UNIVERSAL LOGISTICS HOLDINGS, INC. 10-Q

ITEM 1: FINANCIAL STATEMENTS UNIVERSAL LOGISTICS HOLDINGS, INC. Unaudited Consolidated Balance Sheets (In thousands, except share data) March 29, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 20,602 $ 19,351 Marketable securities 11,989 11,590 Accounts receivable – net of allowance for credit losses of $ 6,072 and $ 7,806 , respectively 259,188 293,646 Contract assets 30,360 29,752 Other receivables 32,595 30,174 Prepaid expenses and other 33,324 23,962 Due from affiliates 1,035 1,338 Total current assets 389,093 409,813 Property and equipment – net of accumulated depreciation of $ 447,849 and $ 429,001 , respectively 763,849 742,366 Operating lease right-of-use asset 96,980 74,003 Goodwill 206,756 206,756 Intangible assets – net of accumulated amortization of $ 160,789 and $ 155,290 , respectively 143,072 150,926 Contract assets, net of current portion 196,114 198,059 Deferred income taxes 329 329 Other assets 4,012 4,585 Total assets $ 1,800,205 $ 1,786,837 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 77,948 $ 59,977 Current portion of long-term debt 91,581 88,812 Current portion of operating lease liabilities 30,543 28,563 Accrued expenses and other current liabilities 63,662 70,744 Insurance and claims 34,594 32,837 Due to affiliates 24,183 23,258 Income taxes payable 6,335 377 Total current liabilities 328,846 304,568 Long-term liabilities: Long-term debt, net of current portion 645,153 670,273 Operating lease liabilities, net of current portion 71,606 50,788 Deferred income taxes 106,612 109,012 Other long-term liabilities 1,586 5,173 Total long-term liabilities 824,957 835,246 Stockholders' equity: Common stock, no par value. Authorized 100,000,000 shares; 26,332,864 and 26,319,754 shares issued; 26,330,436 and 26,317,326 shares outstanding, respectively 26,333 26,320 Paid-in capital 5,388 5,016 Treasury stock, at cost; 2,428 shares ( 107 ) ( 107 ) Retained earnings 626,268 623,018 Accumulated other comprehensive (loss): Interest rate swaps, net of income taxes of $ 255 and $ 412 , respectively 758 1,177 Foreign currency translation adjustments ( 12,238 ) ( 8,401 ) Total stockholders’ equity 646,402 647,023 Total liabilities and stockholders’ equity $ 1,800,205 $ 1,786,837 See accompanying notes to consolidated financial statements. 2 UNIVERSAL LOGISTICS HOLDINGS, INC. Unaudited Consolidated Statements of Income (In thousands, except per share data) Thirteen Weeks Ended March 29, 2025 March 30, 2024 Operating revenues: Truckload services $ 37,778 $ 42,030 Brokerage services 20,265 59,614 Intermodal services 68,455 76,715 Dedicated services 85,007 88,316 Value-added services 170,885 225,232 Total operating revenues 382,390 491,907 Operating expenses: Purchased transportation and equipment rent 79,743 124,633 Direct personnel and related benefits 164,501 140,805 Operating supplies and expenses 51,328 92,824 Commission expense 4,255 6,610 Occupancy expense 11,253 10,568 General and administrative 13,177 13,507 Insurance and claims 6,965 7,167 Depreciation and amortization 35,488 20,701 Total operating expenses 366,710 416,815 Income from operations 15,680 75,092 Interest income 2,928 218 Interest expense ( 11,152 ) ( 6,297 ) Other non-operating income 578 1,104 Income before income taxes 8,034 70,117 Income tax expense 2,020 17,660 Net income $ 6,014 $ 52,457 Earnings per common share: Basic $ 0.23 $ 1.99 Diluted $ 0.23 $ 1.99 Weighted average number of common shares outstanding: Basic 26,320 26,307 Diluted 26,346 26,328 Dividends declared per common share $ 0.105 $ 0.105 See accompanying notes to consolidated financial statements. 3 UNIVERSAL LOGISTICS HOLDINGS, INC. Unaudited Consolidated Statements of Comprehensive Income (In thousands) Thirteen Weeks Ended March 29, 2025 March 30, 2024 Net Income $ 6,014 $ 52,457 Other comprehensive income (loss): Unrealized changes in fair value of interest rate swaps, net of income taxes of $( 158 ) and $ 202 , respectively ( 419 ) 607 Foreign currency translation adjustments ( 3,837 ) 746 Total other comprehensive income (loss) ( 4,256 ) 1,353 Total comprehensive income $ 1,758 $ 53,810 See accompanying notes to consolidated financial statements. 4 UNIVERSAL LOGISTICS HOLDINGS, INC. Unaudited Consolidated Statements of Cash Flows (In thousands) Thirteen Weeks Ended March 29, 2025 March 30, 2024 Cash flows from operating activities: Net income $ 6,014 $ 52,457 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 35,488 20,701 Noncash lease expense 7,924 7,510 Gain on marketable equity securities ( 537 ) ( 990 ) Loss (gain) on disposal of property and equipment 16 ( 85 ) Amortization of debt issuance costs 241 241 Stock-based compensation 385 700 Provision for credit losses ( 256 ) ( 819 ) Deferred income taxes ( 2,400 ) 11,279 Change in assets and liabilities: Trade and other accounts receivable 35,505 3,578 Contract assets, prepaid expenses and other assets ( 5,522 ) ( 89,883 ) Principal reduction in operating lease liabilities ( 8,251 ) ( 7,703 ) Accounts payable, accrued expenses, income taxes payable, insurance and claims and other current liabilities 18,061 41,313 Due to/from affiliates, net 1,227 2,143 Other long-term liabilities ( 3,587 ) ( 3,561 ) Net cash provided by operating activities 84,308 36,881 Cash flows from investing activities: Capital expenditures ( 52,573 ) ( 68,572 ) Proceeds from the sale of property and equipment 940 202 Proceeds from the sale of marketable securities 138 — Net cash used in investing activities ( 51,495 ) ( 68,370 ) Cash flows from financing activities: Proceeds from borrowing - revolving debt 129,844 114,785 Repayments of debt - revolving debt ( 115,301 ) ( 98,945 ) Proceeds from borrowing - term debt 5,284 47,091 Repayments of debt - term debt ( 42,420 ) ( 30,989 ) Dividends paid ( 2,764 ) ( 2,762 ) Net cash provided by (used in) financing activities ( 25,357 ) 29,180 Effect of exchange rate changes on cash and cash equivalents ( 6,205 ) 922 Net increase (decrease) in cash 1,251 ( 1,387 ) Cash and cash equivalents – beginning of period 19,351 12,511 Cash and cash equivalents – end of period $ 20,602 $ 11,124 Supplemental cash flow information: Cash paid for interest $ 8,978 $ 6,108 Cash paid for income taxes $ 541 $ 159 Non-cash operating and financing activities: During the thirteen-week period ended March 29, 2025, the Company had non-cash activities resulting from the $ 2.8 million of declared dividends that were unpaid as of the end of the period. See accompanying notes to consolidated financial statements. 