Select Views of the North American Less than Truckload
Freight Transportation Marketplace
Past & Present,
Including Its 10-Largest & Publicly-held LTL Service Providers.
Thom A. Williams, managing director March 10, 2010
AmherstAlphaAdvisors LLC
Certain Objects of Our Attention:
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K and AmherstAlpha data extrapolations..
LTL Shipment VolumesOf the top 10 publicly-held LTL carriers, 2006 thru 2009
FDX, 17,085,000 FDX, 19,941,000
FDX, 20,323,500
FDX, 18,972,000
CNW, 14,544,893 CNW, 15,264,882
CNW, 14,854,580
CNW, 14,809,233
UPS, 9,638,000 UPS, 10,481,000
UPS, 10,036,000
UPS, 9,880,000
SAIA, 6,177,000 SAIA, 6,888,000
SAIA, 6,710,000
SAIA, 6,428,000
ODFL, 6,428,000 ODFL, 6,765,000
ODFL, 6,691,000
ODFL, 5,750,000
ABFS, 5,690,505 ABFS, 5,393,652
ABFS, 5,017,807
ABFS, 4,396,293
TFI (est.), 3,330,182 TFI (est.), 3,688,367
TFI (est.), 4,159,831
TFI (est.), 3,739,055
VTNC, 3,007,985
VTNC, 4,040,306
VTNC, 3,930,049
VTNC, 3,705,152
FWRD, 2,325,556
FWRD, 2,318,897
FWRD, 2,295,299
FWRD, 2,095,223
YRCW, 23,515,000
YRCW, 33,848,000 YRCW, 38,646,000
YRCW, 40,117,000
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
2006 2007 2008 2009
The Top 10'sTotal LTL Shipments
YRCW FDX CNW UPS SAIA ODFL ABFS TFI (est.) VTNC FWRDFiscal YE May 31st for FDX; all others are YE Dec. 31.
During 2009, these top 10 LTL providers carried 15.8 million fewer shipments (-13.9%) than they did in 2006. YRCW's dramatic 41.4% volume decline (i.e., in '09 YRCW had 16.6 million fewer shipments than in '06) surely helped the others remain afloat!
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
LTL Shipments vs. Retail Import Cargo Container TEU Volumes
YRCW
FDX
CNW
UPS
SAIA ODFL
AB
FSTF
I (es
t.) VTNC
FWRD0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
2006 2007 2008 2009
LTL Shipments,in 000s
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
10,000,000
11,000,000
12,000,000
13,000,000
14,000,000
15,000,000
16,000,000
17,000,000
Import Cargo ContainerTEU Volumes
YRCW FDX CNW UPS SAIA ODFL ABFS TFI (est.) VTNC FWRD NFR-PortTrackerRetail TEUs
While total LTL shipments carried by these top 10 declined ~14% from '06 thru '09, the National Retail Federation reports that total containers shipped to major U.S. retail container ports fell by ~23% during the same 3-year period.
NRF forecasts of container imports during 2010 change frequently, but still anticipate increases beyond the YE '09 volumes.
Fiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
LTL RevenuesOf the top 10 publicly-held LTL carriers, 2006 thru 2009
ODFL, $1,401,542 ODFL, $1,537,724
ODFL, $1,245,005
SAIA, $976,123 SAIA, $1,030,421
SAIA, $849,141
TFI, $488,790
TFI, $533,847 TFI, $646,653
TFI, $523,966
VTNC, $441,499
VTNC, $584,786 VTNC, $610,933
VTNC, $519,215
FWRD, $299,600
FWRD, $313,162 FWRD, $336,200
FWRD, $268,245
YRCW$8,446,149
YRCW$8,170,277 YRCW
$7,659,677 YRCW
$4,751,462
FDX$3,645,000
FDX$4,586,000 FDX
$4,934,000
FDX$4,415,000
CNW$2,852,909
CNW$2,904,543
CNW$3,015,959
CNW$2,574,300
UPS$1,831,000
UPS$2,013,000
UPS$2,062,000
UPS$1,943,000
ABFS$1,810,328
ABFS$1,770,749
ABFS$1,758,780
ABFS$1,384,419
ODFL, $1,279,431
SAIA, $874,738
$2.705
$2.882
$3.807
$2.467
$0
$2,500,000
$5,000,000
$7,500,000
$10,000,000
$12,500,000
$15,000,000
$17,500,000
$20,000,000
$22,500,000
$25,000,000
2006 2007 2008 2009
LTL RevenuesUS$s in thousands
$2.350
$2.550
$2.750
$2.950
$3.150
$3.350
$3.550
$3.750
Avg. On-road DieselPrice, US$s/gal.
YRCW FDX CNW UPS ABFS ODFL SAIA TFI VTNC FWRD DieselAvg.$/gal.Fiscal YE May 31st for FDX; all others are YE Dec. 31.
Fuel surcharge increases considerably masked declining shipments and otherwise dull revenue growths.
