Arcbest Corporation · NASDAQ:ARCB
Arcbest — Stifel 2017 Transportation & Logistics Conference
28 slides from Arcbest's conference presentation, Feb 14, 2017
Slide 1: Stifel 2017 Transportation & Logistics Conference
℠ ARCBEST February 14, 2017 Stifel 2017 Transportation & Logistics Conference
Slide 2: 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 3: Logistics Leader
Logistics Leader 1923 13,000 $2.7 billion Customer Focus Founded Employees Revenue in 2016 3
Slide 4: Who Are We?
Who Are We? One logistics enterprise with assets and guaranteed capacity options Skill is meeting our customers’ Will is demands. demanding more of ourselves With The Skill & The Will to creatively offer than they do. integrated logistics solutions We’ll find a way to deliver: • Knowledge • Expertis
Slide 5: Vision
Vision 5
Slide 6: Our Values
ArcBest OUR VALUES CREATIVITY GROWTH We create solutions. We grow our people and our business. INTEGRITY EXCELLENCE We ao the right thing We exceed expectations. COLLABORATION WELLNESS We work together. We embrace total health SKILL ArcBest
Slide 7: A Logistics Company with the Skill & The Will to Grow
Key Elements A Logistics Company with the Skill & The Will to Grow 1 Improving The Customer Experience 2 Capitalize On Opportunities 3 Maintain A Solid Financial Foundation 7
Slide 8: Improving The Customer Experience: Supply Chains Are More Complex
Improving The Customer Experience Supply Chains Are More Complex Supply chains are evolving rapidly due to faster customer demand for products, lean inventory levels, transportation capacity, speed of fulfillment and cost volatilities 1 Global product sourcing requires unique distribution models 1 o
Slide 9: Improving The Customer Experience: Enhanced Market Approach
Improving The Customer Experience Enhanced Market Approach Effective January 1, 2017, ArcBest Implemented a New Corporate Structure to Better Serve Customers Goal: Differentiate ArcBest from our competition by becoming one fully integrated logistics enterprise that provides our customers with a supe
Slide 10: Enhanced Market Approach: Who We Are, What We Are Doing
Improving The Customer Experience Enhanced Market Approach Who We Are • ArcBest is one logistics enterprise with assets and guaranteed capacity options with creative problem solvers who deliver integrated logistics solutions. What We Are Doing • We are shaping our organization and processes to effic
Slide 11: Key Specific Organizational Changes
Improving The Customer Experience Enhanced Market Approach Key Specific Organizational Changes Sales Marketing and Customer Experience Unified ArcBest sales function Unified ArcBest marketing function and new ArcBest customer experience function Yield Management Unified ArcBest yield management func
Slide 12: Brands and Services
Brands and Services - ArcBest ——— Ocean Managed Ground Expedite Maintenance pe Air Transportation LTL and Premium Moving and Repair aS fd kee Truckload Warehousing | | ABF Panther UPack FleetNet me Freight mmm Premium Logistics mmm We Drive. You Save. ‘America SKIL vi ArcBest | »
Slide 13: Cost Savings & Charges
Improving The Customer Experience Enhanced Market Approach Cost Savings & Charges The improved organizational structure, along with the consolidation of certain systems and facilities and other cost saving actions produce an estimated pre-tax annualized operating expense savings of $15 million.
