Schneider National, Inc. · NYSE:SNDR
Schneider National — Q1 2024 Earnings Presentation
29 slides from Schneider National's earnings presentation, May 2, 2024
Slide 1: First Quarter 2024 Investor Presentation
FIRST QUARTER 2024 Investor Presentation INNOVATIVE – RESILIENT – DRIVEN
Slide 2: Presentation highlights
Presentation highlights • BUSINESS OVERVIEW • STRATEGY • CAPITAL ALLOCATION • TECHNOLOGY AND INNOVATION • PEOPLE AND VALUES • SECULAR TRENDS • INVEST WITH SNDR • CURRENT RESULTS AND OUTLOOK • APPENDIX 2
Slide 3: Schneider: 2023 by the numbers
BUSINESS OVERVIEW Schneider: 2023 by the numbers * * 3
Slide 4: Experienced leadership, focused on growth and delivering shareholder value
BUSINESS OVERVIEW Experienced leadership, focused on growth and delivering shareholder value Mark Rourke Darrell Campbell Jim Filter • Chief Executive Officer and President since • Executive Vice President, Chief Financial • Executive Vice President, Group 2019, previously serving as Executive Vice
Slide 5: Driven by our uncompromising values to deliver the goods that enhance lives
BUSINESS OVERVIEW Driven by our uncompromising values to deliver the goods that enhance the lives of people everywhere. Truckload Segment Over the road freight transportation via dry van, bulk, temperature-controlled and flat- bed trailers across either network (irregular route) or dedicated (struct
Slide 6: Truckload consists primarily of dedicated contract configurations
BUSINESS OVERVIEW Truckload consists primarily of dedicated contract configurations, complemented by a trailer-centric network operation. Dedicated • Contracted and consistent capacity through freight cycles • Multi-year contracts with 90%+ renewal rates • Driver-preferred alignment • Organic and ac
Slide 7: Intermodal's goal is to double in size by 2030
BUSINESS OVERVIEW Intermodal’s goal is to double in size by 2030, leveraging our differentiated company-owned container, chassis and dray model. • Nearly 27,000 company-owned containers and 23,000 company-owned chassis • Approximately 1,400 company dray tractors, executing the majority of dray movem
Slide 8: Logistics continues to grow share connecting shippers and carriers
BUSINESS OVERVIEW Logistics continues to grow share by connecting shippers and carriers of all sizes through our advanced brokerage solutions, including Power Only. • 50,000+ qualified carriers in our network • Enabled by proprietary Schneider FreightPower® technology which digitally aggregates frei
Slide 9: Strong financial position built on diligent capital allocation
BUSINESS OVERVIEW Our strong financial position is built on diligent capital allocation, the relentless pursuit of profitable growth and delivering shareholder value. Operating revenues Income Free cash flow Adjusted diluted earnings per share from operations $1.37 $5,499 $296 $109 $0.94 $4,384 $106
Slide 10: Diversity of customers and end-markets supports resiliency
BUSINESS OVERVIEW Diversity of customers and end-markets served Growing Customer Base: Change in Customer Concentration supports resiliency through business cycles. Diverse End-Market Footprint: 2023 Revenues (xFSC) All other 33% Retail 19% Food and Online-only beverage 14% retail 2% Consumer Transp
Slide 11: Comprehensive North American footprint with industry-leading safety
BUSINESS OVERVIEW Comprehensive North American footprint with industry-leading safety, culture and performance. 11
Slide 12: Our strategy is to deliver a superior portfolio of services
STRATEGY Our strategy is to deliver a superior portfolio of services that enables our business to prosper and achieve sustainable growth in revenue and earnings performance and shareholder value. Strategic approach ► Deploy capital to targeted service offerings in support of our goal Always to enhan
Slide 13: Strategic growth areas are Intermodal, Logistics and Dedicated
STRATEGY Schneider’s strategic growth areas are Intermodal, Logistics and Dedicated. We have purposefully reshaped the portfolio since our April 2017 IPO to enable resiliency through cycles. Increased earnings contribution Increased Dedicated mix from Intermodal and Logistics within Truckload fleet
Slide 14: Use-of-cash strategy balances growth, shareholder returns and resilience
CAPITAL ALLOCATION Schneider’s use-of-cash strategy creates a balance between growth, shareholder returns and resilient financial performance. Maintain strong Fund operating and Fund acquisitive Committed to balance sheet growth needs growth needs shareholder value • Maintain investment • Maintain o
Slide 15: Committed to disciplined capital deployment and long-term shareholder value