5 UNIVERSAL LOGISTICS HOLDINGS, INC. Unaudited Consolidated Statements of Stockholders’ Equity (In thousands, except per share data) Common stock Paid-in capital Treasury stock Retained earnings Accumulated other comprehensive income (loss) Total Balances – December 31, 2023 $ 31,008 $ 5,103 $ ( 96,840 ) $ 595,450 $ ( 2,523 ) $ 532,198 Net income — — — 52,457 — 52,457 Comprehensive income (loss) — — — — 1,353 1,353 Dividends ($ 0.105 per share) — — — ( 2,762 ) — ( 2,762 ) Stock based compensation 33 667 — — — 700 Retirement of treasury stock ( 4,723 ) ( 831 ) 96,840 ( 91,286 ) — — Balances – March 30, 2024 $ 26,318 $ 4,939 $ — $ 553,859 $ ( 1,170 ) $ 583,946 Balances – December 31, 2024 $ 26,320 $ 5,016 $ ( 107 ) $ 623,018 $ ( 7,224 ) $ 647,023 Net income — — — 6,014 — 6,014 Comprehensive income (loss) — — — — ( 4,256 ) ( 4,256 ) Dividends ($ 0.105 per share) — — — ( 2,764 ) — ( 2,764 ) Stock based compensation 13 372 — — — 385 Balances – March 29, 2025 $ 26,333 $ 5,388 $ ( 107 ) $ 626,268 $ ( 11,480 ) $ 646,402 See accompanying notes to consolidated financial statements. 6 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements (1) Basis of Presentation The accompanying unaudited consolidated financial statements of Universal Logistics Holdings, Inc. and its wholly-owned subsidiaries (“Universal”) have been prepared by the Company’s management. In these notes, the terms “us,” “we,” “our,” or the “Company” refer to Universal and its consolidated subsidiaries. In the opinion of management, the unaudited consolidated financial statements include all normal recurring adjustments necessary to present fairly the information required to be set forth therein. All intercompany transactions and balances have been eliminated in consolidation. Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, should be read in conjunction with the consolidated financial statements as of December 31, 2024 and 2023 and for each of the years in the three-year period ended December 31, 2024 included in the Company’s Form 10-K filed with the Securities and Exchange Commission. The preparation of the consolidated financial statements requires the use of management’s estimates. Actual results could differ from those estimates. Our fiscal year ends on December 31 and consists of four quarters, each with thirteen weeks. During the first quarter of 2025, the Company identified certain triggering events related to components of the intermodal reporting segment. In accordance with ASC 350 Intangibles—Goodwill and Other and ASC 360 Property, Plant, and Equipment, the Company evaluated certain indefinite and long lived tangible and intangible assets for impairment. The results of those procedures concluded that no impairments were present. Current Economic Conditions The Company makes estimates and assumptions that affect reported amounts and disclosures included in its financial statements and accompanying notes and assesses certain accounting matters that require consideration of forecasted financial information. The Company's assumptions about future conditions important to these estimates and assumptions are subject to uncertainty, including disruptions to the global supply chain resulting from new or additional tariffs and the negative impact inflationary pressures can have on our operating costs. Prolonged periods of inflation could cause interest rates, equipment, maintenance, labor and other operating costs to continue to increase. New or increased tariffs on imported goods could also impose additional costs on our business or cause disruption in global supply chains. Such disruptions could lead to a decrease in shipping volumes, which would have an adverse impact on our revenues and results of operations. (2) Recent Accounting Pronouncements In December 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU modifies income tax disclosures by requiring greater disaggregation of information in the rate reconciliations and disclosure of income taxes paid disaggregated by jurisdiction. This ASU is effective for fiscal years beginning after December 31, 2024, using a prospective approach. Early adoption and retrospective application are permitted. We are currently evaluating the impact of the new standard, which is limited to financial statement disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which expands disclosures about certain categories of expenses. This ASU is effective for fiscal years beginning after December 15, 2026. We are currently evaluating the impact of the new standard on our consolidated financial statements and disclosures. (3) Revenue Recognition The Company recognizes revenue in accordance with ASU 2014-09, Revenue from Contracts with Customers. The Company broadly groups its services into the following categories: truckload services, brokerage services, intermodal services, dedicated services and value-added services. We disaggregate these categories and report our service lines separately on the Consolidated Statements of Income. Truckload services include dry van, flatbed, heavy-haul and refrigerated operations. We transport a wide variety of general commodities, including automotive parts, machinery, building materials, paper, food, consumer goods, furniture, steel and other metals on behalf of customers in various industries. To complement our available capacity, we also provide customers with freight brokerage services by utilizing third-party transportation providers to move freight. Intermodal services include rail-truck, steamship-truck and support services. Our intermodal support services are primarily short- to medium-distance delivery of rail and steamship containers between the railhead or port and the customer. 