CAUSE FOR CONCERN: Recent proliferations of LTL-focused rate-comparison, bidding-program and LTL-consolidation software packages such as CzarLite, Bid$ense, DSi and others have quashed any pricing power leverages the LTL leaders held in earlier years!
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
2006 LTL Carriers' Relative MarketsharesHow the top 10 publicly-held LTL carriers divided US$22.7 billion of '06 LTL revenues:
UPS$1,831,000
8%
ABFS$1,810,328
8%
CNW$2,852,909
13%
FDX$3,645,000
16%
YRCW$9,207,200
40%
ODFL$1,279,431
6%
SAIA$874,738
4%TFI, $488,790 2%
VTNC, $441,499 2%
FWRD $299,600 1%
YRCW FDX CNW UPS ABFS ODFL SAIA TFI VTNC FWRD
UPS entered the LTL sector with its August '05 cash acquisition of Overnite Corp. for ~$1.25 billion. Overnite reported $1.4 billion of LTL Revenue and $63 million net income @ YE2004.
On 5/24/2005, YRCW acquired USF Corp. for ~$1.3 billion, $835.4 million in cash and 9 million shares of YRCW stock (valued at $51.62 per share). The USF acquisition increased YRCW's YE2005 revenue by ~$1.5 billion and YE2005 operating income by $59 million.
In a late 2003 display of acquisition hubris, YRCW paid ~$1.2 billion (~$1.08 bil. in cash and stock, plus ~$120 mil. in net debt) to buy Roadway Corp., which had YE2002 tangible net worth of $104 million and 2002 LTL revenues and net income of ~$2.8 billion and ~$35 million, respectively.And FDX acquired Watkins on 9/3/2006, for $787
million cash. Earlier, Watkins reported $1.1 billion of calendar-year '05 LTL revenue; the acquisition added ~$760 million to FDX's fiscal YE05/31/07 LTL revenues.
Fiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
2009 LTL Carriers' Relative MarketsharesHow the top 10 publicly-held LTL carriers divided US$18.4 billion of '09 LTL revenues:
TFI$515,168
3%SAIA$849,141
5%
ODFL$1,245,005
7%
YRCW$4,811,917
26%
FDX$4,415,000
24%
CNW$2,574,300
14%
ABFS$1,384,419
7%
UPS$1,943,000
10%
VTNC$519,215
3% FWRD$268,245
1%
YRCW FDX CNW UPS ABFS ODFL SAIA TFI VTNC FWRD
ABFS recorded a $64 million goodwill-intangible asset impairment charge in '09.
UPS recorded $584 million of write-downs to its Overniterelated goodwill-intangible assets during '08.
FDX recorded $90 million of write-downs to its Watkins-related goodwill-intangible assets during '09.
Saia booked $35.5 million of goodwill-intangible asset write-downs during '08, earlier established as the as result of three acquisitions.
During '08 Vitran wrote off $107.4 million of LTL acquisition-related goodwill-intangible assets.
In the three years following '06, YRCW recorded ~$1.8 billion of goodwill-intangible asset impairment charges, completely negating its USF and Roadway acquisition values. And,
Late in 2009 YRCW sold its only profitable operating segment (Dedicated Fleet), to Greatwide Logistics for ~$34 million; YRCW later reported that segment had revenue of ~$74 million and operating income of ~$7 million for YE2009.
Fiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
Changes in LTL Revenues, YE 2009 vs. YE 2006
YRCW, -$3,695
ABFS, -$426
CNW, -$279ODFL, -$34 FWRD, -$31 SAIA, -$26 UPS, -$24
TFI (est.), +$35 VTNC, +$78
FDX, +$770
($3,750)
($3,250)
($2,750)
($2,250)
($1,750)
($1,250)
($750)
($250)
$250
$750
1
Revenue loss or gain,2009 vs. 2006,US$s in millions
Fiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
LTL Revenue CAGRs, YE 2006 to YE 2009
FDXCAGR =+6.6%VTNC
CAGR =+5.6%
TFI (est.)
CAGR = +2.3%
UPSCAGR =
-0.4%
CNWCAGR =
-3.4%
FWRDCAGR =
-3.6%ODFL
CAGR =-0.9%
YRCWCAGR =-17.4%
SAIACAGR =
-1.0%ABFS
CAGR =-8.6%
-18.0%
-16.0%
-14.0%
-12.0%
-10.0%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
YRCW ABFS FWRD CNW SAIA ODFL UPS TFI (est.) VTNC FDX
LTL Revenues, Compounded Annual Growth Rate (+ or -), YE '06 to YE '09
As the noted transport industry analysts John Larkin and David Ross, of Stifel Nicolaus, recently asked:"Which is the prettiest house in this ugly neighborhood?"
Fiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
LTL Operating Incomes(after deductions for LTL-specific intangible asset and goodwill impairment charges)
YRCW-$899
AB
FS, -
$169 FD
X, -$
44
SAIA
, -$4
VTN
C, -
$3TF
I (es
t.), $
22
FWR
D, $
27
CN
W, $
51
OD
FL, $
70
UPS
, $77
($1,100)
($900)
($700)
($500)
($300)
($100)
$100
$300
$500
2006 2007 2008 2009
LTL OperatingProfit or (Loss), US$s in millions
YRCW ABFS FDX SAIA VTNC TFI (est.) FWRD CNW ODFL UPSFiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
LTL Operating Income per LTL Shipment(after deductions for LTL-specific intangible asset and goodwill impairment charges)
YRCW($38.23)
YRCW($31.73)
YRCW($14.62)
FDX($2.32)
CNW$3.46
UPS($43.76)
UPS$30.08
ABFS($38.37)
ODFL$12.24
SAIA($0.57)
SAIA($1.47)
TFI(est.)$5.98
VTNC($0.71)
VTNC($25.03)
FWRD$12.93
($45.00)
($40.00)
($35.00)
($30.00)
($25.00)
($20.00)
($15.00)
($10.00)
($5.00)
$0.00
$5.00
$10.00
$15.00
$20.00
$25.00
$30.00
$35.00
2006 2007 2008 2009
LTL Operating Profit,per LTL Shipment
US$s
YRCW FDX CNW UPS ABFS ODFL SAIA TFI (est.) VTNC FWRDFiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
LTL Operating Income per LTL Shipment(excluding deductions for LTL-specific intangible asset and goodwill impairment charges)
YRCW($36.94)
ABFS($23.83)
VTN
C, (
$0.7
1)
SAIA
, ($0
.57)
FDX,
$2.
42
CN
W, $
3.46
TFI (
est.)
, $5.
98
UPS
, $7.
82
OD
FL, $
12.2
4
FWR
D, $
13.0
3
($38.00)
($30.00)
($22.00)
($14.00)
($6.00)
$2.00
$10.00
$18.00
$26.00
$34.00
2006 2007 2008 2009
LTL Operating Profitor (Loss) perLTL Shipment, US$s
YRCW ABFS VTNC SAIA FDX CNW TFI (est.) UPS ODFL FWRDFiscal YE May 31st for FDX; all others are YE Dec. 31.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
LTL Revenue per LTL Shipment
YRC
W
FDX
CN
W UPS
AB
FS
OD
FLSA
IA
TFI (
est.)
VTN
C
FWR
D
$2.705
$2.882
$3.807
$2.467
$0.00
$50.00
$100.00
$150.00
$200.00
$250.00
$300.00
$350.00
2006 2007 2008 2009
LTL Revenue perLTL Shipment, US$s
$1.000
$1.250
$1.500
$1.750
$2.000
$2.250
$2.500
$2.750
$3.000
$3.250
$3.500
$3.750
$4.000
Avg. On-roadDiesel, US$s/gal.
YRCW FDX CNW UPS ABFS ODFL SAIA TFI (est.) VTNC FWRD DieselAvg.$/gal.Fiscal YE May 31st for FDX; all others are YE Dec. 31.
FDX and ODFL each achieved an approx. 9% total increase in avg. revenue per shipment over the past3 years; all others suffered declines.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
Publicly-held North American LTL Carriers - Market Values on March 9, 2010
UPS, $63,200
FDX, $28,480
CNW, $1,720
ODFL, $1,240
TFI, $941
FWRD, $763
ABFS, $741
YRCW, $525
SAIA, $189
VTNC, $188
0.00 0.01 0.10 1.00 10.00 100.00 1,000.00 10,000.00 100,000.00
Market Capitalization@ 3/09/2009, US$s in millions
SPECIAL NOTE: This a 2 decimal point logarithmic scale, from Zero to $100.00 billion ($100,000.00 millions).
SPECIAL NOTE as to both FDX and UPS:Though here included in this summary of publicly-held LTL carriers' market capitalization, LTL operations play only small roles in the "totalities" of FDX and UPS. I.e., during YE 2009 LTL business generated just 12.4% of FDX's $35.5 billion of total revenue, and just 4.0% of UPS's $45.3 billion revenue total.
AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.
Biggest Winners of Late in the North American LTL Sector:
The former shareholders ofUSF Corp. received~$1.3 billion from YRCW
The former shareholders of Overnite Corp. received~$1.25 billion from UPS
The former shareholders ofWatkins received~$787 million from FDX
The former shareholders ofPJAX received$116 million from VTNC
The former shareholders of ChrisTrucking received$31 million from VTNC
$0 $100 $200 $300 $400 $500 $600 $700 $800 $900 $1,000 $1,100 $1,200 $1,300 $1,400
Sellers Receivedthese sale proceeds,US$s in millions
Recently, the only big winners in the LTL sector have been those
owners who found eager buyers, accepted their offers, cashed in
their chips, and went home!
AmherstAlphaAdvisors LLC
While Major and Minor Shippers Use Increasingly Sophisticated Tools to LTL Carriers’
Pricing Disadvantage:
Q & A
For further details and/or inquiries, please contact: