

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The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU No.

2024-03, "Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses." Under this ASU, entities are required to disclose additional disaggregated information related to certain expense captions included in the Consolidated Statements of Operations.

This standard is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.

The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures.

Financial Condition, Liquidity and Capital Resources

The Company's liquidity needs arise primarily from capital investment in new equipment, land and structures, information technology and letters of credit required under insurance programs, as well as funding working capital requirements.

The Company's liquidity needs arise primarily from capital investment in new equipment, land and structures, information technology and letters of credit and surety bonds required under insurance programs, as well as funding working capital requirements.

Working Capital and Capital Expenditures

Working capital at December 31, 2024 was $157.4 million compared to $326.6 million at December 31, 2023.

This increase is primarily due to an increase in cash and cash equivalents and accounts receivable, partially offset by an increase in accounts payable.

This decrease is primarily due to a decrease in cash and cash equivalents of $276.7 million to fund the Yellow Corporation real estate acquisitions and additional revenue equipment used to support higher volumes and expanded footprint, partially offset by an increase in income taxes receivable and decreases in accounts payable and wages, vacation and employees' benefits.

A summary of our cash flows is presented below:

(in thousands)

Cash and Cash Equivalents, beginning of period

Cash and cash equivalents, beginning of year

Net Cash flows provided by (used in):

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Financing activities

Net Increase in Cash and Cash Equivalents

Cash and Cash Equivalents, end of period

Cash flows from operating activities were $577.9 million for 2023 versus $473.0 million for 2022 largely driven by changes in net operating assets and liabilities.

For 2023, net cash used in investing activities was $448.7 million versus $365.5 million in 2022 primarily due to increased capital expenditures during 2023 as the Company continues to expand its footprint and add density in markets.

Net cash used in financing activities was $20.4 million in 2023 versus $26.7 million in 2022 as a result of decreased finance lease payments during 2023.

Net Increase (Decrease) in Cash and Cash Equivalents

Cash and cash equivalents, end of year

Cash flows from operating activities were $583.7 million for 2024 versus $577.9 million for 2023 largely driven by increased depreciation and amortization and deferred income taxes, partially offset by changes in other assets and liabilities.

For 2024, net cash used in investing activities was $1,035.9 million versus $448.7 million in 2023 primarily due to the acquisition of terminals from Yellow Corporation in January 2024 in addition to increased purchases of revenue equipment to support higher volumes and expanded footprint.

Net cash used in financing activities was $175.4 million in 2024 versus $20.4 million in 2023 as a result of borrowings to fund capital expenditures during 2024.

The Company has historically generated cash flows from operations to fund a large portion of its capital expenditure requirements.

The timing of capital expenditures can largely be managed around the seasonal working capital requirements of the Company.

The Company believes it has adequate sources of capital to meet short-term liquidity needs through its cash on hand and its operating cash flows.

Additionally, as of December 31, 2023, the Company has $267.9 million of availability under its 2023 Credit Agreement, $100 million of committed financing and $250 million of uncommitted financing under the Company's Private Shelf Agreement, subject to certain conditions.

The Company believes it has adequate sources of capital to meet short-term liquidity needs through its cash on hand, operating cash flows and availability under its credit arrangements.

As of December 31, 2024, the Company has $473.8 million of availability under its Revolving Credit Facility and $250 million of uncommitted financing under the Company's Private Shelf Agreement, subject to certain conditions.

Future operating cash flows are primarily dependent upon the Company’s profitability and its ability to manage its working capital requirements, primarily accounts receivable, accounts payable and wage and benefit accruals.

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Net capital expenditures pertain primarily to investments in tractors and trailers and other revenue equipment, information technology, land and structures.

Projected net capital expenditures for 2024 are expected to be approximately $1 billion compared to 2023 net capital expenditures of $437.2 million.

Estimated 2024 capital expenditures include $235.7 million to acquire Yellow Corporation terminals, a normal replacement cycle of revenue equipment and technology investments for our operations, and additional revenue equipment and real estate investments to support our growth initiatives.

Projected net capital expenditures for 2025 are expected to be over $700 million compared to 2024 net capital expenditures of $1.0 billion.

Estimated 2025 capital expenditures include a normal replacement cycle of revenue equipment and technology investments for our operations, and additional revenue equipment and real estate investments to support our growth initiatives.

See “Cautionary Note Regarding Forward-Looking Statements” and Item 1A., “Risk Factors,” for a more complete discussion of potential risks and uncertainties that could materially affect our future performance and financial condition.

