Saia, Inc. (NASDAQ:SAIA) Q4 2022 Earnings Call Transcript

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Fritz Holzgrefe: I don’t have a reason why not. I have to be honest with you, we are marching on to that. This is the environment that we’re in right now, it’s a little bit more challenging than it has been, but we don’t see any reason why our service, our quality can’t be. It is, in many cases, becoming best-in-class or approaching that, and that deserves an appropriate return. And I think that operating in the mid-70s is our expectations or perhaps lower. I mean certainly, the bar has been set. So we’re going after it. I don’t know why we wouldn’t.

Ari Rosa: That’s great. Certainly very encouraging to hear. And then just in terms of the five terminal expansions that you’re looking at, maybe you could give a little color on what geographies those are focused on. Historically, you’ve spoken about kind of the benefits that you see in terms of increasing density in a particular geography. Maybe you could give us some color on kind of what the expectations are for the benefit that you might get from that.

Fritz Holzgrefe: Yes. Listen, 1 we’ve talked about, and if you followed this closely, we’ve talked about it’s a testament to how challenging real estate is, but we’ve got a facility that will open in Northeast Atlanta. That will give us three in this market. This is a growing metropolitan area. We have a challenge being able to provide the best-in-class service that we would expect in the Northeast part of Atlanta. We added one in Northwest Atlanta, I guess,1.5 years ago and been thrilled with all that. We’ve been able to service those customers and approach that market. We expect more of the same going up the 85 corridor. That’s an important add for us. I think it’s going to be — not only do we will able to do a great job for the customer there, we’ll be able to recruit drivers in that market, will create flexibility and capacity in our legacy facility there, and we’re going to say there’s going to be some efficiencies built into that.

Just the fact of the matter that we get to a customer without having to go through 1.5 hours of Atlanta traffic is a big deal. And I think that we’re excited about that opening. It just can’t happen fast enough.

Ari Rosa: That’s great. Well, certainly good luck with — the opening of those terminals and we’ll be watching closely. Thanks.

Operator: Our next question comes from Bruce Chan with Stifel.

Andrew Cox: Hey, good morning team. This is actually Andrew Cox on for Bruce. I just wanted to dive in a little bit — yes, no problem. I wanted to dive in a little bit on — I appreciate all the detail you guys have given on cost reductions and the natural attrition you guys have allowed to occur in response to slower volumes. But I kind of wanted to get a sense of your views on the other side of the equation that might be kind of backfilling a little bit of this excess capacity with maybe transactional shipments? You’ve talked about your shift to enforcing line haul and maybe having additional backhaul opportunities there, and you’ve now got 25% latent capacity and your costs are better aligned and we’ve heard from this week that some of your peers may be taking part in this exercise. So I just wanted to know your thoughts on backfilling capacity with maybe some transactional freight.

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