Arcbest Corporation · NASDAQ:ARCB
Arcbest — Cowen and Company 8th Annual Global Transportation Conference 2015
32 slides from Arcbest's conference presentation, Sep 10, 2015
Slide 1: Cowen and Company 8th Annual Global Transportation Conference
Cowen and Company 8th Annual Global Transportation Conference September 10, 2015 1
Slide 2: ArcBest Corporation
ArcBest Corporation SM Post Office Box 10048 (72917-0048) 3801 Old Greenwood Road Fort Smith, Arkansas 72903 Judy R. McReynolds President & Chief Executive Officer David R. Cobb Vice President, Chief Financial Officer David Humphrey Vice President, Investor Relations Phone: 479-785-6200 Email: dhump
Slide 3: Forward-Looking Statements
Forward-Looking Statements Certain statements and information in this presentation may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “foresee,” “int
Slide 4: Web Site: arcb.com
Web Site: arcb.com ArcBest DISCOVER ARCBEST | SUBSIDIARIES _ CUSTOMER SOLUTIONS | INVESTOR RELATIONS | NEWS & EVENTS (Corporation « ArcBest ABE AGE Panther Fleewnet Pack ArcBest ‘Corporation (Corporation ArcBest Corporation (ARCB :NASDAQ) LastPree Day's Change Youre bow Hh ) 304700 33.86 34.97 34.13
Slide 5: We are Tactical Problem Solvers
We are Tactical Problem Solvers Deliver creative solutions to transportation and logistics challenges Provide knowledge, expertise and a “can-do” attitude Offer a personal touch that sets us apart We are Empathetic Business Partners Listen and understand our customers’ challenges Care for
Slide 6: Common DNA / Customer Focus
Common DNA We use creativity and cooperation to solve transportation and logistics challenges for customers worldwide who value quality and an exceptional experience. Customer Focus Commercial Shippers Commercial Consumers and Consumers of Logistics Solutions Carriers of Household Goods and Private
Slide 7: Revenue Mix
Revenue Mix Premium Emergency & Transport Preventative Moving Freight Logistics Mgmt. Maintenance Services Transport Asset-Based Revenue Asset-light Logistics Revenue ArcBest Total Revenue 2Q’15 TTM – $1.95 Billion 2Q’15 TTM – $775 Million 2Q’15 TTM – $2.69 Billion FY2014 – $1.93 Billion FY2014 – $7
Slide 8: ABF Freight
One of North America’s largest and most- trusted less-than-truckload (LTL) carriers Operational infrastructure includes an innovative dual network for regional and national transportation Offers services that include Time-Critical & Expedited, White Glove & Final Mile, Tradeshow, Flatbed and M
Slide 9: ABF Logistics
ABF Logistics houses several growing asset-light businesses that provide customers with end-to-end solutions to complex supply chain needs, including: Ground transportation solutions through freight brokerage and intermodal services Worldwide ocean shipping services in either full- container (FC
Slide 10: Panther Premium Logistics
Largest independent full-service Premium Logistics® provider Customer verticals served include: 3PL, auto, manufacturing, high-value products, life sciences and government Panther meets extremely specific linehaul requirements such as temperature control, hazardous materials, geofencing, speci
Slide 11: FleetNet America
Provides vehicle maintenance and repair management of emergency roadside events and fleet maintenance programs Services offered to commercial carriers and private fleets with medium and heavy duty equipment FleetNet is the largest independent manager of maintenance events and third party maint
Slide 12: ABF Moving
SM ABF Moving As part of ABF Logistics , ABF Moving offers SM moving and storage services to the following markets through these national brands: − Consumers: U-Pack® − Military/Government: Albert Moving® − Corporate: MoveBuilder® The only consumer-facing business of ArcBest that responds to ind
Slide 13: Springboard for Growth
SPRINGBOARD FOR GROWTH 13
Slide 14: Springboard for Growth: U.S. freight market
Springboard for Growth The U.S. freight transportation market is $873 billion. Excluding private fleets, rail carload, parcel, water, and freight moving via pipeline, 46% of the market – nearly $403 billion – is available to us. Truckload $322B – 37% LTL $37B – 4% Air $29B – 3% Rail Intermodal $15B
Slide 15: Markets Served
Markets Served Approximate Opportunity: $255B $37B $4B $49B $20B $46B $36B $3B $17B $43B Source: Armstrong & Associates, ArcBest Technologies Business Insight & Analytics, management estimates – November 2014 15
Slide 16: Market Opportunity
Market Opportunity Research indicates that nearly 75% of ABF and Panther customers have two or more logistics needs offered within our family of companies. Nearly 85% of current ABF and Panther customers would consider or strongly consider sourcing one or more of those additional logistics servi
Slide 17: How will ArcBest seek to grow its asset-light logistics revenue?