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In addition to the amounts disclosed in the table above, the Company had an additional $24.4 million in capital expenditures for revenue equipment that was received but not paid for prior to December 31, 2024.

Credit Agreements

At December 31, 2022 the Company was party to a credit agreement with a banking group that provided for a $300 million line of credit with a term ending February 2024.

This credit agreement also had an accordion feature that allowed for an additional $100 million availability, subject to certain conditions and availability of lender commitments.

This credit agreement provided for a pledge by the Company of certain land and structures, accounts receivable and other assets to secure indebtedness under this agreement.

On February 3, 2023, the Company entered into a new unsecured credit agreement with a banking group (the 2023 Credit Agreement) and terminated its previous credit agreement.

The 2023 Credit Agreement maintains the amount of the previous line of credit of $300 million and extends the term until February 2028.

The 2023 Credit Agreement contains an accordion feature that allows the Company to increase the size of the facility by up to $150 million, subject to certain conditions and availability of lender commitments.

Borrowings under the 2023 Credit Agreement bear interest at the Company’s election at a variable rate equal to (a) one, three or six month term SOFR (the forward-looking secured overnight financing rate) plus 0.10%, or (b) an alternate base rate, in each case plus an applicable margin.

The applicable margin will be between 1.00% and 1.75% per annum for term SOFR loans and between 0.00% and 0.75% per annum for alternate base rate loans, in each case based on the Company’s consolidated net lease adjusted leverage ratio.

The Company also accrues fees based on the daily unused portion of the credit facility, which will be between 0.0125% and 0.025% based on the Company’s consolidated net lease adjusted leverage ratio.

Under the 2023 Credit Agreement, the Company is subject to a maximum consolidated net lease adjusted leverage ratio of less than 3.50 to 1.00 with the potential to be temporarily increased in the event the Company makes an acquisition that meets certain criteria.

The 2023 Credit Agreement contains certain customary representations and warranties, affirmative and negative covenants and provisions relating to events of default.

Under the 2023 Credit Agreement, if an event of default occurs, the banks will be entitled to take various actions, including the acceleration of amounts due.

At December 31, 2023 and 2022, the Company had no outstanding borrowings and outstanding letters of credit of $32.1 million and $31.2 million, respectively, under the credit agreements.

See Note 2 of the accompanying audited Consolidated Financial Statements for more information on the credit agreements.

Credit Arrangements

Revolving Credit Facility

The Company is a party to an unsecured credit agreement with its banking group (the Revolving Credit Facility).

On December 9, 2024, the Company entered into an amendment to the Revolving Credit Facility.

The amendment increased commitments under the Revolving Credit Facility by $300 million to an aggregate commitment of $600 million and expanded the accordion feature, subject to certain conditions and availability of lender commitments, from $150 million to $300 million.

This amendment also extended the maturity date of the Revolving Credit Facility from February 3, 2028, to December 9, 2029.

Borrowings under the Revolving Credit Facility bear interest at the Company’s election at a variable rate equal to (a) one, three or six month term SOFR (the forward-looking secured overnight financing rate) plus 0.10%, or (b) an alternate base rate, in each case plus an applicable margin.

Additionally, the amendment adjusted the applicable margin such that the applicable margin is now between 1.25% and 2.00% per annum for term SOFR loans and between 0.25% and 1.00% per annum for alternate base rate loans, in each case based on the Company’s consolidated net lease adjusted leverage ratio.

The amendment also modified the fees that the Company accrues based on the daily unused portion of the credit facility, which will now range between 0.175% and 0.30% based on the Company’s consolidated net lease adjusted leverage ratio.

The Revolving Credit Facility contains certain customary representations and warranties, affirmative and negative covenants and provisions relating to events of default.

Under the Revolving Credit Facility, if an event of default occurs, the banks will be entitled to take various actions, including the acceleration of amounts due.

Under the Revolving Credit Facility, the Company is subject to a maximum consolidated net lease adjusted leverage ratio of less than 3.50 to 1.00 with the potential to be temporarily increased in the event the Company makes an acquisition that meets certain criteria.

The Company was in compliance with its debt covenants under the Revolving Credit Facility at December 31, 2024.

At December 31, 2024, the Company had outstanding borrowings of $94.0 million and outstanding letters of credit of $32.2 million under the Revolving Credit Facility.

At December 31, 2023, the Company had no outstanding borrowings and outstanding letters of credit of $32.1 million under the Revolving Credit Facility.

See Note 2, "Debt and Financing Arrangements" of the accompanying audited Consolidated Financial Statements for more information on the Revolving Credit Facility.

Private Shelf Agreement

On November 9, 2023, the Company entered into a $350 million uncommitted Private Shelf Agreement (the Shelf Agreement), by and among the Company, PGIM, Inc.

On November 9, 2023, the Company entered into a $350 million uncommitted Private Shelf Agreement (the Shelf Agreement), with PGIM, Inc.

(Prudential), and certain affiliates and managed accounts of Prudential (the Note Purchasers) which allows the Company, from time to time, to offer for sale to Prudential and its affiliates, in one or a series of transactions, senior notes of the Company, through November 9, 2026.

Pursuant to the Shelf Agreement, the Company agreed to sell up to $100 million aggregate principal amount of senior notes (the Initial Notes) to the Note Purchasers.

The Initial Notes will bear interest at 6.09% per annum and will mature five years after the date on which the Initial Notes are issued, unless repaid earlier by the Company.

The funding date for the Initial Notes may occur at any time on or prior to August 2, 2024.

The Initial Notes will be senior unsecured obligations and rank pari passu with borrowings under the 2023 Credit Agreement or other senior promissory notes issued pursuant to the Shelf Agreement.

Pursuant to the Shelf Agreement, on May 1, 2024, the Company issued senior promissory notes (the Initial Notes) in an aggregate principal amount of $100 million to the Note Purchasers.

The Initial Notes bear interest at 6.09% per annum and mature on May 1, 2029, unless repaid earlier by the Company.

The Initial Notes are senior unsecured obligations and rank pari passu with borrowings under the Revolving Credit Facility or other senior promissory notes issued pursuant to the Shelf Agreement.

Additional notes issued under the Shelf Agreement, if any, would bear interest at a rate per annum, and would have such other terms, as would be set forth in a confirmation of acceptance executed by the parties prior to the closing of the applicable sale transaction.

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Upon the occurrence and continuance of an event of default, the holders of notes issued under the Shelf Agreement may require immediate payment of all amounts owing under such notes.

At December 31, 2023, the Company had no outstanding borrowings under its Shelf Agreement.

See Note 2 of the accompanying audited Consolidated Financial Statements for more information on the Shelf Agreement.

The Company was in compliance with its debt covenants under the Shelf Agreement at December 31, 2024.

At December 31, 2024 and 2023, the Company had outstanding notes under the Shelf Agreement of $100.0 million and $0, respectively.

See Note 2, "Debt and Financing Arrangements" of the accompanying audited Consolidated Financial Statements for more information on the Shelf Agreement.

Finance Leases

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Contractual Obligations

Contractual obligations for the Company are comprised of lease agreements, purchase obligations and long-term debt obligations related to any outstanding balance under the Company’s 2023 Credit Agreement or Shelf Agreement.

Contractual obligations for the Company are comprised of lease agreements, purchase obligations and long-term debt obligations related to any outstanding balance under the credit arrangements.

Total contractual obligations for operating leases at December 31, 2024 totaled $147.3 million.

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Purchase obligations at December 31, 2024 were $27.7 million.

As of December 31, 2023 there was no outstanding principal balance under the 2023 Credit Agreement or Shelf Agreement.

For further information see the Notes to the accompanying audited Consolidated Financial Statements in this Form 10-K.

As of December 31, 2024 the Revolving Credit Facility had $94.0 million outstanding principal balance and the Shelf Agreement had $100.0 million outstanding principal balance.

See Note 2, "Debt and Financing Arrangements" of the accompanying audited Consolidated Financial Statements for more information on the credit arrangements.

Other commercial commitments of the Company typically include letters of credit and surety bonds required for collateral under insurance agreements.

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Accruals are calculated on reported claims based on an evaluation of the nature and severity of the claim, historical loss experience and on legal, economic and other factors.

Actuarial analysis is also used in calculating the accrual for workers’ compensation and bodily injury and property damage claims.

Actuarial analysis is also used in calculating the accruals for workers’ compensation and bodily injury and property damage claims.

o Sensitivity of Estimate to Change :

These accruals could be significantly affected if the actual costs of these claims differ from the estimates and assumptions used to establish the accruals.

A significant number of these claims typically take several years to develop and even longer to ultimately settle.

significant number of these claims typically take several years to develop and even longer to ultimately settle.

These accruals have been reasonably accurate over time;

however, changes to

estimates and assumptions regarding severity of claims, medical cost inflation, as well as specific case facts can create short-term volatility in these accruals.

however, changes to estimates and assumptions regarding severity of claims, medical cost inflation, as well as specific case facts can create short-term volatility in these accruals.

A 100 basis point change in our loss development factors would result in an immaterial change in the claims and insurance accruals.