7 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (3) Revenue Recognition – continued Dedicated services are primarily provided in support of automotive and retail customers using van equipment. Our dedicated services are primarily short-run or round-trip moves within a defined geographic area. Transportation services are short-term in nature; agreements governing their provision generally have a term of one year or less. They do not contain significant financing components. The Company recognizes revenue over the period transportation services are provided to the customer, including service performed as of the end of the reporting period for loads currently in-transit, in order to recognize the value that is transferred to a customer over the course of the transportation service. We determine revenue in-transit using the input method, under which revenue is recognized based on the duration of time that has lapsed from the departure date (start of transportation services) to the arrival date (completion of transportation services). Measurement of revenue in-transit requires the application of significant judgment. We calculate the estimated percentage of an order’s transit time that is complete at period end, and we apply that percentage of completion to the order’s estimated revenue. Value-added services, which are typically dedicated to individual customer requirements, include lift services, material handling, consolidation, sequencing, sub-assembly, cross-dock services, kitting, repacking, warehousing, returnable container management and specialty project development. Value-added revenues are substantially driven by the level of demand for outsourced logistics services and specialty project needs. Major factors that affect value-added service revenue include changes in manufacturing supply chain requirements and production levels in specific industries, particularly the North American automotive and Class 8 heavy-truck industries. Revenue is recognized as control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration the Company expects to receive in exchange for its services. We have elected to use the “right to invoice” practical expedient to recognize revenue, reflecting that a customer obtains the benefit associated with value-added services as they are provided. The contracts in our value-added services businesses are negotiated agreements, which contain both fixed and variable components. The variability of revenues is driven by volumes and transactions, which are known as of an invoice date. Value-added service contracts typically have terms that extend beyond one year, and they do not include financing components. Beginning in 2024, value-added services also includes specialty project development services for customers. The specialty project development service is accounted for as a single unit of account (i.e., as a single performance obligation). Revenue is recognized over time as the Company continuously transfers control of the project to the customer. Because we transfer control of the project over time, we recognize revenue to the extent of our progress towards completion of our performance obligations. We use the cost-to-cost method for these contracts, which measures progress towards completion for each performance obligation based on the ratio of costs incurred to date to the total estimated costs at completion for the applicable performance obligation. Incurred cost represents work performed, which corresponds with and thereby best represents the transfer of control to the customer. Revenue, including estimated fees or profits, is recorded proportionately as costs are incurred. Cost of operations consists of labor, materials, subcontractor costs, and other direct and indirect costs, and we include them in operating supplies and expenses on the consolidated statements of income. Changes to the total estimated contract revenue or cost for a given project, either due to unexpected events or revisions to management’s initial estimates, are recognized in the period in which they are determined. The following table provides information related to contract balances associated with our contracts with customers (in thousands): March 29, 2025 December 31, 2024 Contract assets $ 30,360 $ 29,752 Contract assets, net of current portion 196,114 198,059 Total $ 226,474 $ 227,811 We generally receive payment for performance obligations within 45 days of completion of transportation services and 65 days for completion of value-added services. As it relates to our specialty development project, we will receive payments in 120 equal monthly installments. Contract assets in the table above generally relates to revenue recognized in excess of billings for our specialty development project, as well as revenue in-transit at the end of the reporting period. During the thirteen-week periods ended March 29, 2025 and March 30, 2024, we recorded $ 2.9 million and $ 0.2 million of interest income, respectively, related to the specialty development project. As of December 31, 2023, the contract asset balance was $ 0.7 million. As of March 29, 2025 and December 31, 2024, the amortization of the contract asset for cash payments received was $ 2.8 million and $ 0.9 million, respectively. 