EX-99.1 2 ex-99d1.htm EX-99.1 DSKE_20180809_EX_99_1

Exhibit 99.1

 

Picture 5

 

Daseke Reports Record Second Quarter 2018 Results and Increases Full-Year Outlook

Addison,  Texas –  August 9,  2018  –  Daseke, Inc. (NASDAQ: DSKE) (NASDAQ: DSKEW), the largest flatbed, specialized transportation and logistics solutions company in North America, today reported financial results for the second quarter ended June 30,  2018.

 

Second Quarter 2018  Highlights vs. Same Year-Ago Quarter

·

Revenue increased 91% to $376.9 million.

·

Flatbed Solutions revenue up 87% to $162.2 million; Specialized Solutions revenue up 95% to $218.4 million1.

·

Net income improved significantly to $13.5 million, or $0.20 per share, compared to a net loss of $(4.1) million, or $(0.15) per share.

·

Adjusted EBITDA (a non-GAAP term defined below) increased 91% to $46.3 million.

Management Commentary

“The momentum in our business has continued into the second quarter, with strong growth in revenue and Adjusted EBITDA,” said Don Daseke, chairman and CEO. “This was driven by year-over-year rate increases and growth in revenue per tractor in both the Flatbed and Specialized Solutions segments, excluding acquisitions. Our progress on various organic growth initiatives was also evident in a 13% increase in Acquisition-Adjusted2 EBITDA to $48.1 million.

 

“Further, in May 2018, we launched Daseke Fleet Services to support our growing scale, leveraging areas such as purchasing, equipment optimization and maintenance to improve cost efficiencies in ways that support our operating companies and Daseke’s overall organic growth. We expect this new department to reduce operating expenses, which would improve our operating income and margins.

 

“Given our strong performance in the first half of 2018, including organic growth from acquisitions, we are raising our full-year outlook. Our focus for the remainder of the year will be to continue executing on our well-defined strategic priorities. This begins with a focus on our organic growth initiatives, such as Daseke Fleet Services, and appropriate operations consolidations as we did with Kelsey Trail and Big Freight. We also remain committed to a focused M&A strategy and our pipeline remains robust. In fact, our acquisition of flatbed-focused Builders Transportation last week is a testament to our pipeline and our scalable platform.”

 

Second Quarter 2018  Financial Results

Revenue in the second quarter of 2018 increased 91% to $376.9 million compared to $197.3 million in the year-ago quarter. The increase was primarily driven by the acquisition of seven operating companies of scale during 2017. Excluding the acquisitions, revenues increased 13%  largely due to an improvement in rates in both the Flatbed and Specialized segments.

 

 

1  Net of eliminations, Flatbed Solutions revenue was $160.9 million and Specialized Solutions revenue was $216.0 million.

2  See Non-GAAP Measures for more information regarding Acquisition Adjusted measures.

 

 

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Net income in the second quarter of 2018 improved significantly to $13.5 million, or $0.20  per share, compared to a net loss of $(4.1) million, or $(0.15) per share, in the second quarter of 2017. This also compares to Acquisition Adjusted net loss in the second quarter of 2017 of $(1.3) million.

 

Adjusted EBITDA  increased 91% to $46.3 million compared to $24.3 million in the second quarter of 2017 and compared to Acquisition Adjusted EBITDA in the second quarter of 2017 of $41.6 million.  Both the significant improvements in net loss and Adjusted EBITDA were primarily driven by the aforementioned acquisitions.

 

Segment Results

Flatbed Solutions - Flatbed Solutions revenue in the second quarter of 2018 increased 87% to $162.2 million1 compared to $86.9 million in the year-ago quarter. This was driven by the acquisition of TSH & Co. on December 1, 2017, as well as a  13% increase in flatbed rate per mile and 7% growth in revenue per tractor.  Excluding the impact of acquisitions, rates were up 14% compared to the year-ago quarter. Operating income was $9.3 million, up 47% from $6.3 million in the second quarter of 2017.

 

Specialized Solutions - Specialized Solutions revenue in the second quarter of 2018 increased 95% to $218.4 million1 compared to $112.0 million in the year-ago quarter. The increase was driven by six specialized acquisitions of scale since May 2017, as well as a  10% increase in specialized rate per mile and 17% growth in revenue per tractor.  Excluding the impact of acquisitions, rates were up 5% compared to the year-ago quarter. Operating income was $7.1 million, up 55% from $4.6 million in the second quarter of 2017.

 

Increased 2018 Outlook

Daseke now expects revenue in 2018 to be approximately $1.55 billion (up from $1.35 billion prior estimate)  compared to $846.3 million in 2017, and Adjusted EBITDA to increase 85% to approximately $170 million ($150 million prior estimate)  compared to $91.9  million in 2017. Net replacement capital expenditures in 2018 are now expected to be approximately $90 million when including newly acquired companies..