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Estimates for credit losses and billing adjustments are based upon historical experience.

Billing adjustments are primarily made for discounts and billing corrections.

o Sensitivity of Estimate to Change :

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o Judgments and Uncertainties :

Selecting the appropriate accounting method for depreciation requires management judgment, as there are multiple acceptable methods that are in accordance with U.S generally accepted accounting principles, including straight-line, declining-balance, and sum-of-the-years' digits.

Selecting the appropriate accounting method for depreciation requires management judgment, as there are multiple acceptable methods that are in accordance with U.S.

generally accepted accounting principles, including straight-line, declining-balance, and sum-of-the-years' digits.

The Company depreciates property and equipment on straight-line and declining-balance bases over the estimated useful lives of the assets.

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Actual useful lives and residual values could differ from these assumptions based on market conditions and other factors, thereby impacting the estimated amount or timing of depreciation expense.

There have been no material effects of changes to judgments related to depreciation expense for the year ended December 31, 2023.

See Note 1, "Description of Business and Summary of Accounting Policies" of the accompanying audited Consolidated Financial Statements, for discussion of the effects of changes to judgments related to depreciation expense for the year ended December 31, 2024.

These accounting policies and others are described in further detail in the Notes to the audited Consolidated Financial Statements included in this Form 10-K.

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In many cases, there are alternative policies or estimation techniques that could be used.

We maintain a thorough process to review the application of our accounting policies and to evaluate the appropriateness of the many estimates that are required to prepare the consolidated financial statements.

We maintain a thorough process to review the application of our accounting policies and to evaluate the appropriateness of the many estimates that are required to prepare the consolidated

financial statements.

However, even under optimal circumstances, estimates routinely require adjustment based on changing circumstances and the receipt of new or better information.

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The following table provides information about the Company’s debt as of December 31, 2024.

The table presents cash flows for principal payments (in millions) and related weighted average interest rates by contractual maturity dates.

The estimated fair value of the fixed rate debt (in millions), which is comprised of finance leases, is based on current market interest rates for similar types of financial instruments, reflective of level two inputs.

Expected maturity date

The table presents annual principal cash flows (in millions) and related weighted average interest rates by contractual maturity dates.

The fair value of fixed rate debt is based on current market interest rates for similar types of financial instruments, reflective of level two inputs.

The carrying amount of the Company’s variable rate debt approximates fair value as interest rates approximate the current rates available to the Company.

As of December 31, 2024

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Average interest rate

Variable rate debt

Average interest rate

Financial Statemen ts and Supplementary Data

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These liabilities are recorded within claims and insurance accruals (current) of $43.1 million, and claims, insurance, and other (non-current) of $66.4 million, as of December 31, 2024.

We identified the evaluation of the estimated liabilities for self-insured workers’ compensation and bodily injury claims as a critical audit matter because of the inherent uncertainty in the amounts that will ultimately be paid to settle these claims.

Factors that may affect the settlement cost of claims include the length of time the

claim remains open, its potential severity, and the results of litigation.

We identified the evaluation of the estimated liabilities for self-insured workers’ compensation and bodily

injury claims as a critical audit matter because of the inherent uncertainty in the amounts that will ultimately be paid to settle these claims.

Factors that may affect the settlement cost of claims include the length of time the claim remains open, its potential severity, and the results of litigation.

Additionally, the Company’s liabilities include estimates for future development of claims and specialized skills were needed to evaluate the actuarial methods and assumptions used to make these estimates.

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Depreciation and amortization

Operating losses (gains), net

Operating losses, net

Total operating expenses

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Deferred income taxes

Loss (gain) from property disposals, net

Loss from property disposals, net

Stock-based compensation

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Acquisition of property and equipment

( 1,043,557 )

Proceeds from disposal of property and equipment

Net cash used in investing activities

( 1,035,864 )

Financing Activities:

Repayment of credit and private shelf agreements

Borrowing of credit and private shelf agreements

Repayments of revolving credit facility

( 1,060,100 )

Borrowings of revolving credit facility

Borrowings on private shelf agreement

Proceeds from stock option exercises

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Other financing activity

Net cash used in financing activities

Net Increase in Cash and Cash Equivalents

Net cash (used in) provided by financing activities

Net Increase (Decrease) in Cash and Cash Equivalents

Cash and cash equivalents, beginning of year

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Saia is a leading, less-than-truckload (LTL) motor carrier with more than 97 % of its revenue derived from transporting LTL shipments for customers.

In addition to the core LTL services provided in 45 states, the Company also offers customers a wide range of other value-added services, including non-asset truckload, expedited transportation and logistics services across the United States.

