ODFL
#No, no, not at all.
I think we have a strong organizational structure that we do both.
And keep in mind we are in fact doing both.
We have repurchased about just under $28 million of shares since its effective date in December currently, and that's on the, even though we've indicated $460 million of CapEx.
So we will still do both.
Executing and investing in growth in terms of our network, et cetera, and while also looking at returning some proceeds to shareholders in terms of a we purchase.
So I think our balance sheet, our profitability and margins allow us to do both and we continue to look at that.
We see that that's fairly normal.
That includes our DIPD coverage in that line as well as our cargo claims, and we've been very active in managing both of those expenses, and we continue to see that as being a positive number.
Whether it goes down or up as a percent of revenue, as we pointed out in our script, the optics of that isn't as much as you think since our-.
We showed it going from 1.3% to 1.4% but the revenue is down because of the fuel surcharge.
Right.
So the number is actually better as a percent of pre-fuel is your charge revenue.
And that's a good point.
I would say probably it's more flattish.
But I think that's a range we expect to maintain this year.
Good morning, <UNK>.
<UNK>, I don't think, you know, as far as we're concerned, we've not seen any effect on our relationships with the 3PLs that we do business with.
Our stamps on how we work with 3PLs will remain the same, and we've had a successful relationship with our 3PLs.
Our mix of brands is the same this year as it has been the last couple of years, from the tractor standpoint.
Trailers are about the same.
There's nothing in particular different in any major way.
Mix of engines and the whole thing, it's all about the same.
And we're testing some automatic transmissions or what do they call it, semi automatic transmissions, but we're not, you know, haven't moved ahead with anything in a big way on that.
We've been watching the whole natural gas evolution for the last several years, and we're definitely on a wait and see approach.
We don't think that we're ready for that or that's ready for us.
Keep in mind, <UNK>, that our tractors that are used in the P and D routes were previously line haul tractors as we get the ten-year economic life.
So we do not buy a separate pickup and delivery fleet so that makes it a little more cumbersome to try.
And line haul, clearly, natural gas just isn't even close to being practical for us, as I assume for the industry.
Good morning.
On your first question, yeah, we did realize a little bit of tail wind in the first quarter, maybe 20 basis points to 40 basis points on the fuel.
We expect that to reverse to a slight headwind as the year progresses and as fuel costs start to go up and fuel surcharge perhaps lags that a little bit.
So, yeah, that was our currents.
And what was your other question again, <UNK>.
About the fuel surcharge and the customers.
We've not had, honestly, not a lot of, you know, direct feedback nor any way to really measure whether our stance of not taking increases on our fuel surcharge tables, whether that has contributed to mark share gains.
We really, it's impossible to measure that.
I would just say that our 559, which is where that would have affected, saw pretty nice growth in the first quarter, so maybe.
Not necessarily above what would be the overall.
It's hard to make a conclusion that we got additional, but we still think that that was the fair thing for us and the right thing for us to do.
We had not given that guidance.
Correct.
We have a lower weight per shipment in the first quarter, and I think our incremental margin was 30%.
(Inaudible) by that versus overall yield and density across the network, I think yield and density across the network were more influential to our 200 basis point improvement in OR.
But it would have maybe a slight negative effect on incremental margin in that we do haul shipments, so we're hauling more shipments, which means that you've got more movement on that, but the impact would have been minimal, as <UNK> points out, the real question is, are you getting appropriately compensated in terms of yield.
And certainly we have and expect to.
It's been relatively constant, although our overnight and second day is growing perhaps slightly more than our longer haul.
And that's kind of been the trend.
But other than that, we haven't seen any sudden or significant shifts in that.
We are keeping our trailers, our Pup trailers, in the range of, I think it's 18 or 20 years.
Is that about right, <UNK>, somewhere in that neighborhood.
Yeah.
So I think you would probably only make a conversion if they were less than ten years old, would be my, that's just my educated guess right now.
It could go either way.
Even at a, sequentially our tonnage will be obviously higher in the second quarter than the first.
And year-over-year we've already discussed 9% to 10% tonnage growth.
And even more shipments growth.
Keep in mind that probably the more comparable metric is number of shipments growth with respect to employees, not tonnage growth, because we actually move shipments, not necessarily tonnage.
So it takes, so we anticipate that the tonnage growth, that the shipment growth will be higher.
And that means you've got to have the people in place to move it.
Yeah, well definitely be, you know, adding people during this second quarter because June will be another peak month.
Just like March is the peak month to the first quarter, June says the peak month to the second quarter and we've got to be getting geared up to be able to handle the volumes in June.
And then we hope everybody takes a little bit of a vacation in July and then here we go again with the next peak in September.
Keep in mind you don't, the percentage isn't necessarily relevant.
I mean, if you've got a customer and you want to, and you need to run, say it's a new customer.
You only get a sampling of that shipment to see if the cube the weight per cube is what was agreed on from a pricing standpoint.
If I had to guess, I would say 30% to 40% of our shipments go through a dimensioner.
On a daily basis.
Well, keep in mind expedited doesn't necessarily mean next day.
Expedite is expedite regardless of the length of haul.
If we have a customer that needs a shipment going from the East Coast to the <UNK>t Coast, that's expedited but that's not necessarily having anything to do with the transit time.
It's with the immediacy of the shipment.
So that wouldn't necessarily be the reason why our next day shipments are, as a percent of overall has increased.
It's just one of the things, it is growth, continued growth in our regional, obviously, business, but it's not necessarily expedited.
Faster.
Yes, it has.
Yes, it has and I'm not sure how you know that number because we don't disclose that amount of detail.
Coming off a lower base of revenue, too, that's why the percentage growth might be faster.
I think, as long as the macro is in place, doing okay, as long as we see continued discipline from a pricing standpoint, and assuming that we still have the density improvements, all of which we think is the case, there's no reason why we are, our incremental margin wouldn't be definitely at the high end range and of course it's been above that with those ingredients in place.
For it to get to the low range, I think we would have to see all of those things having a negative effect and therefore just not doing well.
And that's for you and the economists to decide if that ever happens.
But that would be the reason why it would ever get down to the low end of that range, would be because of those factors, being not positive.