8 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (4) Marketable Securities 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 7. The following table sets forth market value, cost basis, and unrealized gains on equity securities (in thousands): March 29, 2025 December 31, 2024 Fair value $ 11,989 $ 11,590 Cost basis 7,087 7,264 Unrealized gain $ 4,902 $ 4,326 The following table sets forth the gross unrealized gains and losses on the Company’s marketable securities (in thousands): March 29, 2025 December 31, 2024 Gross unrealized gains $ 5,340 $ 4,926 Gross unrealized losses ( 438 ) ( 600 ) Net unrealized gains $ 4,902 $ 4,326 The following table sets forth the Company's net realized gains (losses) on marketable securities (in thousands): Thirteen Weeks Ended March 29, 2025 March 30, 2024 Realized gain Sale proceeds $ 138 $ — Cost basis of securities sold 119 — Realized gain $ 19 $ — Realized gain, net of taxes $ 14 $ — The Company did no t sell marketable equity securities during the thirteen-week period ended March 30, 2024. During the thirteen-week periods ended March 29, 2025 and March 30, 2024, our marketable equity securities portfolio experienced a net unrealized pre-tax gain (loss) in market value of approximately $ 518,000 and $ 990,000 , respectively, which was reported in other non-operating income for the period. (5) Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities are comprised of the following (in thousands): March 29, 2025 December 31, 2024 Accrued payroll $ 31,058 $ 35,376 Accrued payroll taxes 5,615 3,690 Driver escrow liabilities 3,431 3,989 Legal settlements and claims 3,200 3,200 Commissions, other taxes and other 20,358 24,489 Total $ 63,662 $ 70,744 9 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (6) Debt Debt is comprised of the following (in thousands): Interest Rates at March 29, 2025 March 29, 2025 December 31, 2024 Outstanding Debt: Revolving Credit Facility (1) (2) 5.92 % $ 325,395 $ 310,851 UACL Credit Agreement (2) Term Loan 5.92 % 31,500 51,000 Revolver 5.92 % — — Equipment Financing (3) 2.25 % to 7.31 % 264,653 278,155 Real Estate Facility (4) 6.44 % 118,501 122,635 Margin Facility (5) 6.57 % — — Unamortized debt issuance costs ( 3,315 ) ( 3,556 ) 736,734 759,085 Less current portion of long-term debt 91,581 88,812 Total long-term debt, net of current portion $ 645,153 $ 670,273 (1) Our Revolving Credit Facility provides us with a revolving credit commitment of up to $ 400 million. We may borrow under the Revolving Credit Facility until maturity on September 30, 2027 , and this indebtedness bears interest at index-adjusted SOFR, or a base rate, plus an applicable margin based on the Company’s leverage ratio. The Revolving Credit Facility is secured by a first-priority pledge of the capital stock of applicable subsidiaries, as well as first-priority perfected security interests in cash, deposits, accounts receivable, and selected other assets of the applicable borrowers. The Revolving Credit Facility includes customary affirmative and negative covenants and events of default, as well as financial covenants requiring minimum fixed charge coverage and leverage ratios, and customary mandatory prepayments provisions. At March 29, 2025, we were in compliance with all covenants under the facility, and $ 74.6 million was available for borrowing on the revolver. (2) Our UACL Credit Agreement provides for maximum borrowings of $ 90 million in the form of an $ 80 million term loan and a $ 10 million revolver. The term loan matures on September 30, 2027 and is repaid in consecutive quarterly installments. The remaining term loan balance is due at maturity. We may borrow under the revolving credit facility until maturity on September 30, 2027 . Borrowings bear interest at index-adjusted SOFR, or a base rate, plus an applicable margin based on the borrowers’ leverage ratio. The UACL Credit Agreement is secured by a first-priority pledge of the capital stock of applicable subsidiaries, as well as first-priority perfected security interest in cash, deposits, accounts receivable, and selected other assets of the applicable borrowers. The UACL Credit Agreement includes customary affirmative and negative covenants and events of default, as well as financial covenants requiring minimum fixed charge coverage and leverage ratios, and customary mandatory prepayments provisions. At March 29, 2025, we were in compliance with all covenants under the facility, and $ 10.0 million was available for borrowing on the revolver. (3) Our Equipment Financing consists of a series of promissory notes issued by wholly owned subsidiaries. The equipment notes are secured by liens on specific titled vehicles or operating equipment. The notes are generally payable in 60 monthly installments and bear interest at fixed rates ranging from 2.25 % to 7.31 %. One equipment note is payable in 72 monthly installment and bears interest at Term SOFR , plus an applicable margin equal to 2.25 %. (4) Our Real Estate Facility consists of a $ 165.4 million term loan, and the facility matures on April 29, 2032 . Obligations under the facility are secured by first-priority mortgages on specific parcels of real estate owned by the Company, including all land and real property improvements, and first-priority assignments of rents and related leases of the loan parties. The credit agreement includes customary affirmative and negative covenants, and principal and interest are payable on the facility on a monthly basis, based on an annual amortization of 10 %. The facility bears interest at Term SOFR , plus an applicable margin equal to 2.12 %. At March 29, 2025, we were in compliance with all covenants under the facility. (5) Our Margin Facility is a short-term line of credit secured by our portfolio of marketable securities. It bears interest at Term SOFR plus 1.10 % . The amount available under the line of credit is based on a percentage of the market value of the underlying securities. At March 29, 2025, the maximum available borrowings under the line of credit were $ 6.0 million. 