 

Conference Call

Daseke will hold a conference call today at 11:00 a.m. Eastern time to discuss its second quarter 2018 results.

 

Date: Thursday,  August 9, 2018

Time: 11:00 a.m. Eastern time (10:00 a.m. Central time)

Toll-free dial-in number: 1-855-242-9918

International dial-in number: 1-414-238-9803

Conference ID: 2077036

 

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios at 1-949-574-3860.

 

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The conference call will be broadcast live and available for replay here and via the investor relations section of the Company’s website at investor.daseke.com.

 

A replay of the conference call will be available after 2:00 p.m. Eastern time on the same day through August  23, 2018.

 

Toll-free replay number: 1-855-859-2056

International replay number: 1-404-537-3406

Replay ID: 2077036

 

About Daseke, Inc.

Daseke Inc. is a leading consolidator and the largest owner of flatbed and specialized transportation and logistics capacity in North America. Daseke offers comprehensive, best-in-class services to many of the world’s most respected industrial shippers through experienced people, more than 5,500 tractors, more than 11,500 flatbed and specialized trailers, and million-plus square feet of industrial warehousing space. Daseke is uniquely positioned as the largest carrier, yet has only a small percent market share, of the highly fragmented flatbed and specialized transportation market. For more information, please visit www.daseke.com.

 

Use of Non-GAAP Measures

This news release includes non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDAR and Acquisition Adjusted, revenue, net loss and EBITDA (Acquisition Adjusted Measures). Other companies in Daseke’s industry may define these non-GAAP measures differently than Daseke does, and as a result, it may be difficult to use these non-GAAP measures to compare the performance of those companies to Daseke’s performance. Daseke’s management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP and instead relies primarily on Daseke’s GAAP results and uses non-GAAP measures supplementally.

 

Daseke defines Adjusted EBITDA as net income (loss) plus (i) depreciation and amortization, (ii) interest expense, including other fees and charges associated with indebtedness, net of interest income, (iii) income taxes, (iv) acquisition-related transaction expenses (including due diligence costs, legal, accounting and other advisory fees and costs, retention and severance payments and financing fees and expenses), (v) stock-based compensation, (vi) non-cash impairments, and (vii) expenses related to the business combination that was consummated in February 2017 and related transactions. Daseke defines Adjusted EBITDAR as Adjusted EBITDA plus tractor operating lease charges, and free cash flow as Adjusted EBITDA less net capital expenditures (capital expenditures less proceeds from equipment sales). Daseke defines Acquisition Adjusted as (a) our actual revenue, net loss or Adjusted EBITDA, as applicable, for the applicable measurement period and (b) the actual revenue, net loss or Adjusted EBITDA, as applicable, of each company acquired in 2017 or 2018, for the period beginning January 1, 2017 and ending on its acquisition date, based on the company’s internal financial statements for the period prior to Daseke’s acquisition. These adjusted amounts (i) have not been prepared in accordance with the requirements of Regulation S-X or any other securities laws relating to the presentation of pro forma financial information, (ii) do not reflect any pro forma adjustments, (iii) are presented for informational purposes only, (iv) are not necessarily indicative of what our result of operations would

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have been had such acquisitions been completed on January 1, 2017, and (v) do not purport to project our future operating results.

 

Daseke’s board of directors and executive management team use Adjusted EBITDA, Adjusted EBITDAR and Acquisition Adjusted Measures as key measures of its performance and for business planning. Adjusted EBITDA, Adjusted EBITDAR and Acquisition Adjusted Measures assist them in comparing Daseke’s operating performance over various reporting periods on a consistent basis because they remove from Daseke’s operating results the impact of items that, in their opinion, do not reflect Daseke’s core operating performance. Adjusted EBITDA,  Adjusted EBITDAR and Acquisition Adjusted Measures also allows Daseke to more effectively evaluate its operating performance by allowing it to compare the results of operations against its peers without regard to its or its peers’ financing method or capital structure.

 

Adjusted EBITDAR is used to view operating results before lease charges as these charges can vary widely among trucking companies due to differences in the way that trucking companies finance their fleet acquisitions. Daseke’s method of computing Adjusted EBITDA is substantially consistent with that used in its debt covenants and also is routinely reviewed by its management for that purpose.