How will ArcBest seek to grow the revenue of its asset-light logistics businesses? Sustained growth through new customer additions and cross-selling with established base of over 40,000 active ABF/Panther customers Continued development of services and resources to enhance growth in the fleet ma
Slide 18: Growth of the Asset-light Logistics Businesses
Growth of the Asset-light Logistics Businesses (1) (1) 2014 Revenue Growth 2014 EBITDA (in millions) (3) 31.9% $ 9.4 (2) 28.3% $ 27.0 15.3% $ 4.1 26.4% $ 40.5 (1)(2) (1)(2) Year % Revenue Growth EBITDA 2014 26.4% $ 40.5 2013 17.1% $ 28.0 2012 12.3% $ 20.9 (1) Amounts shown are before intersegment el
Slide 19: Springboard for Growth: Asset-light Logistics Growth
Springboard for Growth Growth of the Asset-light Logistics Businesses These businesses are evolving to become an ever-increasing percentage of ArcBest’s revenue and its service offerings Asset-light Logistics Percentage of ArcBest’s Total Revenue (1) 29% 30 27% ABF Freight Revenue Growth 25% 24 Comp
Slide 20: Success Factors
SUCCESS FACTORS 20
Slide 21: ABF Freight Labor Contract - Annual Increases
AG. Labor Contract - Annual Increases _ee Freight Prior Contract Current Contract 2008-2013 November 2013-March 2018 Years 1-5 Years 2-5 Wages & Benefits Wages & Benefits 3.5 2.3-3% Compounded Annual Growth Rate Compounded Annual Year 1 Growth Rate Wages & Benefits -4.1° (Includes a 7% reduction in
Slide 22: Strong Industry Brands
Strong Industry Brands The ABF Freight brand is highly recognized and well-respected across the logistics space. There is also a tremendous amount of confidence and equity in the Panther brand. Research shows that creative problem- solving is viewed as the common DNA of both the ABF Freight an
Slide 23: Employee Excellence
Winner of 2014 President’s Trophy Employee Excellence American Trucking Associations: President’s Trophy for Safety, only seven-time winner – announced October 31, 2014 Excellence in Security Award, only six-time winner Claims & Loss Prevention Award, only six-time winner America’s Road Team
Slide 24: Innovative Technology Drives Success
Innovative Technology Drives Success Industry leading technology facilitates the success of all ArcBest companies Since January 1, 2015, former ArcBest CFO has been leading ArcBest’s technology initiatives in a newly created role as Chief Innovation Officer, and as President of IT subsidiary Arc
Slide 25: Seamless Delivery of Customer Solutions
Seamless Delivery of Customer Solutions Enterprise-wide focus on providing the best answer for customers seeking multiple solutions from: ABF Logistics and Panther each offer services that complement both ABF Freight and each other, giving us the needed capabilities to be a holistic solutions pr
Slide 26: Historical & Current Financial Performance
HISTORICAL & CURRENT FINANCIAL PERFORMANCE 26
Slide 27: Financial Performance
Financial Performance $2,700 $200 $2,686 $2,613 $2,300 Recessionary Period Net Income reflects adjustments included in Non-GAAP reconciliation tables reported $2,066 in earnings press releases (primarily pension settlement charges and tax items). $1,882 $1,908 $1,837 $1,833 $1,770 Net Income (loss)
Slide 28: Revenue & Adjusted EBITDA
Revenue & Adjusted EBITDA $2,700 $400 $2,686 $2,613 $2,300 Recessionary Period $2,066 $1,882 $1,908 $1,837 Adjusted EBITDA ( millions) $1,833 $1,770 $1,635 $1,658 Revenue (millions) $1,473 $242 $217 $194 $190 $181 $176 $139 $128 $101 $96 $34 -$71 $0 -$100 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 29: Financial Statistics
Financial Statistics ABF Freight 2014 2013 % Change/Difference Revenue $ 1.93 billion $ 1.76 billion 9.6 % Operating Income (1) $ 55.4 million $ 11.9 million $ 43.5 million EBITDA $ 129.4 million $ 93.8 million $ 35.6 million Asset-light Logistics Businesses 2014 2013 % Change/Difference Revenue $ 7
Slide 30: Dividend, Borrowing Availability and Uses of Cash
On October 24, 2014, ArcBest announced an increase in its quarterly cash dividend to $0.06/share (from the previous $0.03/share). 1Q’15 updated banking agreements provide ArcBest with total, maximum borrowing availability of $350 million. Potential Uses of Available Cash To fund ArcBest’s corporat
Slide 31: Investor Takeaways
Investor Takeaways History of growth of logistical services in our legacy business and in asset- light logistics businesses in response to customer needs and demands Strategy of profitable growth through comprehensive service offerings and organic investment in people and resources Opportuniti
Slide 32: \ hg m)
\ hg m) G Hh a X X : si 5 z 3) 8 we 7. q|
ArcBest — Cowen and Company 8th Annual Global Transportation Conference 2015 on 6ix