The chief operating decision maker is the Chief Executive Officer who regularly reviews the operating results of the Company's single operating segment.

In addition to the core LTL services provided in the United States, the Company also offers customers a wide range of other value-added services, including non-asset truckload, expedited transportation and logistics services across North America.

Basis of Presentation

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and impairment assessments on long-lived assets and goodwill.

Recently Issued Accounting Pronouncements

Recent Accounting Pronouncements Adopted in 2024

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

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Improvements to Reportable Segment Disclosures.

” Under this ASU, interim and annual segment disclosures are expanded primarily through enhanced disclosures about significant segment expenses and information used to assess segment performance.

Additionally, the standard requires all entities with a single reportable segment to apply all segment disclosure requirements.

This standard is effective for annual reporting periods beginning after December 15, 2023 and interim reporting periods beginning after December 15, 2024.

The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures.

” The standard requires all entities with a single reportable segment to apply all segment disclosure requirements.

This standard became effective for annual reporting periods beginning after December 15, 2023 and interim reporting periods beginning after December 15, 2024.

The Company adopted the standard on a retrospective basis for the 2024 annual reporting period with the impact limited to incremental disclosures in our consolidated financial statements.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU No.

2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

” Under this ASU income tax disclosures are expanded primarily by requiring the disaggregation of the rate reconciliation and income taxes paid disclosures.

Improvements to Income Tax Disclosures.” Under this ASU, income tax disclosures are expanded primarily by requiring the disaggregation of the rate reconciliation and income taxes paid disclosures.

This standard is effective for annual reporting periods beginning after December 15, 2024.

The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU No.

2024-03, "Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

This standard is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.

The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures.

Summary of Accounting Policies

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Depreciation and amortization expense (including amortization of assets under finance leases) was $ 209.2 million, $ 177.9 million and $ 156.2 million for the years ended December 31, 2024, 2023 and 2022, respectively.

At December 31, 2023, trailers acquired under finance leases had a gross carrying value of $ 137.4 million and accumulated amortization of $ 67.7 million.

At December 31, 2022, trailers acquired under finance leases had a gross carrying value of $ 137.9 million and accumulated amortization of $ 58.7 million.

The Company periodically evaluates estimated useful lives of property and equipment considering its planned and actual usage, planned and actual maintenance and replacement, and other relevant physical and economic factors that may affect our use of the assets.

During the second quarter of 2024, the Company determined that the estimated useful lives of certain of its trailers and dollies should be extended from 14 years to 20 years.

This change was recognized prospectively.

The changes in estimates resulted in an increase in income from continuing operations of approximately $ 7.7 million (a $ 5.8 mil lion increase in net income) for the year ended December 31, 2024.

Claims and Insurance Accruals:

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Stock options granted to employees are valued using a Black-Scholes-Merton model with the expense amortized over the three-year vesting period.

Restricted stock is valued based on the fair market value of the Company's common stock at the date of grant and the expense is amortized over the three to five year vesting period.

Restricted stock is valued based on the fair market value of the Company's common stock at the date of grant and the expense is amortized over the three to five

year vesting period.

Stock-based performance unit awards are valued using a Monte Carlo model and the expense is amortized over the three-year vesting period.

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See Note 2 for fair value disclosures related to debt.

Segment Reporting:

Saia is comprised of a single reportable segment organized around its transportation services.

The segment provides core LTL and a wide range of other value-add transportation services to its customers based on negotiated prices contained in either a transportation services agreement or a publicly disclosed tariff rate.

Saia derives revenue primarily in the United States and manages its business activities on a consolidated basis using an integrated transportation network.

The chief operating decision maker (CODM) is the Chief Executive Officer who regularly reviews the operating results of the Company's single operating segment at the consolidated company level.

The accounting policies of the segment are the same as those described in the summary of significant accounting policies.

The CODM assesses performance for the segment and determines how to allocate resources based on Saia's consolidated net income.

The CODM uses net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the Company or for other purposes, such as for acquisitions, to repay borrowings or to pay dividends.

The CODM also uses net income to monitor budget versus actual results, and in competitive analysis by benchmarking to the Company’s competitors.

The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the Company and in establishing management’s compensation.

The measure of segment assets is reported on the balance sheet as total consolidated assets.

The following table presents selected financial information with respect to the Company’s single reportable segment (in thousands):

For The Years Ended December 31,

Purchased Transportation

Other Segment items (b)

Depreciation and Amortization

Interest Expense

Interest Income

Income Tax Expense

Segment and Consolidated Net Income

(a) Wages includes payroll costs for non-management employees generally paid on an hourly or per-mile basis.