10 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (6) Debt – continued The Company is also party to an interest rate swap agreement that qualifies for hedge accounting. The Company executed the swap agreement to fix a portion of the interest rate on its variable rate debt. Under the swap agreement, the Company receives interest at Term SOFR and pays a fixed rate of 2.88 %. The swap agreement has an effective date of April 29, 2022, a maturity date of April 30, 2027 , and an amortizing notional amount of $ 71.7 million. At March 29, 2025, the fair value of the swap agreement was an asset of $ 1.0 million. Since the swap agreement qualifies for hedge accounting, the changes in fair value are recorded in other comprehensive income (loss), net of tax. See Note 7 for additional information pertaining to interest rate swaps. (7) Fair Value Measurements and Disclosures FASB ASC Topic 820, “ Fair Value Measurements and Disclosures, ” defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date and expanded disclosures with respect to fair value measurements. FASB ASC Topic 820 also establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. We have segregated all financial assets and liabilities that are measured at fair value on a recurring basis into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date in the tables below (in thousands): March 29, 2025 Level 1 Level 2 Level 3 Fair Value Measurement Assets Cash equivalents $ 10 $ — $ — $ 10 Marketable securities 11,989 — — 11,989 Interest rate swap — 1,013 — 1,013 Total $ 11,999 $ 1,013 $ — $ 13,012 December 31, 2024 Level 1 Level 2 Level 3 Fair Value Measurement Assets Cash equivalents $ 26 $ — $ — $ 26 Marketable securities 11,590 — — 11,590 Interest rate swap — 1,589 — 1,589 Total $ 11,616 $ 1,589 $ — $ 13,205 11 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (7) Fair Value Measurements and Disclosures – continued The valuation techniques used to measure fair value for the items in the tables above are as follows: • Cash equivalents – This category consists of money market funds which are listed as Level 1 assets and measured at fair value based on quoted prices for identical instruments in active markets. • Marketable securities – Marketable securities represent equity securities, which consist of common and preferred stocks, are actively traded on public exchanges and are listed as Level 1 assets. Fair value was measured based on quoted prices for these securities in active markets. • Interest rate swap – The fair value of our interest rate swap is determined using a methodology of netting the discounted future fixed cash payments (or receipts) and the discounted expected variable cash receipts (or payments). The variable cash receipts (or payments) are based on the expectation of future interest rates (forward curves) derived from observed market interest rate curves. The fair value measurement also incorporates credit valuation adjustments to appropriately reflect both the Company’s nonperformance risk and the respective counterparty’s nonperformance risk. Our Revolving Credit Facility, UACL Credit Agreement, Real Estate Facility and one equipment note consist of variable rate borrowings. We categorize borrowings under these credit agreements as Level 2 in the fair value hierarchy. The carrying value of these borrowings approximate fair value because the applicable interest rates are adjusted frequently based on short-term market rates. For our Equipment Financing with fixed rates, the fair values are estimated using discounted cash flow analyses, based on our current incremental borrowing rates for similar types of borrowing arrangements. We categorize these borrowings as Level 2 in the fair value hierarchy. The carrying value and estimated fair value of these promissory notes at March 29, 2025 is summarized as follows: Carrying Value Estimated Fair Value Equipment promissory notes $ 249,090 $ 249,603 We have not elected the fair value option for any of our financial instruments. (8) Leases As of March 29, 2025, our obligations under operating lease arrangements primarily related to the rental of office space, warehouses, freight distribution centers, terminal yards and equipment. Right-of-use assets represent our right to use an underlying asset over the lease term and lease liabilities represent the obligation to make lease payments resulting from the lease agreement. We recognize a right-of-use asset and a lease liability on the effective date of a lease agreement. These assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date, using our incremental borrowing rate as of the respective dates of lease inception, as the rate implicit in each lease is not readily determinable. Our incremental borrowing rate is based on collateralized borrowings of similar assets with terms that approximate the lease term when available and when collateralized rates are not available, we use uncollateralized rates with similar terms adjusted for the fact that it is an unsecured rate. Our lease obligations typically do not include options to purchase the leased property, nor do they contain residual value guarantees or material restrictive covenants. Options to extend or terminate an agreement are included in the lease term when it becomes reasonably certain the option will be exercised. As of March 29, 2025, we were not reasonably certain of exercising any renewal or termination options, and as such, no adjustments were made to the right-of-use lease assets or corresponding liabilities. Leases with an initial term of 12 months or less, short-term leases, are not recorded on the balance sheet. Lease expense for short-term and long-term operating leases is recognized on a straight-line basis over the lease term. For facility leases, variable lease costs include the costs of common area maintenance, taxes, and insurance for which we pay the lessors an estimate that is adjusted to actual expense on a quarterly or annual basis depending on the underlying contract terms. For equipment leases, variable lease costs may include additional fees associated with using equipment in excess of estimated amounts. 