Slide 1: 3Q24 Earnings Presentation
3Q24 EARNINGS PRESENTATION October 29, 2024 1
Slide 2: Disclosure Statement
DISCLOSURE STATEMENT This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and made pursuant to the safe harbor provisions of the Private Securities Lit
Slide 3: Business Overview
BUSINESS OVERVIEW DEREK LEATHERS Chairman and Chief Executive Officer
Slide 4: Werner Overview (WERN)
WERNER OVERVIEW (WERN) 6TH 68 2,260 TOTAL DRIVERS IN COMPANY YEARS IN OMAHA, NE LARGEST HISTORY WITH ONE MILLION OR MORE SAFE DRIVING BUSINESS HEADQUARTERS DEDICATED CARRIER IN U.S.3 MILES WITH WERNER 4,905 DEDICATED 4 > 90% DEDICATED CUSTOMER 2,540 ONE-WAY TRUCKLOAD 4 $2.3B 1.5% 1 1 2 2 13,117 290
Slide 5: 3Q24 Financial Highlights
3Q24 FINANCIAL HIGHLIGHTS 3Q24 Y/Y Change HIGHLIGHTS Revenues $746M (9)% $0.11 • Dedicated continued to display resiliency; growing revenue per GAAP EPS (72)% truck 26 of 27 quarters • Further engineering of the One-Way fleet resulted in 7% growth Adj. EPS1 $0.15 in miles per truck Y/Y; RPTM inflect
Slide 6: Our Dedicated Expertise Is a Distinct Competitive Advantage
OUR DEDICATED EXPERTISE IS A DISTINCT COMPETITIVE ADVANTAGE High-barriers-to-entry business KEY METRICS >90% customer retention that requires specific expertise through proven reliability • Werner is the 6th largest Dedicated truckload carrier in U.S.3 • Driver involved freight loading/unloading • H
Slide 7: DriveSM Strategy Supports 2024 Priorities
DRIVESM STRATEGY SUPPORTS 2024 PRIORITIES WERNER DRIVESM BUILDING ON 5Ts AND SHAPING OUR FUTURE DRIVING GROWTH IN CORE BUSINESS • Returning TTS adjusted operating income margin to within our long-term range of 12-17% • Growing Dedicated revenue in 2H24 • Expanding One-Way utility, Werner PowerLinkSM
Slide 8: Financial Results
FINANCIAL RESULTS CHRIS WIKOFF Executive Vice President, Treasurer and Chief Financial Officer
Slide 9: 3Q24 Results
3Q24 RESULTS ADJUSTED OPERATING INCOME1 ($M) TOTAL REVENUES ($M) AND ADJUSTED OPERATING MARGIN1 ADJUSTED EPS1 $828 20. 0% $12 0.0 $818 $11 0.0 18. 0% $10 0.0 $90 .0 $79.5 16. 0% 14. 0% $1. 00 $0.90 $0. 90 $80 .0 $0. 80 12. 0% $70 .0 $0. 70 10. 0% $60 .0 $746 $41.9 $0.42 $0. 60 $50 .0 8.0 % $0. 50 $4
Slide 10: 3Q24 Truckload Transportation Services (TTS) Results
3Q24 TRUCKLOAD TRANSPORTATION SERVICES (TTS) RESULTS 3Q22 3Q23 3Q24 3Q24 vs. 3Q23 Revenues ($M) $621.9 $572.2 $522.8 (9)% Revenues, net FSC ($M) $510.7 $489.5 $460.1 (6)% Adjusted Operating Income1 ($M) $76.3 $41.6 $24.5 (41)% Adjusted Operating Margin1, 2 14.9% 8.5% 5.3% (320) bps Adjusted Operatin
Slide 11: TTS Fleet Metrics Update
TTS1 FLEET METRICS UPDATE TTS FLEET DOWN 9% Y/Y TO 7,445; RPTPW UP 3% AND INCREASED 22 OUT OF LAST 27 QUARTERS TRUCKING REVENUES2 ($M) AVERAGE TRUCKS REVENUES / TRUCK / WEEK2 DEDICATED TRUCKLOAD $314 $306 $4,508 $4,488 $4,563 $285 5,359 5,254 4,809 3Q22 3Q23 3Q24 3Q22 3Q23 3Q24 3Q22 3Q23 3Q24 ONE-WA
Slide 12: 3Q24 Werner Logistics Results
3Q24 WERNER LOGISTICS RESULTS 3Q22 3Q23 3Q24 3Q24 vs. 3Q23 Revenues ($M) $187.1 $230.3 $206.8 (10)% Revenues, less purchased $32.2 $35.3 $30.6 (13)% transportation expense ($M)1 Adjusted Operating Income ($M)1 $5.6 $3.2 $0.8 (75)% Adjusted Operating Margin1 3.0% 1.4% 0.4% (100) bps Y/Y COMMENTARY (3
Slide 13: Actions in Place to Generate Additional Cost Savings in 2024
ACTIONS IN PLACE TO GENERATE ADDITIONAL COST SAVINGS IN 2024 $50M+ COST CONTAINMENT 2024 Target FOCUS & DISCIPLINE 2023 $40M $50M+ Savings Achieved Projected • >$90M savings over 2-year through 3Q24 Savings period (2023 + 2024) • >60% structural and sustainable • Initiatives aimed to mitigate inflat
Slide 14: Strong Capital & Cash Flow Generation
STRONG CAPITAL & CASH FLOW GENERATION CASH FLOW LIQUIDITY1 ($ millions) ($ millions) $474 $446 $449 Cash, $427 $409 $55 $333 $318 $284 $266 $259 $193 $206 $434 $180 Total Liquidity $143 $140 $131 Available $66 $53 Credit, $379 2019 2020 2021 2022 2023 YTD 2024 2 Op. CF Net CapEx FCF SOLID CASH FLOW
Slide 15: Flexible Debt and Low Leverage
FLEXIBLE DEBT AND LOW LEVERAGE DEBT MATURITY SCHEDULE NET DEBT TO LTM EBITDA1 ($ millions) 1.6x $690 1.4x 1.2x 1.2x 1.0x 0.6x 2024 2025 2026 2027 2028 12/31/21 12/31/22 12/31/23 3/31/24 6/30/24 9/30/24 HEALTHY BALANCE SHEET • $690M Debt; unchanged Y/Y ($635M Net Debt • 51% effectively-fixed rate deb
