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

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Fritz Holzgrefe: Got it. That’s a fair point. I think I would probably one of the things we’re pretty early into this. But certainly, there’s a path to beat that. I mean, if we continue our core execution, continue to manage mix, keep our costs in line. I certainly think there’s an opportunity, we can beat that, our shipments and tonnage trends, we kind of keep that in perspective in the right place, I feel pretty good that we could, On the other hand, it is because it’s a period of disruption, we’ve got to be real careful about, what the mix of business looks like, and what the relative profitability of any freight that we pick up or new customers are. That’s pretty significant to our value proposition is that we match those customers with, they understanding what that service level is and what that that means from a sort of pricing perspective. So, yes, I think there’s a possibility we can beat it. And — but it’s not, we still got to go execute it.

Operator: The next question is from Ken Hoexter with Bank of America. Your line is open.

Ken Hoexter : Hey, great. Good morning, Fritz and Doug. And congrats on great results and working through this process here. Do you still feel like you have 20% excess capacity is that kind of after adding the five service centers and looking at more, maybe just talk about the capacity ability to grow here?

Doug Col : Real quick and apologies on that pronunciation. We all know its Hexter but you weren’t in the queue early, so I didn’t get a chance to get Fritz some backlog in.

Ken Hoexter: Okay, I’ve heard all different sides.

Doug Col: I know buddy, that’s all me. All right. If we — we think about it right now, we probably got around 15% capacity across the entire network, and Ken I think what’s important to focus on there, because of where we in a sort of network maturity, there are some facilities in there that might be at lower capacity levels, and we’ve got some of that open the last two years, they have 60% capacity. So the opportunity right now for us just to continue to fully utilize the facilities that we’ve got in place that we’ve invested in. And that’s a great opportunity for us to differentiate in a market and — to find that new customer, so that’s there for us. And it’s in the larger areas in the network, where we’re fully utilizing those assets are approaching full utilization, we’ve got investments in place that will upgrade some of those facilities even this year.

So, we feel pretty good about where we are, in a disrupted environment like this, the challenge, and this is not unlike what we’ve experienced over the last several years, which is that you don’t always know where the freight is going to come from. So if I give you that network capacity number, that’s an average across a bunch. And in some places, we might say, you know, what, we’re going have to manage the capacity and other places will sales go and get the freight.

Ken Hoexter: So, I guess I want to follow up on an earlier question, which is, really some business gets assigned right away, and maybe from your experience, and how long does it really take to settle in, right, because there’s this chaos that needs to be assigned right away and then freight gets distributed. Maybe talk about how much business I don’t know, multi-year contracts versus how quick you can move that pricing in the base?

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