12 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (8) Leases – continued The following table summarizes our lease costs for the thirteen weeks ended March 29, 2025 and March 30, 2024 (in thousands): Thirteen Weeks Ended March 29, 2025 With Affiliates With Third Parties Total Lease cost Operating lease cost $ 2,732 $ 6,578 $ 9,310 Short-term lease cost 211 3,882 4,093 Variable lease cost 188 1,515 1,703 Total lease cost $ 3,131 $ 11,975 $ 15,106 Thirteen Weeks Ended March 30, 2024 With Affiliates With Third Parties Total Lease cost Operating lease cost $ 2,426 $ 6,375 $ 8,801 Short-term lease cost 17 2,735 2,752 Variable lease cost 242 1,207 1,449 Total lease cost $ 2,685 $ 10,317 $ 13,002 The following table summarizes other lease related information as of and for the thirteen week periods ended March 29, 2025 and March 30, 2024 (in thousands): Thirteen Weeks Ended March 29, 2025 With Affiliates With Third Parties Total Other information Cash paid for amounts included in the measurement of operating leases $ 2,748 $ 6,836 $ 9,584 Right-of-use assets obtained in exchange for new operating lease liabilities $ 30,620 $ 40 $ 30,660 Weighted-average remaining lease term (in years) 6.9 2.8 4.7 Weighted-average discount rate 6.6 % 6.1 % 6.4 % Thirteen Weeks Ended March 30, 2024 With Affiliates With Third Parties Total Other information Cash paid for amounts included in the measurement of operating leases $ 2,439 $ 6,545 $ 8,984 Right-of-use assets obtained in exchange for new operating lease liabilities $ 2,271 $ 343 $ 2,614 Weighted-average remaining lease term (in years) 4.3 3.0 3.4 Weighted-average discount rate 7.7 % 5.5 % 6.2 % 13 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (8) Leases – continued Future minimum lease payments under these operating leases as of March 29, 2025, are as follows (in thousands): With Affiliates With Third Parties Total 2025 (remaining) $ 9,473 $ 18,289 $ 27,762 2026 10,336 21,169 31,505 2027 9,339 11,828 21,167 2028 9,327 4,603 13,930 2029 8,560 2,346 10,906 Thereafter 12,832 — 12,832 Total required lease payments $ 59,867 $ 58,235 $ 118,102 Less amounts representing interest ( 15,953 ) Present value of lease liabilities $ 102,149 (9) Transactions with Affiliates Matthew T. Moroun is Chair of our Board of Directors and his son, Matthew J. Moroun, is a member of our Board. Certain Moroun family trusts beneficially own a majority of our outstanding shares. Matthew T. Moroun is trustee of these trusts with investment authority over the shares, and Frederick P. Calderone, a member of our Board, is special trustee of these trusts with voting authority over the shares. The Moroun family also owns or significantly influences the management and operating policies of other businesses engaged in transportation, insurance, business services, and real estate development and management. In the ordinary course of business, we procure from these companies certain supplementary administrative support services, including legal, human resources, tax, and IT infrastructure services. The Audit Committee of our Board reviews and approves related party transactions. The cost of these services is based on the actual or estimated utilization of the specific service. We also purchase other services from our affiliates. The following is a schedule of cost incurred and included in operating expenses for services provided by affiliates for the thirteen weeks ended March 29, 2025 and March 30, 2024 (in thousands): Thirteen Weeks Ended March 29, 2025 March 30, 2024 Insurance $ 23,067 $ 21,421 Real estate rent and related costs 3,886 3,508 Administrative support services 2,001 1,867 Truck fuel, maintenance and other operating costs 1,553 4,341 Contracted transportation services 1 36 Total $ 30,508 $ 31,173 We pay the direct variable cost of maintenance, fueling and other operational support costs for services delivered at our affiliate’s trucking terminals that are geographically remote from our own facilities. Such costs are billed when incurred, paid on a routine basis, and reflect actual labor utilization, repair parts costs or quantities of fuel purchased. We lease 25 facilities from related parties. Our occupancy is based on either month-to-month or contractual, multi-year lease arrangements that are billed and paid monthly. Leasing properties from a related party affords us significant operating flexibility; however, we are not limited to such arrangements. See Note 8, “Leases” for further information regarding the cost of leased properties. We purchase employee medical, workers’ compensation, property and casualty, cargo, warehousing and other general liability insurance from an insurance company controlled by our controlling stockholder. In our Consolidated Balance Sheets, we record our insured claims liability and the related recovery in insurance and claims, and other receivables. At March 29, 2025 and December 31, 2024, there were $ 22.1 million and $ 19.5 million, respectively, included in each of these accounts for insured claims. 14 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (9) Transactions with Affiliates – continued Other services from affiliates, including contracted transportation services, are delivered to us on a per-transaction basis or pursuant to separate contractual arrangements provided in the ordinary course of business. At March 29, 2025 and December 31, 2024, amounts due to affiliates were $ 24.2 million and $ 23.3 million, respectively. During the thirteen weeks March 29, 2025, we contracted with an affiliate to provide real property improvements for us totaling $ 4.4 million. There were no such purchases made during the thirteen weeks ended March 30, 2024. During the thirteen weeks ended March 30, 2024, we purchased trailers from an affiliate totaling $ 1.6 million. There were no such purchases made during the thirteen weeks ended March 29, 2025. Services provided by Universal to Affiliates We periodically assist companies that are owned by our controlling stockholder by providing selected transportation and logistics services in connection with their specific customer contracts or purchase orders. Truck fueling and administrative expenses are presented net in operating expense. Following is a schedule of services provided to affiliates for the thirteen weeks and ended March 29, 2025 and March 30, 2024 (in thousands): Thirteen Weeks Ended March 29, 