Salaries includes payroll costs for exempt employees.

(b) Other segment items include employees' benefits, fuel, operating expenses and supplies, operating taxes and licenses and claims and insurance.

Debt and Financing Arrangements

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December 31, 2023

Credit and Private Shelf Agreements, described below

Credit Arrangements, described below

Finance Leases, described below

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Long-term debt, less current portion

The Company is party to a credit agreement with a group of banks as well as a private shelf debt agreement to fund capital investments, letters of credit and working capital needs.

Credit Agreements

At December 31, 2022 the Company was party to a credit agreement with a banking group that provided for a $ 300 million line of credit with a term ending February 2024 .

This credit agreement also had an accordion feature that allowed for an additional $ 100 million availability, subject to certain conditions and availability of lender commitments.

This credit agreement provided for a pledge by the Company of certain land and structures, accounts receivable and other assets to secure indebtedness under this agreement.

On February 3, 2023, the Company entered into a new unsecured credit agreement with a banking group (the 2023 Credit Agreement) and terminated its previous credit agreement.

The 2023 Credit Agreement maintains the amount of the previous line of credit of $ 300 million and extends the term until February 2028.

The 2023 Credit Agreement contains an accordion feature that allows the Company to increase the size of the facility by up to $ 150 million, subject to certain conditions and availability of lender commitments.

Borrowings under the 2023 Credit Agreement bear interest at the Company’s election at a variable rate equal to (a) one, three or six month term SOFR (the forward-looking secured overnight financing rate) plus 0.10 %, or (b) an alternate base rate, in each case plus an applicable margin.

The applicable margin will be between 1.00 % and 1.75 % per annum for term SOFR loans and between 0.00 % and 0.75 % per annum for alternate base rate loans, in each case based on the Company’s consolidated net lease adjusted leverage ratio.

The Company also accrues fees based on the daily unused portion of the credit facility, which will be between 0.0125 % and 0.025 % based on the Company’s consolidated net lease adjusted leverage ratio.

The 2023 Credit Agreement contains certain customary representations and warranties, affirmative and negative covenants and provisions relating to events of default.

Under the 2023 Credit Agreement, if an event of default occurs, the banks will be entitled to take various actions, including the acceleration of amounts due.

At December 31, 2023 and 2022, the Company had no outstanding borrowings and outstanding letters of credit of $ 32.1 million and $ 31.2 million, respectively, under the credit agreements.

Credit Arrangements

Revolving Credit Facility

The Company is a party to an unsecured credit agreement with its banking group (the Revolving Credit Facility).

On December 9, 2024, the Company entered into an amendment to the Revolving Credit Facility.

The amendment increased commitments under the Revolving Credit Facility by $ 300 million to an aggregate commitment of $ 600 million and expanded the accordion feature, subject to certain conditions and availability of lender commitments, from $ 150 million to $ 300 million.

This amendment also extended the maturity date of the Revolving Credit Facility from February 3, 2028, to December 9, 2029.

Borrowings under the Revolving Credit Facility bear interest at the Company’s election at a variable rate equal to (a) one, three or six month term SOFR (the forward-looking secured overnight financing rate) plus 0.10 %, or (b) an alternate base rate, in each case plus an applicable margin.

Additionally,

the amendment adjusts the applicable margin such that the applicable margin is now between 1.25 % and 2.00 % per annum for term SOFR loans and between 0.25 % and 1.00 % per annum for alternate base rate loans, in each case based on the Company’s consolidated net lease adjusted leverage ratio.

The amendment also modifies the fees that the Company accrues based on the daily unused portion of the credit facility, which will now range between 0.175 % and 0.30 % based on the Company’s consolidated net lease adjusted leverage ratio.

The Revolving Credit Facility contains certain customary representations and warranties, affirmative and negative covenants and provisions relating to events of default.

Under the Revolving Credit Facility, if an event of default occurs, the banks will be entitled to take various actions, including the acceleration of amounts due.

The Company was in compliance with its debt covenants under the Revolving Credit Facility at December 31, 2024

At December 31, 2024, the Company had outstanding borrowings of $ 94.0 million and outstanding letters of credit of $ 32.2 million under the Revolving Credit Facility.

At December 31, 2023 , the Company had no outstanding borrowings and outstanding letters of credit of $ 32.1 million under the Revolving Credit Facility.

The carrying amount of the Company’s variable rate debt approximates fair value as interest rates approximate the current rates available to the Company.

Private Shelf Agreement

On November 9, 2023, the Company entered into a $ 350 million uncommitted Private Shelf Agreement (the Shelf Agreement), by and among the Company, PGIM, Inc.