CAPITAL ALLOCATION Committed to disciplined capital deployment and delivering long-term shareholder value Share repurchase program Quarterly dividends As of Mar 31, 2024* *Does not include the $2.00 special dividend paid in Nov 2020 • Announced our inaugural $150.0 million, three-year share • Commit
Slide 16: Technology to advance and simplify core business processes
TECHNOLOGY AND INNOVATION Our technology aims to advance and simplify core business processes, eliminate complexity in decision making and elevate information flow with key stakeholders. • Our proprietary Schneider FreightPower® platform and marketplace drive growth into the enterprise by creating s
Slide 17: Living out our core values in support of our vision
PEOPLE AND VALUES How we do it is as important: Living out our core values in support of our vision. SAFETY FIRST RESPECT INTEGRITY IN EXCELLENCE AND ALWAYS FOR ALL EVERY ACTION IN W HAT W E DO Schneider trucks are spec’d Schneider has provided nearly $11 Schneider named one of TIME Schneider become
Slide 18: Commitment to sustainability and fleet and workforce for the future
PEOPLE AND VALUES Our commitment to sustainability allows us to authentically address a changing landscape to build a fleet and workforce for the future. Sustainability goals: Reduce CO2 Double Schneider’s Intermodal emissions by 7.5% size by 2030, thus reducing carbon per mile by 2025 emissions by
Slide 19: Secular trends that drive our strategy and future growth
SECULAR TRENDS Secular trends that drive our strategy and our future growth. Truckload Intermodal Logistics Customers value committed contract Increased focus on sustainability goals for Operating conditions are expected to freight in order to build reliability and all stakeholders. remain pressured
Slide 20: Positioned for value creation and growth in transportation
INVEST W ITH SNDR Positioned for value creation and Premier multimodal growth at the forefront of the transportation platform transportation industry. • Most diverse logistics and Technology leader and innovator transportation platform in North America. • Portfolio of services enables growth Strong
Slide 21: Current results and outlook: 1Q24 summary
CURRENT RESULTS AND OUTLOOK We remain focused on advancing our strategic growth areas of Dedicated, Intermodal and Logistics. We believe our actions, 1Q23 1Q24 combined with ongoing Operating Revenues $1,429 $1,319 operational efforts and strategic Revenues (xFSC) $1,250 $1,163 investments in our mu
Slide 22: 1Q24 Enterprise Results
CURRENT RESULTS AND OUTLOOK 1Q24 Enterprise Results Operating revenues Revenues excluding fuel surcharge • Our enterprise continued to feel the pressures of the ongoing freight recession in the first quarter. • However, we did recognize some signs of progress in market dynamics and in our commercial
Slide 23: 1Q24 Truckload Results
CURRENT RESULTS AND OUTLOOK 1Q24 Truckload Results Revenues excluding Income from fuel surcharge operations • Revenues were flat YoY due to dedicated organic and acquisitive growth, offset by lower network pricing and volumes. • Earnings were lower YoY due to pricing and volume pressures in network,
Slide 24: 1Q24 Intermodal Results
CURRENT RESULTS AND OUTLOOK 1Q24 Intermodal Results Revenues excluding fuel surcharge Income from operations • Revenues decreased YoY primarily due to decreased revenue per order, as volumes were flat YoY. • Earnings were lower YoY due to lower revenue per order and higher empty repositioning costs,
Slide 25: 1Q24 Logistics Results
CURRENT RESULTS AND OUTLOOK 1Q24 Logistics Results Revenues excluding Income from fuel surcharge operations • Revenues were lower primarily due to decreased revenue per order and 8% lower brokerage volume YoY. • Power Only continued to demonstrate resiliency and delivered favorable volumes YoY. • Ea
Slide 26: Updated full year 2024 guidance
CURRENT RESULTS AND OUTLOOK Based on first quarter results and market expectations, we have updated our full year 2024 guidance. We still believe the cycle is far closer to its end than its beginning and anticipate improving conditions as the $0.85 - $1.00 year progresses; however, we have Full year
Slide 27: Disclaimer and Forward-Looking Statements
Special Note Regarding Forward-Looking Statements This presentation contains and, any commentary or discussion by management of the content of this presentation may include “forward-looking statements,” as defined in the Private Securities Litigation Reform Act of 1995 (the “Act”), which Disclaimer
Slide 28: Appendix
Appendix
Slide 29: Non-GAAP Reconciliations
APPENDIX Non-GAAP Reconciliation—Revenues Excluding Fuel Surcharge1 Non-GAAP Reconciliation—Adjusted Income from Operations1 ($M) 1Q23 1Q24 ($M) 1Q23 1Q24 Operating revenues $1,429 $1,319 Income from operations $115 $29 Less: fuel surcharge revenues 179 156 Amortization of intangible assets2 - 1 Rev