2025 March 30, 2024 Contracted transportation services $ 118 $ 230 Facilities and related support 643 660 Total $ 761 $ 890 At March 29, 2025 and December 31, 2024, amounts due from affiliates were $ 1.0 million and $ 1.3 million, respectively. (10) Stock Based Compensation In February 2025, we granted 24,195 shares of restricted stock under our equity plan to certain employees, including 5,887 shares to our Chief Executive Officer and 7,521 shares to our Chief Financial Officer. The restricted stock awards have a grant date fair value of $ 29.73 per share, based on the closing price of our stock. The shares will vest in four equal installments on each March 15 in 2026, 2027, 2028, and 2029, subject to their continued employment with us. In February 2025, we granted 1,904 shares of restricted stock under our equity plan to one of our employees. This restricted stock award has a fair value of $ 27.46 per share, based on the closing price of our stock on the grant date. The shares will vest in four equal installments on each March 15 in 2026, 2027, 2028, and 2029, subject to their continued employment with us. In May 2024, we granted 1,545 shares of common stock under our equity plan to non-employee directors. These restricted stock awards have a fair value of $ 45.22 per share, based on the closing price of our stock on the grant date, and vested immediately. In February 2024, we granted 21,105 shares of restricted stock under our equity plan to certain employees, including 5,160 shares to our Chief Executive Officer and 5,223 shares to our Chief Financial Officer. The restricted stock awards have a grant date fair value of $ 31.96 per share, based on the closing price of our stock. The shares will vest in four equal installments on each March 15 in 2025, 2026, 2027, and 2028, subject to their continued employment with us. In March 2023, we granted 34,611 shares of restricted stock under our equity plan to certain employees, including 9,134 shares to our Chief Executive Officer and 8,441 shares to our Chief Financial Officer. The restricted stock awards have a grant date fair value of $ 27.59 per share, based on the closing price of our stock. The shares will vest in four equal installments on each March 15 in 2024, 2025, 2026, and 2027, subject to their continued employment with us. In September 2021, we granted 2,355 shares of restricted stock under our equity plan to one of our employees. This restricted stock award has a fair value of $ 20.46 per share, based on the closing price of our stock on the grant date. The shares will vest in five equal increments on each August 9 in 2022, 2023, 2024, 2025 and 2026, subject to continued employment with us. In February 2020, we granted 5,000 shares of restricted stock under our equity plan to our Chief Financial Officer. This restricted stock award has a fair value of $ 17.74 per share, based on the closing price of our stock on the grant date. The shares vested on February 20, 2024. In January 2020, we granted 60,000 shares of restricted stock under our equity plan to our Chief Executive Officer. This restricted stock award has a fair value of $ 18.82 per share, based on the closing price of our stock on the grant date. The shares will vest in installments of 20,000 shares on January 10, 2024 and January 10, 2026, and installments of 10,000 shares on January 10, 2027 and January 10, 2028, subject to his continued employment with us. 15 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (10) Stock Based Compensation – continued A grantee’s vesting of restricted stock awards may be accelerated under certain conditions, including retirement. The following table summarizes the status of our non-vested shares and related information for the period indicated: Shares Weighted Average Grant Date Fair Value Non-vested at January 1, 2025 85,538 $ 24.49 Granted 26,099 $ 29.56 Vested ( 13,110 ) $ 29.35 Forfeited — $ — Balance at March 29, 2025 98,527 $ 25.19 In the thirteen week periods ended March 29, 2025 and March 30, 2024, the total grant date fair value of vested shares recognized as compensation costs was $ 0.4 million and $ 0.7 million, respectively. As of March 29, 2025, there was approximately $ 2.5 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements. That cost is expected to be recognized on a straight-line basis over the remaining vesting period. As a result, we expect to recognize stock-based compensation expense of $ 1.0 million in 2026, $ 0.8 million in 2027, $ 0.5 million in 2028 and $ 0.2 million in 2029. (11) Earnings Per Share Basic earnings per common share amounts are based on the weighted average number of common shares outstanding, excluding outstanding non-vested restricted stock. Diluted earnings per common share include dilutive common stock equivalents determined by the treasury stock method. For the thirteen weeks ended March 29, 2025 and March 30, 2024, there were 26,221 and 21,011 weighted average non-vested shares of restricted stock, respectively, included in the denominator for the calculation of diluted earnings per share. No shares of non-vested restricted stock were excluded from the calculation of diluted earnings per share due to anti-dilution during the thirteen weeks ended March 29, 2025 or March 30, 2024. (12) Dividends On February 6, 2025 , our Board of Directors declared a cash dividend of $ 0.105 per share of common stock, payable on April 1, 2025 to shareholders of record at the close of business on March 3, 2025 . Declaration of future cash dividends is subject to final determination by the Board of Directors each quarter after its review of our financial condition, results of operations, capital requirements, any legal or contractual restrictions on the payment of dividends and other factors the Board of Directors deems relevant. (13) Segment Reporting We report our financial results in three distinct reportable segments: contract logistics, intermodal and trucking, which are based primarily on the services each segment provides. This presentation