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

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Fritz Holzgrefe: Yes, some of this — they’re obviously existing customers, and everybody in our book, I mean, by and large, everybody’s on a one-year sort of pricing agreement. So I think that that we’ve got to make sure that the pricing that’s in place we feel good about it, but as we pick up the revenue on an account, we may not have had the account earlier or larger percentage of the business because we didn’t have the pricing that was maybe attractive to the customer. Now they’re they move the shift the freight to us, it’s, that’s our pricing, and we’re satisfied with it. So, the other piece, and that’s probably more like the national account type business, but then the other, the new customer or the customer we’ve done a little business with or maybe we’ve opened up new lanes with a customer, those are the ones that you got to keep an eye on to make sure you understand what is the freight characteristics look like?

What the freight, you’re handling, what that customer looks like. And in that case, you might manage that out or try to manage it differently in the short term. So I think it’s, as you go through the industry goes through a settling process around this disruption, and freight kind of moves around the other competitors or to us, I think you’ll see a fair amount of — I don’t know if I’d say churn, but it’s a movement over the next several weeks.

Ken Hoexter: Great. Thanks for the time guys. Appreciate.

Operator: The next question is from Jon Chappell with Evercore ISI, your line is open.

Jonathan Chappell: Thank you. And good morning. Fritz, to your answer for the previous question about capacity being different in different locations. And most of these new terminals that you brought on, there’s been a lot of them haven’t been running at the profitability of the entirety of the network. And there was a thought process that over time, they would ramp to that. Does this what’s going on in the market today accelerate kind of the marking the market of the profitability across the new terminals? Or is it completely dependent on the geographic mix of the freight?

Fritz Holzgrefe: We’ll say it is dependent on both, but it fact the matter is, is that this the opportunity to grow the business more accelerated pace right now that helps us drive that, leveraging those investments, building the density around our line, home network or pickup economies, all those sorts of things. So yes, the additional well managed growth here is a potentially will adder for us.

Jonathan Chappell: Okay, and then my second one, kind of mixing the short term with the long term, the work disruption has been thrown around a lot. I’d imagine you’re going to flex PT as you get this acceleration of shipments, but as you think about more permanent resourcing, whether that be headcount equipment, et cetera. How are you thinking about, you know, what’s been happening over the last couple of weeks and how you’re investing above and beyond, just the terminal expansion that’s been on the radar for some time.

Fritz Holzgrefe: So this is where I think that our ability to manage our linehaul costs is important, it’s an advantage for us. We feel pretty good and very comfortable fluxing our PT up and down as we need to, to meet the service requirements of our customers. If you recall — if you follow us over the last couple of quarters, you saw us insource as many miles as we could, as we saw volume declines in the sort of the Q3 Q4 into Q1 period. And now, as you as you ramp back out of the kind of more than a growth mode, you’ve got to be able to scale that line haul network. And that means you’ve got to fully utilize the drivers that you have you add drivers in markets, because now if we’re at these growth rates with these new markets, we have the opportunity to scale that and add drivers.

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