 

Daseke believes its presentation of Adjusted EBITDA,  Adjusted EBITDAR and Acquisition Adjusted Measures is useful because they provide investors and industry analysts the same information that Daseke uses internally for purposes of assessing its core operating performance. However, Adjusted EBITDA,  Adjusted EBITDAR and Acquisition Adjusted Measures are not substitutes for, or more meaningful than, net income (loss), cash flows from operating activities, operating income or any other measure prescribed by GAAP, and there are limitations to using non-GAAP measures such as Adjusted EBITDA,  Adjusted EBITDAR and Acquisition Adjusted Measures. Certain items excluded from Adjusted EBITDA,  Adjusted EBITDAR and Acquisition Adjusted Measures are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital, tax structure and the historic costs of depreciable assets. Adjusted EBITDA, Adjusted EBITDAR and Acquisition Adjusted Measures should not be considered measures of the income generated by Daseke’s business or discretionary cash available to it to invest in the growth of its business.

 

Daseke’s board of directors and executive management team use free cash flow to assess the Company’s performance and ability to fund operations and make additional investments. Free cash flow represents the cash that its business generates from operations, before taking into account cash movements that are nonoperational. Daseke believes its presentation of free cash flow is useful because it is one of several indicators of Daseke’s ability to service debt, make investments and/or return capital to its stockholders. Daseke also believes that free cash flow is one of several benchmarks used by investors and industry analysts for comparison of performance in its industry, although Daseke’s measure of free cash flow may not be directly comparable to similar measures reported by other companies. Furthermore, free cash flow is not a substitute for, or more meaningful than, net income (loss), cash flows from operating activities, operating income or any other measure prescribed by GAAP, and there are limitations to using non-GAAP measures such as free cash flow. Accordingly, free cash flow should not be considered a measure of the income generated by Daseke’s business or discretionary cash available to it to invest in the growth of its business.

 

Daseke defines adjusted operating ratio as (a) total operating expenses (i) less fuel surcharges, acquisition related transaction expenses, non-cash impairment charges and withdrawn initial public

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offering-related expenses and (ii) further adjusted for the net impact of the step-up in basis resulting from acquisitions (such as increased depreciation and amortization expense), as a percentage of (b) total revenue excluding fuel surcharge revenue.

 

Daseke’s board of directors and executive management team view adjusted operating ratio, and its key drivers of revenue quality, growth, expense control and operating efficiency, as a very important measure of Daseke’s performance. Daseke believes fuel surcharge is often volatile and eliminating the impact of this source of revenue (by eliminating fuel surcharge from revenue and by netting fuel surcharge against fuel expense) affords a more consistent basis for comparing its results of operations between periods. Daseke also believes excluding acquisition-related transaction expenses, additional depreciation and amortization expenses as a result of acquisitions, non-cash impairments and withdrawn initial public offering-related expenses enhances the comparability of its performance between periods.

 

Daseke believes its presentation of adjusted operating ratio is useful because it provides investors and industry analysts the same information that Daseke uses internally for purposes of assessing its core operating profitability. However, adjusted operating ratio is not a substitute for, or more meaningful than, operating ratio, operating margin or any other measure derived solely from GAAP measures, and there are limitations to using non-GAAP measures such as adjusted operating ratio. You can find the reconciliation of these non-GAAP measures to the nearest comparable GAAP measures in the Reconciliation of Non-GAAP Measures tables below. We have not reconciled non-GAAP forward looking measures to their corresponding GAAP measures because certain items that impact these measures are unavailable or cannot be reasonably predicted without unreasonable efforts.

 

Forward-Looking Statements

This news release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “seek,” “target,” “will” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements are based on current information and expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. You should not place undue reliance on these forward-looking statements. As a result of a number of known and unknown risks and uncertainties, actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include, but are not limited to, general economic risks (such as downturns in customers’ business cycles and disruptions in capital and credit markets), driver shortages and increases in driver compensation or owner-operator contracted rates, loss of senior management or key operating personnel, our ability to recognize the anticipated benefits of recent acquisitions, and the Aveda transaction, if consummated, our ability to identify and execute future acquisitions successfully, our ability to consummate the Aveda transaction, seasonality and the impact of weather and other catastrophic events, fluctuations in the price or availability of diesel fuel, increased prices for, or decreases in the availability of, new revenue equipment

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and decreases in the value of used revenue equipment, our ability to generate sufficient cash to service all of our indebtedness, restrictions in our existing and future debt agreements, increases in interest rates, the impact of governmental regulations and other governmental actions related to the Company and its operations, litigation and governmental proceedings, and insurance and claims expenses. For additional information regarding known material factors that could cause our actual results to differ from those expressed in forward-looking statements, please see our filings with the Securities and Exchange Commission , available at www.sec.gov, including our Annual Report on Form 10-K for the year ended December 31, 2017, particularly the section “Risk Factors”.

 

Investor Relations:

Liolios Group

Cody Slach or Sean Mansouri

Tel 1-949-574-3860

DSKE@liolios.com

 

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Daseke, Inc. and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

(In thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

June 30, 

 

December 31, 

 

 

    

2018

    

2017

 

ASSETS

 

 

 

 

 

 

 

Current assets:

 

 

  

 

 

  

 

Cash and cash equivalents

 

$

78,734

 

$

90,679

 

Accounts receivable, net

 

 

195,606

 

 

127,368

 

Drivers’ advances and other receivables

 

 

5,215

 

 

4,792

 

Current portion of net investment in sales-type leases

 

 

13,346

 

 

10,979

 

Parts supplies

 

 

5,040

 

 

4,653

 

Prepaid and other current assets

 

 

34,433

 

 

28,240

 

Total current assets

 

 

332,374

 

 

266,711

 

Property and equipment, net

 

 

501,120

 

 

429,639

 

Intangible assets, net

 

 

186,857

 

 

93,120

 

Goodwill

 

 

264,025

 

 

302,702

 

Other long-term assets

 

 

39,726

 

 

33,496

 

Total assets

 

$

1,324,102

 

$

1,125,668

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

Current liabilities:

 

 

  

 

 

  

 

Accounts payable

 

$

29,057

 

$

12,488

 

Accrued expenses and other liabilities

 

 

46,319

 

 

25,876

 

Accrued payroll, benefits and related taxes

 

 

16,330

 

 

14,004

 

Accrued insurance and claims

 

 

12,236

 

 

12,644

 

Current portion of long-term debt

 

 

48,022

 

 

43,056

 

Total current liabilities

 

 

151,964

 

 

108,068

 

Line of credit

 

 

 —

 

 

4,561

 

Long-term debt, net of current portion

 

 

567,378

 

 

569,740

 

Deferred tax liabilities

 

 

121,513

 

 

90,434

 

Other long-term liabilities

 

 

20,985

 

 

1,632

 

Total liabilities

 

 

861,840

 

 

774,435

 

Commitments and contingencies

 

 

  

 

 

  

 

Stockholders’ equity:

 

 

  

 

 

  

 

Series A convertible preferred stock, $0.0001 par value; 10,000,000 shares authorized; 650,000 shares issued with liquidation preference of $65,000 at June 30, 2018 and December 31, 2017

 

 

65,000

 

 

65,000

 

Common stock, par value $0.0001 per share; 250,000,000 shares authorized, 63,875,267 and 48,712,288 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively

 

 

 6

 

 

 5

 

Additional paid-in-capital

 

 

427,892

 

 

277,931

 

Retained earnings (accumulated deficit)

 

 

(30,652)

 

 

7,338

 

Accumulated other comprehensive income

 

 

16

 

 

959

 

Total stockholders’ equity

 

 

462,262

 

 

351,233

 

Total liabilities and stockholders’ equity

 

$

1,324,102

 

$

1,125,668

 

 

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Daseke, Inc. and Subsidiaries

Consolidated Statements of Operations and Comprehensive Income (Loss)

(Unaudited)

(In thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30, 

 

June 30, 

 

 

    

2018

    

2017

    

2018

    

2017

 

Revenues:

 

 

  

 

 

  

 

 

  

 

 

  

 

Freight

 

$

272,583

 

$

149,654

 

$

512,654

 

$

275,209

 

Brokerage

 

 

60,091

 

 

28,656

 

 

106,229

 

 

49,525

 

Logistics

 

 

8,891

 

 

2,700

 

 

19,609

 

 

2,700

 

Fuel surcharge

 

 

35,334

 

 

16,313

 

 

65,988

 

 

30,323

 

Total revenue

 

 

376,899

 

 

197,323

 

 

704,480

 

 

357,757

 

Operating expenses:

 

 

  

 

 

  

 

 

  

 

 

  

 

Salaries, wages and employee benefits

 

 

90,614

 

 

58,186

 

 

172,959

 

 

108,307

 

Fuel

 

 

31,359

 

 

20,466

 

 

64,735

 

 

39,689

 

Operations and maintenance

 

 

40,465

 

 

28,967

 

 

75,028

 

 

52,191

 

Communications

 

 

807

 

 

549

 

 

1,506

 

 

952

 

Purchased freight

 

 

141,582

 

 

49,760

 

 

259,305

 

 

87,346

 

Administrative expenses

 

 

13,077

 

 

8,022

 

 

25,214

 

 

15,400

 

Sales and marketing

 

 

651

 

 

555

 

 

1,287

 

 

937

 

Taxes and licenses

 

 

3,890

 