Slide 14: Benefits of Cross-Selling ArcBest Services
Improving The Customer Experience Benefits of Cross-Selling ArcBest Services Compared to accounts using only one ArcBest service, accounts using multiple ArcBest services have: • Higher retention rates • Higher number of shipments • Greater revenue • Greater profit 14
Slide 15: Impact of Innovation & Technology
Improving The Customer Experience Impact of Innovation & Technology Differentiating technologies and innovations have played a strong role in ArcBest’s history and will help us seize our opportunities for growth. Current initiatives include: • Enhancements and redesign to further optimize the less-t
Slide 16: Capitalize On Opportunities: Market Potential
Capitalize On Opportunities Market Potential Approximate ArcBest Opportunity: $273B SM $41 B $5 B $59 B Domestic Transportation Less-Than-Truckload Expedite Shipping Management $20 B $47 B $38 B Premium Logistics International Warehousing & Distribution $17 B $3 B $43 B Moving Services Final Mile Ma
Slide 17: Capitalize On Opportunities: Steps Taken for Future Growth
Capitalize On Opportunities ArcBest has conducted extensive research to better understand: • The voice and needs of our diverse customer base • The services we must offer to meet their needs • How to effectively deliver those services as a trusted partner • Current voids in the marketplace that ArcB
Slide 18: Capitalize On Opportunities: Existing Opportunities
Capitalize On Opportunities Existing Opportunities: Research indicates that nearly 75% of our less-than-truckload and expedite customers have two or more logistics needs offered by the ArcBest enterprise. Nearly 85% of our current less-than-truckload and expedite customers would consider or strongly
Slide 19: Asset-Based Customers: Asset-Light Total Market Potential Revenue
Capitalize On Opportunities ArcBest Asset-Based Customers: Asset-Light Total Market Potential Revenue Has need for the service and is Confident or Neutral that ArcBest can Provide The Service and is Using – or would consider using – a 3PL or Broker $12.8B …and is Aware that ArcBest Provides The Serv
Slide 20: Expedite Customers: Expedited Total Market Potential Revenue
Capitalize On Opportunities ArcBest Expedite Customers: Expedited Total Market Potential Revenue Has need for the service and is Confident or Neutral that ArcBest can Provide The Service $5.7B …and is Not Price-Sensitive $1.6B …and tends to be Loyal and is Aware that ArcBest Provides The Service $1.
Slide 21: Consolidated Revenue & Operating Income
Maintain A Solid Financial Foundation $2,700 Consolidated Revenue & Operating Income* $120 $2,667 $2,700 Revenue $2,613 Adjusted Operating Income* ( millions) Operating Income* $2,300 $81 $76 $2,066 Revenue (millions) $1,908 $1,658 $43 $21 $11 -$12 -$54 $0 $-60 2010 2011 2012 2013 2014 2015 2016 *Op
Slide 22: Equity, Cash & Outstanding Debt
Historical Financial Results As of December 31, 2016 Maintain A Solid Financial Foundation Net Cash (Debt) ($73) Million Total Debt to LTM EBITDAR* 1.34X Total Debt to Capitalization 0.29X $700 Equity, Cash & Outstanding Debt Total Equity $599 Million $600 $500 $400 Millions $300 $200 $100 $0 Dec. '
Slide 23: Strategic and Operating Initiatives
Maintain A Solid Financial Foundation Strategic and Operating Initiatives Growth and Operating Initiatives • Capital investments consistent with service initiatives and strategy • Invest in operational efficiencies and innovation • Selective tuck-in and strategic acquisitions Balanced Maintain Stron
Slide 24: ArcBest Diversification
Percent of ArcBest Revenue ArcBest Diversification Goal Growth of the Asset-Light Businesses An Ever-Increasing Percentage of ArcBest’s Revenue 50% 50% ArcBest Revenue $2,700 $2,613 $2,667 2016 $2,300 Asset-Light $2,066 30% $1,908 Asset-Based $1,658 70% $1,473 2009 7% 2009 2010 2011 2012 2013 2014 2
Slide 25: Strategies for Future Growth
Strategies for Future Growth Work toward strengthening the asset-based 1 foundation of ArcBest Sustained growth through new customer additions 2 and solutions selling with established base of over 40,000 active ArcBest customers How will ArcBest seek to grow its revenue to solve Continued developmen
Slide 26: Key Takeaways
Key Takeaways • ArcBest is a logistics company with creative problem solvers who deliver integrated supply chain solutions. • We own and control assets and offer unique access to guaranteed transportation capacity. • We consider the customer in everything we do through our focus on delivering a supe
Slide 27: Q&A
Q&A SKIL iLL ; ArcBest | »
Slide 28: ArcBest
℠ ARCBEST February 14, 2017 Stifel 2017 Transportation & Logistics Conference
ArcBest — Stifel 2017 Transportation & Logistics Conference on 6ix