Slide 16: Disciplined Capital Allocation
DISCIPLINED CAPITAL ALLOCATION STRATEGIC PRIORITIES CAPEX REINVESTMENT FOR GROWTH Reinvestment for Long-Term Growth 2024 Net CapEx Priorities: • Reinvestments to maintain low-age, safe and modern trucks and trailers • Returning to historical dollar range, following elevated spend in 2023 • Growth in
Slide 17: 2024 Guidance Metrics and Assumptions
2024 GUIDANCE METRICS AND ASSUMPTIONS Prior Guidance Actual 2024 Guidance (as of 7/30/24) (as of 9/30/24) (as of 10/29/24) 2024 GUIDANCE TTS Truck Count from BoY to EoY (6)% to (3)% (7)% (8)% to (6)% (annual) (YTD24) (annual) Net Capital Expenditures $225M to $275M $206M $240M to $260M (annual) (YTD
Slide 18: 2024 Modeling Assumptions
2024 MODELING ASSUMPTIONS • Annual net interest expense increases $7M to $10M in 2024 primarily from higher interest rates and maturing low-cost term loan and swaps • Gains on sale of property and equipment stabilizes at low levels with improvement delayed and not expected until 2025, resulting in f
Slide 19: Appendix
APPENDIX
Slide 20: Revenues Snapshot
REVENUES SNAPSHOT 2023 REVENUES 2023 REVENUES 2023 REVENUES BY SEGMENT BY VERTICAL BY CUSTOMER Top 50 Customers 2% Retail 57% Top 5 35% 28% 28% $3.3B Food & TOTAL 20% Top 10 48% REVENUES 70% Beverage 70% Manufacturing Top 25 15% 65% & Industrial Truckload Transportation Services (TTS) Logistics & 8%
Slide 21: Reconciliation of Non-GAAP Financial Measures – Consolidated
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – CONSOLIDATED (Unaudited) (In thousands, except per share amounts) Non-GAAP Adjusted Operating Income and Non-GAAP Adjusted Operating Margin (1) Quarter Ended September 30, 2022 2023 2024 % of Op. % of Op. % of Op. $ Rev. $ Rev. $ Rev. Operating income
Slide 22: Reconciliation of Non-GAAP Financial Measures – Consolidated
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – CONSOLIDATED (Unaudited) (In thousands, except per share amounts) Non-GAAP Free Cash Flow (1), (8) YTD Year Ended December 31, Sept. 30, 2019 2020 2021 2022 2023 2024 $ $ $ $ $ $ Net cash provided by operating activities — (GAAP) $ 426,644 $ 445,909 $
Slide 23: Reconciliation of Non-GAAP Financial Measures – Consolidated
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – CONSOLIDATED (Unaudited) (In thousands, except per share amounts) Non-GAAP Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA); Non-GAAP Net Debt; and Non-GAAP Net Debt to EBITDA Ratio (1), (9) LTM Year Ended December 31, March 31,
Slide 24: Reconciliation of Non-GAAP Financial Measures – TTS Segment
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – TRUCKLOAD TRANSPORTATION SERVICES (TTS) SEGMENT (Unaudited) (In thousands) Non-GAAP Adjusted Operating Income and Non-GAAP Adjusted Operating Margin (1) Quarter Ended September 30, 2022 2023 2024 % of Op. % of Op. % of Op. $ Rev. $ Rev. $ Rev. Operatin
Slide 25: Reconciliation of Non-GAAP Financial Measures – TTS Segment (Continued)
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – TRUCKLOAD TRANSPORTATION SERVICES (TTS) SEGMENT (Continued) (Unaudited) (In thousands) Non-GAAP Adjusted Operating Revenues, Net of Fuel Surcharge; Non-GAAP Adjusted Operating Expenses, Net of Fuel Surcharge; Non-GAAP Adjusted Operating Margin, Net of
Slide 26: Reconciliation of Non-GAAP Financial Measures – Werner Logistics Segment
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – WERNER LOGISTICS SEGMENT (Unaudited) (In thousands) Non-GAAP Adjusted Operating Revenues, Less Purchased Transportation Expense (1) Quarter Ended September 30, 2022 2023 2024 $ $ $ Operating revenues — (GAAP) $ 187,138 $ 230,252 $ 206,774 Non-GAAP adju
Slide 27: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (1) Non-GAAP adjusted operating income; non-GAAP adjusted operating margin; non-GAAP adjusted operating margin, net of fuel surcharge; non-GAAP adjusted net income attributable to Werner; non-GAAP adjusted diluted earnings per share; non-GAAP free cash f
Slide 28: For More Information, Visit Werner.com
FOR MORE INFORMATION, VISIT WERNER.COM