 

2,611

 

 

7,584

 

 

4,892

 

Insurance and claims

 

 

10,428

 

 

5,042

 

 

19,612

 

 

9,165

 

Acquisition-related transaction expenses

 

 

1,402

 

 

1,037

 

 

1,842

 

 

1,483

 

Depreciation and amortization

 

 

31,766

 

 

17,638

 

 

56,948

 

 

33,953

 

(Gain) loss on disposition of revenue property and equipment

 

 

(490)

 

 

26

 

 

(645)

 

 

(174)

 

Impairment

 

 

2,840

 

 

 —

 

 

2,840

 

 

 —

 

Total operating expenses

 

 

368,391

 

 

192,859

 

 

688,215

 

 

354,141

 

Income from operations

 

 

8,508

 

 

4,464

 

 

16,265

 

 

3,616

 

Other expense (income):

 

 

  

 

 

  

 

 

  

 

 

  

 

Interest income

 

 

(601)

 

 

(50)

 

 

(1,042)

 

 

(54)

 

Interest expense

 

 

11,070

 

 

6,544

 

 

21,407

 

 

12,440

 

Write-off of unamortized deferred financing fees

 

 

 —

 

 

 —

 

 

 —

 

 

3,883

 

Other

 

 

(900)

 

 

(107)

 

 

(1,859)

 

 

(215)

 

Total other expense

 

 

9,569

 

 

6,387

 

 

18,506

 

 

16,054

 

Loss before provision (benefit) for income taxes

 

 

(1,061)

 

 

(1,923)

 

 

(2,241)

 

 

(12,438)

 

Provision (benefit) for income taxes

 

 

(14,546)

 

 

2,184

 

 

(14,929)

 

 

(586)

 

Net income (loss)

 

 

13,485

 

 

(4,107)

 

 

12,688

 

 

(11,852)

 

Other comprehensive income (loss):

 

 

  

 

 

  

 

 

  

 

 

  

 

Unrealized income on interest rate swaps

 

 

 —

 

 

 —

 

 

 —

 

 

52

 

Foreign currency translation adjustments, net of tax expense (benefit) of $(78), $274, $(251) and $274, respectively

 

 

(623)

 

 

507

 

 

(943)

 

 

507

 

Comprehensive income (loss)

 

 

12,862

 

 

(3,600)

 

 

11,745

 

 

(11,293)

 

Net income (loss)

 

 

13,485

 

 

(4,107)

 

 

12,688

 

 

(11,852)

 

Less dividends to Series A convertible preferred stockholders

 

 

(1,239)

 

 

(1,693)

 

 

(2,478)

 

 

(1,694)

 

Less dividends to Series B convertible preferred stockholders

 

 

 —

 

 

 —

 

 

 —

 

 

(806)

 

Net income (loss) attributable to common stockholders

 

$

12,246

 

$

(5,800)

 

$

10,210

 

$

(14,352)

 

Net income (loss) per common share:

 

 

  

 

 

  

 

 

  

 

 

  

 

Basic

 

$

0.20

 

$

(0.15)

 

$

0.17

 

$

(0.44)

 

Diluted

 

$

0.20

 

$

(0.15)

 

$

0.17

 

$

(0.44)

 

Weighted-average common shares outstanding:

 

 

  

 

 

  

 

 

  

 

 

  

 

Basic

 

 

60,558,956

 

 

37,954,310

 

 

57,944,688

 

 

32,468,674

 

Diluted

 

 

60,558,956

 

 

37,954,310

 

 

57,944,688

 

 

32,468,674

 

Dividends declared per Series A convertible preferred share

 

$

1.91

 

$

0.68

 

$

3.81

 

$

0.68

 

Dividends declared per Series B convertible preferred share

 

$

 —

 

$

 —

 

$

 —

 

$

12.50

 

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Daseke, Inc. and Subsidiaries

Supplemental Information: Flatbed Solutions

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 

 

 

 

 

 

 

 

 

2018

 

2017

 

Increase (Decrease)

 

(Dollars in thousands)

    

$

    

%

    

$

    

%

    

$

    

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUE(1):

 

 

  

 

  

 

 

  

 

  

 

 

  

 

  

 

Freight

 

$

118,486

 

73.1

 

$

68,889

 

79.3

 

$

49,597

 

72.0

 

Brokerage

 

 

23,875

 

14.7

 

 

9,495

 

10.9

 

 

14,380

 

151.4

 

Logistics

 

 

693

 

0.4

 

 

 —

 

*

 

 

693

 

*

 

Fuel surcharge

 

 

19,125

 

11.8

 

 

8,514

 

9.8

 

 

10,611

 

124.6

 