reflects the manner in which management evaluates our operating segments, including an evaluation of economic characteristics and applicable aggregation criteria. Operations aggregated in our contract logistics segment deliver value-added or dedicated transportation services to support in-bound logistics to industrial customers and major retailers on a contractual basis, generally pursuant to terms of one year or longer. Our intermodal segment is associated with local and regional drayage moves coordinated by company-managed terminals using a mix of owner-operators, company equipment and third-party capacity providers (broker carriers). Operations included in our trucking segment are associated with individual freight shipments coordinated by our agents and company-managed terminals using a mix of owner-operators, company equipment and broker carriers. Other non-reportable segments are comprised of legacy company-managed brokerage operations and the Company’s subsidiaries that provide support services to other subsidiaries. The Company’s President and Chief Executive Officer serves as our Chief Operating Decision Maker (CODM). Our CODM is responsible for reviewing segment performance and making decisions regarding the allocation of resources. The CODM uses income from operations compared to budgeted, forecasted, and prior period amounts to assess segment performance. Separate balance sheets are not prepared by segment, and we do not provide asset information by segment to the CODM. 16 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (13) Segment Reporting – continued The following tables summarize information about our reportable segments for the thirteen week periods ended March 29, 2025 and March 30, 2024 (in thousands): Thirteen Weeks Ended March 29, 2025 Contract Logistics Intermodal Trucking Other (2) Total Total operating revenues (1) $ 255,892 $ 70,697 $ 55,582 $ 219 $ 382,390 Operating expenses: Purchased transportation and equipment rent 3,401 32,996 41,044 2,302 79,743 Direct personnel and related benefits 145,021 17,952 1,528 — 164,501 Operating supplies and expenses 41,249 10,037 2,460 ( 2,418 ) 51,328 Commission expense 16 583 3,656 — 4,255 Occupancy expense 7,119 4,762 37 ( 665 ) 11,253 Depreciation and amortization 20,723 7,223 2,206 5,336 35,488 Other segment expenses (3) 14,504 7,853 2,461 ( 4,676 ) 20,142 Total operating expenses 232,033 81,406 53,392 ( 121 ) 366,710 Income from operations $ 23,859 $ ( 10,709 ) $ 2,190 $ 340 $ 15,680 (1) Eliminated intersegment revenues in the contract logistics, intermodal and trucking segments were $ 0.1 million, $ 1.1 million, and $ 0.0 million, respectively. (2) Credits within other non-reportable include allocations and eliminations to the other reportable segments. (3) Other segment expenses include general and administrative, insurance and claims, and other corporate allocations to reportable segments. Thirteen Weeks Ended March 30, 2024 (Recast) Contract Logistics Intermodal Trucking Other (2) Total Total operating revenues (1) $ 313,548 $ 78,363 $ 69,655 $ 30,341 $ 491,907 Operating expenses: Purchased transportation and equipment rent 3,474 36,112 53,698 31,349 124,633 Direct personnel and related benefits 117,567 19,814 1,092 2,332 140,805 Operating supplies and expenses 80,923 11,177 2,231 ( 1,507 ) 92,824 Commission expense 12 450 6,148 — 6,610 Occupancy expense 7,039 4,390 67 ( 928 ) 10,568 Depreciation and amortization 10,145 7,975 563 2,018 20,701 Other segment expenses (3) 12,922 6,737 2,187 ( 1,172 ) 20,674 Total operating expenses 232,082 86,655 65,986 32,092 416,815 Income from operations $ 81,466 $ ( 8,292 ) $ 3,669 $ ( 1,751 ) $ 75,092 (1) Eliminated intersegment revenues in the contract logistics, intermodal and trucking segments were $ 0.1 million, $ 0.4 million, and $ 0.1 million, respectively. (2) Credits within other non-reportable include allocations and eliminations to the other reportable segments. (3) Other segment expenses include general and administrative, insurance and claims, and other corporate allocations to reportable segments. 17 UNIVERSAL LOGISTICS HOLDINGS, INC. Notes to Unaudited Consolidated Financial Statements - Continued (14) Commitments and Contingencies Our principal commitments relate to long-term real estate leases and payment obligations to equipment vendors. The Company is involved in certain other claims and pending litigation arising from the ordinary conduct of business. We also provide accruals for claims within our self-insured retention amounts. Based on the knowledge of the facts, and in certain cases, opinions of outside counsel, in the Company’s opinion the resolution of these claims and pending litigation will not have a material effect on our financial position, results of operations or cash flows. However, if we experience claims that are not covered by our insurance or that exceed our estimated claim reserve, it could increase the volatility of our earnings and have a materially adverse effect on our financial condition, results of operations or cash flows. At March 29, 2025, approximately 43 % of our employees were subject to collective bargaining agreements that are renegotiated periodically, 24 % of which are subject to contracts that expire in 2025. (15) Subsequent Events On April 24, 2025 , our Board of Directors declared a cash dividend of $ 0.105 per share of common stock, payable on July 1, 2025 to stockholders of record at the close of business on June 2, 2025 . Declaration of future cash dividends is subject to final determination by the Board of Directors each quarter after its review of our financial condition, results of operations, capital requirements, any legal or contractual restrictions on the payment of dividends and other factors the Board of Directors deems relevant. On April 10, 2025, the Company closed on the purchase of a terminal in Savannah, GA. The purchase price was $ 16.0 million. The Company used funds borrowed under its existing line of credit to fund the balance at closing. 18