Saia, Inc. (NASDAQ:SAIA) Q2 2023 Earnings Call Transcript

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Jason Seidl: Okay, well, I appreciate the clarification. And follow up on pricing. We were hearing back in June that LTL carriers were sort of pushing off some of the negotiations with customers based on the fact that they thought there could be an issue with yellow. Was this the case? And has that borne any fruits on the push back?

Fritz Holzgrefe: We weren’t pushing anything back. I mean, listen, our view of this is that we’ve got to get the pricing in place. I don’t know that we get there may be some anecdotes out there. But we haven’t seen anything like that. I know that there were customers that maybe saw some of the disruption, and we’re looking to secure their capacity. And certainly we were part of that and making sure that was all to the extent that it made sense for us, we negotiated those opportunities.

Jason Seidl: Okay, make sense. Appreciate the time as always, gentlemen.

Operator: The next question is from Ravi Shanker, with Morgan Stanley, your line is open.

Ravi Shanker: Thanks, everyone. Doug and Fritz, obviously, this is a potentially fairly large business opportunity for everybody. And maybe kind of jump ball right now, obviously, you got staying pretty disciplined on your pricing returns. But are you seeing any other players in the space who are like fairly aggressively going after this business? Or do you think everyone’s sort of waiting for it to settle in?

Fritz Holzgrefe: Yes, I don’t have a call out there for you. I would tell you that I think is we’re probably still early innings on how things shake out. But I think the one thing is fundamental for all LTL providers, regardless of where you’re positioned in the market, this is an inflationary business. And volume does not generate incremental return unless you get the appropriate pricing on it. I think we’ve seen how the industry has played out over the last few quarters, as volumes have declined, you see a lot of discipline around that. And I think it’s because of the underlying sort of basis of business. So I don’t anticipate any price led sort of volume chase, if you will.

Ravi Shanker: Got it. And maybe now switching gears and talking about the cycle, you guys I think hinted that you’re not seeing too much out there in terms of just cyclical improvement. Can you just give us some goalposts, like what are you going to be looking for? What are your customers telling you in terms of inventory level, kind of when do you think kind of the pure kind of cycle driven core business grows as well?

Fritz Holzgrefe: Well, I think the underlying growth that we have in our business before kind of this sort of last few weeks, has been our own competitive differentiation. So I think that’s been positive. I think that as we look at the more sort of macro indicators are out there, as you know, I think the GDP numbers look, that’s probably favorable right now. And I think if we see that developed in the second half of the year, I think that’s probably the green shoots that folks are looking for. I think that our customer set, we don’t hear anything particularly new, one way or the other is more of sort of a temperate environment. I don’t think it’s a recessionary environment or anything like that. I think it’s just a temporary environment versus the prior year, kind of where we were. So yes, I don’t think we have anything new to report there. But, I think as the second half develops, I mean, if we keep the recent sort of economic trends, I think it’s positive.

Ravi Shanker: Understood, thank you.

Operator: The next question is from Bascome Majors with Susquehanna. Your line is open.

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