On November 9, 2023, the Company entered into a $ 350 million uncommitted Private Shelf Agreement (the Shelf Agreement), with PGIM, Inc.

Pursuant to the Shelf Agreement, the Company agreed to sell up to $ 100 million aggregate principal amount of senior notes (the Initial Notes) to the Note Purchasers.

The Initial Notes will bear interest at 6.09 % per annum and will mature five years after the date on which the Initial Notes are issued, unless repaid earlier by the Company.

The funding date for the Initial Notes may occur at any time on or prior to August 2, 2024.

The Initial Notes will be senior unsecured obligations and rank pari passu with borrowings under the 2023 Credit Agreement or other senior promissory notes issued pursuant to the Shelf Agreement.

Pursuant to the Shelf Agreement, on May 1, 2024, the Company issued senior promissory notes (the Initial Notes) in an aggregate principal amount of $ 100 million to the Note Purchasers.

The Initial Notes bear interest at 6.09 % per annum and mature on May 1, 2029, unless repaid earlier by the Company.

The Initial Notes are senior unsecured obligations and rank pari passu with borrowings under the Revolving Credit Facility or other senior promissory notes issued pursuant to the Shelf Agreement.

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Upon the occurrence and continuance of an event of default, the holders of notes issued under the Shelf Agreement may require immediate payment of all amounts owing under such notes.

At December 31, 2023 , the Company had no outstanding borrowings under the Shelf Agreement.

The Company was in compliance with its debt covenants under the Shelf Agreement at December 31, 2024.

At December 31, 2024 and 2023, the Company had outstanding notes under the Shelf Agreement of $ 100.0 million and $ 0 , respectively.

The estimated fair value of these notes approximates book value for each year.

Finance Leases

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Management expects that in the normal course of business, leases will be renewed or replaced as they expire.

Finance and operating leases are discussed further in Note 4.

Finance and operating leases are discussed further in Note 4, "Leases."

Purchase commitments related to capital expenditures were $ 27.6 million at December 31, 2024.

These commitments include a commitment to purchase 17 terminals from Yellow Corporation for $ 235.7 million.

In addition to this, the Company was committed to a purchase price of $ 7.9 million related to the acquisition of 11 terminal leases.

See Note 12 for additional information on these transactions.

As of December 31, 2024 and 2023, the Company had $ 24.4 million and $ 50.9 million, respectively, of capital expenditures accrued for in accounts payable.

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Right-of-use assets obtained in exchange for new operating lease liabilities

The discount rate used in the Company's calculation of its right-of-use assets and corresponding lease liabilities was determined based on the stated rate within each contract when available, or its incremental borrowing rate, which approximates the rate at which the Company could borrow, on a collateralized basis, over the term of a lease.

The discount rate used in the Company's calculation of its right-of-use assets and corresponding lease liabilities was determined based on the rate implicit in the lease if readily determinable, or its incremental borrowing rate, which approximates the rate at which the Company could borrow, on a collateralized basis, over the term of a lease.

Supplemental cash flow and balance sheet information related to leases was as follows (in thousands, except where noted):

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Diluted Earnings Per Share

In 2023, there were 5,790 anti-dilutive options or restricted stock.

In 2022, there were 22,237 anti-dilutive options or restricted stock.

In 2021 , there were 19,386 anti-dilutive options or restricted stock.

In 2024, there were 50 anti-dilutive share-based awards.

In 2023, there were 5,790 anti-dilutive share-based awards.

In 2022 , there were 22,237 anti-dilutive share-based awards.

Stockholders’ Equity

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The Capital Accumulation Plan allows for the plan participants to invest in the Company’s common stock.

Elections to invest in the Company’s common stock are irrevocable, and upon distribution, the funds invested in the Company’s common stock are paid out in Company common stock rather than cash.

At December 31, 2023 and 2022, the Company’s rabbi trust, which holds the investments for the Capital

Accumulation Plan, held 69,672 and 69,982 shares of the Company’s common stock, respectively, all of which were purchased on the open market.

The following table summarizes the shares of the Company’s common stock that were purchased and sold by the Company’s rabbi trust:

Elections to invest in the Company’s common stock are irrevocable, and upon distribution, the funds invested in the Company’s common stock are paid out in Company common stock rather than

At December 31, 2024 and 2023, the Company’s rabbi trust, which holds the investments for the Capital Accumulation Plan, held 70,100 and 69,672 shares of the Company’s common stock, respectively, all of which were purchased on the open market.