Total revenue

 

 

162,179

 

100.0

 

 

86,898

 

100.0

 

 

75,281

 

86.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES(1):

 

 

  

 

 

 

 

  

 

 

 

 

  

 

 

 

Total operating expenses

 

 

152,910

 

94.3

 

 

80,576

 

92.7

 

 

72,334

 

89.8

 

Operating ratio

 

 
94.3%

 

 

 

 
92.7%

 

 

 

 

 

 

 

 

Adjusted operating ratio

 

 
93.0%

 

 

 

 
91.6%

 

 

 

 

 

 

 

 

INCOME FROM OPERATIONS

 

$

9,269

 

5.7

 

$

6,322

 

7.3

 

$

2,947

 

46.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING STATISTICS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total miles

 

 

58,482,608

 

 

 

 

38,231,186

 

 

 

 

20,251,422

 

53.0

 

Company-operated tractors, at quarter-end

 

 

1,017

 

 

 

 

1,135

 

 

 

 

(118)

 

(10.4)

 

Owner-operated tractors, at quarter-end

 

 

1,574

 

 

 

 

472

 

 

 

 

1,102

 

233.5

 

Number of trailers, at quarter-end

 

 

4,404

 

 

 

 

2,877

 

 

 

 

1,527

 

53.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company-operated tractors, average for the quarter

 

 

1,061

 

 

 

 

1,144

 

 

 

 

(83)

 

(7.3)

 

Owner-operated tractors, average for the quarter

 

 

1,532

 

 

 

 

463

 

 

 

 

1,069

 

230.9

 

*      indicates not meaningful.

(1)

Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.

 

Page 9 of 15

 

Picture 3

 

Daseke, Inc. and Subsidiaries

Supplemental Information: Flatbed Solutions

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 

 

 

 

 

 

 

 

 

2018

 

2017

 

Increase (Decrease)

 

(Dollars in thousands)

    

$

    

%

    

$

    

%

    

$

    

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUE(1):

 

 

  

 

  

 

 

  

 

  

 

 

  

 

  

 

Freight

 

$

222,998

 

72.6

 

$

132,863

 

79.0

 

$

90,135

 

67.8

 

Brokerage

 

 

46,873

 

15.3

 

 

18,593

 

11.1

 

 

28,280

 

152.1

 

Logistics

 

 

1,407

 

0.5

 

 

 —

 

*

 

 

1,407

 

*

 

Fuel surcharge

 

 

35,909

 

11.7

 

 

16,746

 

10.0

 

 

19,163

 

114.4

 

Total revenue

 

 

307,187

 

100.0

 

 

168,202

 

100.0

 

 

138,985

 

82.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES(1):

 

 

  

 

 

 

 

  

 

 

 

 

  

 

 

 

Total operating expenses

 

 

290,955

 

94.7

 

 

158,001

 

93.9

 

 

132,954

 

84.1

 

Operating ratio

 

 
94.7%

 

 

 

 
93.9%

 

 

 

 

 

 

 

 

Adjusted operating ratio

 

 
93.6%

 

 

 

 
92.8%

 

 

 

 

 

 

 

 

INCOME FROM OPERATIONS

 

$

16,232

 

5.3

 

$

10,201

 

6.1

 

$

6,031

 

59.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING STATISTICS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total miles

 

 

116,341,393

 

 

 

 

75,672,073

 

 

 

 

40,669,320

 

53.7

 

Company-operated tractors, at quarter-end

 

 

1,017

 

 

 

 

1,135

 

 

 

 

(118)

 

(10.4)

 

Owner-operated tractors, at quarter-end

 

 

1,574

 

 

 

 

472

 

 

 

 

1,102

 

233.5

 

Number of trailers, at quarter-end

 

 

4,404

 

 

 

 

2,877

 

 

 

 

1,527

 

53.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company-operated tractors, average for the year

 

 

1,104

 

 

 

 

1,165

 

 

 

 

(61)

 

(5.2)

 

Owner-operated tractors, average for the year

 

 

1,481

 

 

 

 

447

 

 

 

 

1,034

 

231.3

 

*      indicates not meaningful.

(1)

Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.

Page 10 of 15

 

Picture 3

 

Daseke, Inc. and Subsidiaries

Supplemental Information: Specialized Solutions

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 

 

 

 

 

 

 

 

 

2018

 

2017

 

Increase (Decrease)

 

(Dollars in thousands)

    

$

    

%

    

$

    

%

    

$

    

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUE(1):

 

 

  

 

  

 

 

  

 

  

 

 

  

 

  

 

Freight

 

$

157,118

 

72.0

 

$

82,143

 

73.4

 

$

74,975

 

91.3

 

Brokerage

 

 

36,399

 

16.7

 

 

19,198

 

17.1

 

 

17,201

 

89.6

 

Logistics

 

 

8,236

 

3.8

 

 

2,708

 

2.4

 

 

5,528

 

204.1

 

Fuel surcharge

 

 

16,605

 

7.6

 

 

7,936

 

7.1

 

 

8,669

 

109.2

 

Total revenue

 

 

218,358

 

100.0

 

 

111,985

 

100.0

 

 

106,373

 

95.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES(1):

 

 

  

 

 

 

 

  

 

 

 

 

  

 

 

 

Total operating expenses

 

 

211,252

 

96.7

 

 

107,396

 

95.9

 

 

103,856

 

96.7

 

Operating ratio

 

 
96.7%

 

 

 

 
95.9%

 

 

 

 

 

 

 

 

Adjusted operating ratio

 

 
92.8%

 

 

 

 
93.8%

 

 

 

 

 

 

 

 

INCOME FROM OPERATIONS

 

$

7,106

 

3.3

 

$

4,589

 

4.1

 

$

2,517

 

54.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING STATISTICS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total miles

 

 

54,612,450

 

 

 

 

31,379,689

 

 

 

 

23,232,761

 

74.0

 

Company-operated tractors, at quarter-end

 

 

2,460

 

 

 

 

1,537

 

 

 

 

923

 

60.1

 

Owner-operated tractors, at quarter-end

 

 

611

 

 

 

 

282

 

 

 

 

329

 

116.7

 

Number of trailers, at quarter-end

 

 

8,210

 

 

 

 

4,525

 

 

 

 

3,685

 

81.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company-operated tractors, average for the quarter

 

 

2,159

 

 

 

 

1,393

 

 

 

 

766

 

55.0

 

Owner-operated tractors, average for the quarter

 

 

581

 

 

 

 

263

 

 

 

 

318

 

120.9

 

*      indicates not meaningful.

(1)

Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.

Page 11 of 15

 

Picture 3

 

 

Daseke, Inc. and Subsidiaries

Supplemental Information: Specialized Solutions

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 

 

 

 

 

 

 

 

 

2018

 

2017

 

Increase (Decrease)

 

(Dollars in thousands)

    

$

    

%

    

$

    

%

    

$

    

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUE(1):

 

 

  

 

  

 

 

  

 

  

 

 

  

 

  

 

Freight

 

$

294,627

 

73.1

 

$

145,118

 

75.3

 

$

149,509

 

103.0

 

Brokerage

 

 

59,589

 

14.8

 

 

30,968

 

16.1

 

 

28,621

 

92.4

 

Logistics

 

 

18,273

 

4.5

 

 

2,708

 

1.4

 

 

15,565

 

574.8

 

Fuel surcharge

 

 

30,757

 

7.6

 

 

13,864

 

7.2

 

 

16,893

 

121.8

 

Total revenue

 

 

403,246

 

100.0

 

 

192,658

 

100.0

 

 

210,588

 

109.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES(1):

 

 

  

 

 

 

 

  

 

 

 

 

  

 

 

 

Total operating expenses

 

 

390,995

 

97.0

 

 

187,062

 

97.1

 

 

203,933

 

109.0

 

Operating ratio

 

 
97.0%

 

 

 

 
97.1%

 

 

 

 

 

 

 

 

Adjusted operating ratio

 

 
93.7%

 

 

 

 
95.1%

 

 

 

 

 

 

 

 

INCOME FROM OPERATIONS

 

$

12,251

 

3.0

 

$

5,596

 

2.9

 

$

6,655

 

118.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING STATISTICS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total miles

 

 

106,085,604

 

 

 

 

56,019,551

 

 

 

 

50,066,053

 

89.4

 

Company-operated tractors, at quarter-end

 

 

2,460

 

 

 

 

1,537

 

 

 

 

923

 

60.1

 

Owner-operated tractors, at quarter-end

 

 

611

 

 

 

 

282

 

 

 

 

329

 

116.7

 

Number of trailers, at quarter-end

 

 

8,210

 

 

 

 

4,525

 

 

 

 

3,685

 

81.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company-operated tractors, average for the year

 

 

2,095

 

 

 

 

1,243

 

 

 

 

852

 

68.5

 

Owner-operated tractors, average for the year

 

 

570

 

 

 

 

238

 

 

 

 

332

 

139.5

 

*      indicates not meaningful.

(1)

Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.

Page 12 of 15

 

Picture 3

 

 

Daseke, Inc. and Subsidiaries

Reconciliation of Non-GAAP Measures

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 

 

Six Months Ended June 30, 

 

 

    

2018

    

2017

    

2018

    

2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

13,485

 

$

(4,107)

 

$

12,688

 

$

(11,852)

 

Depreciation and amortization

 

 

31,766

 

 

17,638

 

 

56,948

 

 

33,953

 

Interest income

 

 

(601)

 

 

(50)

 

 

(1,042)

 

 

(54)

 

Interest expense

 

 

11,070

 

 

6,544

 

 

21,407

 

 

12,440

 

Write-off of unamortized deferred financing fees

 

 

 —

 

 

 —

 

 

 —

 

 

3,883

 

Income tax provision (benefit)

 

 

(14,546)

 

 

2,184

 

 

(14,929)

 

 

(586)

 

Acquisition-related transaction expenses

 

 

1,402

 

 

1,037

 

 

1,842

 

 

1,483

 

Impairment

 

 

2,840

 

 

 —

 

 

2,840

 

 

 —

 

Stock based compensation

 

 

902

 

 

538

 

 

1,788

 

 

538

 

Expenses related to the Business Combination and related transactions

 

 

 —

 

 

481

 

 

 —

 

 

2,034

 

Tractor operating lease charges

 

 

4,718

 

 

4,004

 

 

9,261

 

 

7,816

 

Adjusted EBITDAR

 

$

51,036

 

$

28,269

 

$

90,803

 

$

49,655

 

Less tractor operating lease charges

 

 

(4,718)

 

 

(4,004)

 

 

(9,261)

 

 

(7,816)

 

Adjusted EBITDA

 

$

46,318

 

$

24,265

 

$

81,542

 

$

41,839

 

Net capital expenditures

 

 

(29,324)

 

 

(8,954)

 

 

(31,036)

 

 

(8,993)

 

Free cash flow

 

$

16,994

 

$

15,311

 

$

50,506

 

$

32,846

 

 

Page 13 of 15

 

Picture 3

 

 

Daseke, Inc. and Subsidiaries

Reconciliation of Operating Ratio to Adjusted Operating Ratio by Segment: Flatbed

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 

 

Six Months Ended June 30, 

 

(Dollars in thousands)

    

2018

    

2017

    

2018

    

2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue(1)

 

$

162,179

 

$

86,898

 

$

307,187

 

$

168,202

 

Fuel surcharge

 

 

19,125

 

 

8,514

 

 

35,909

 

 

16,746

 

Operating revenue, net of fuel surcharge

 

$

143,054

 

$

78,384

 

$

271,278

 

$

151,456

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expenses(1)

 

$

152,910

 

$

80,576

 

$

290,955

 

$

158,001

 

Fuel surcharge

 

 

19,125

 

 

8,514

 

 

35,909

 

 

16,746

 

Net impact of step-up in basis of acquired assets

 

 

771

 

 

290

 

 

1,222

 

 

661

 

Adjusted operating expenses

 

$

133,014

 

$

71,772

 

$

253,824

 

$

140,594

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating ratio

 

 
94.3%

 

 
92.7%

 

 
94.7%

 

 
93.9%

 

Adjusted operating ratio

 

 
93.0%

 

 
91.6%

 

 
93.6%

 

 
92.8%

 

(1)

Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.

Page 14 of 15

 

Picture 3

 

Daseke, Inc. and Subsidiaries

Reconciliation of Operating Ratio to Adjusted Operating Ratio by Segment: Specialized

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 

 

Six Months Ended June 30, 

 

(Dollars in thousands)

    

2018

    

2017

    

2018

    

2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue(1)

 

$

218,358

 

$

111,985

 

$

403,246

 

$

192,658

 

Fuel surcharge

 

 

16,605

 

 

7,936

 

 

30,757

 

 

13,864

 

Operating revenue, net of fuel surcharge

 

$

201,753

 

$

104,049

 

$

372,489

 

$

178,794

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expenses(1)

 

$

211,252

 

$

107,396

 

$

390,995

 

$

187,062

 

Fuel surcharge

 

 

16,605

 

 

7,936

 

 

30,757

 

 

13,864

 

Impairment

 

 

2,840

 

 

 —

 

 

2,840

 

 

 —

 

Net impact of step-up in basis of acquired assets

 

 

4,645

 

 

1,824

 

 

8,324

 

 

3,158

 

Adjusted operating expenses

 

$

187,162

 

$

97,636

 

$

349,074

 

$

170,040

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating ratio

 

 
96.7%

 

 
95.9%

 

 
97.0%

 

 
97.1%

 

Adjusted operating ratio

 

 
92.8%

 

 
93.8%

 

 
93.7%

 

 
95.1%

 

(1)

Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.

Page 15 of 15