The following table summarizes the shares of the Company’s common stock that were purchased and sold by the Company’s rabbi trust (in thousands except share amounts):

For The Years Ended December 31,

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Such deferrals are converted into units equivalent to the value of the Company’s stock.

Upon the director’s termination, death or disability, accumulated deferrals are distributed in the form of Company common stock.

Upon the director’s termination, death or disability, accumulated deferrals are distributed in the form of Company common stock in accordance with elections made by the directors.

The Company had 101,951 and 100,110 shares reserved for issuance under the Directors’ Deferred Fee Plan at December 31, 2024 and 2023 , respectively.

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Stock option awards granted to employees under the plans to date are non-qualified stock options, have vesting over three years , subject to earlier vesting upon a change of control and certain other events, and have a seven-year contractual term.

All outstanding stock options held by non-employee directors were granted to the director while employed by Saia, and tota l 10,000 shares as of December 31, 2023.

The Company grants shares of restricted stock as part of its long-term incentive plan.

These shares of restricted stock vest over three years , subject to earlier vesting upon a change in control.

These shares of restricted stock generally vest over three years , subject to earlier vesting upon a change of control and certain other events.

The value of restricted stock is based on the fair market value of the Company’s common stock at the date of grant.

In addition, the Company has periodically granted shares of restricted stock to certain key executives that vests 25 % after three years , 25 % after four

years and the remaining 50 % after five years , assuming the executive has been in continuous service to the Company since the award date, subject to earlier vesting upon a change in control.

addition, the Company has periodically granted shares of restricted stock to certain key executives that vests 25 % after three years , 25 % after four years and the remaining 50 % after five years , assuming the executive has been in continuous service to the Company since the award date, subject to earlier vesting upon a change of control and certain other events.

Stock option and restricted stock compensation expense of $ 7.5 million, $ 5.7 million and $ 3.9 million, was recorded for the years ended December 31, 2024, 2023 and 2022, respectively, and is included in salaries, wages and employees’ benefits.

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The total intrinsic value of options exercised during the years ended December 31, 2024, 2023 and 2022 was $ 8.3 million, $ 7.0 million, and $ 10.8 million, respectively.

The weighted-average grant-date fair value per share of options granted during the years ended December 31, 2022 and 2021 was $ 94.36 , and $ 62.65 , respectively.

There were no options granted during the year ended December 31, 2023.

The following table summarizes the weighted average assumptions used in valuing options for the years ended December 31, 2022 and 2021:

The weighted-average grant-date fair value per share of options granted during the year ended December 31, 2022 was $ 94.36 .

There were no options granted during the years ended December 31, 2024 and 2023.

The following table summarizes the weighted average assumptions used in valuing options for the year ended December 31, 2022:

Risk-free interest rate

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The criteria for payout of the awards is based on a comparison over the three-year performance period of these awards of the total stockholder return (TSR) of the Company’s common stock compared to the TSR of the companies in a peer group established by the Compensation Committee.

The stock-based awards are accounted for in accordance with ASC Topic 718 with the expense amortized over the three-year vesting period based on the fair value of the awards at the grant date using the Monte Carlo method.

These stock-based awards are accounted for in accordance with ASC Topic 718 with the expense amortized over the three-year vesting period based on the fair value of the awards at the grant date measured using the Monte Carlo method.

Operating results include expense for the performance unit awards of $ 5.3 million in 2024, $ 4.5 million in 2023 and $ 3.8 million in 2022.

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Under the Director’s Deferred Fee Plan, non-employee directors may defer all or a portion of annual fees and awards earned.

The deferrals are converted into phantom stock units equivalent to the value of Company common stock.

The deferrals are converted into units equivalent to the value of Company common stock.

Upon the director’s termination, death or disability, accumulated deferrals are distributed in the form of Company common stock in accordance with elections made by the directors.

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Gross unrecognized tax benefits at beginning of year

Gross increases in tax positions for prior years

Gross (decreases) increases in tax positions for prior years

Gross increases in tax positions for current year

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(1) Primarily uncollectible accounts written off — net of recoveries.

Subsequent Events

On January 17, 2024 , the Company completed the purchase of 17 freight terminals of Yellow Corporation for an aggregate purchase price of $ 235.7 million in cash.

In addition, on January 17, 2024 , the Company completed the acquisition of Yellow Corporation’s interests in leases for 11 freight terminals for an aggregate purchase price of $ 7.9 million in cash, plus the assumption of certain liabilities under the leases and the payment of cure costs.

Changes in and Disagreements with Acco untants on Accounting and Financial Disclosure

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-K

Item 7. Management’s Discussion and Analysis