Good morning, and welcome to Titanium Transportation Group's First Q uarter 2023 Earnings Conference Call. On today's call, we have Ted Daniel, President and Chief Executive Officer, Alex Fu, Chief Financial Officer, and Marilyn Daniel, Chief Operating Officer. Before we begin, I would like to remind everyone that certain statements made on this call today may be forward-looking. In that regard, please refer to the risk factors and cautionary provisions outlined in the press release issued by the company yesterday, as well as the filings made on Titanium on SEDAR. Please note that this call is being recorded today, May 16th, 2023. A replay of this call will be made available until midnight on May 30th, 2023. The details of the replay can be found on Titanium's website under the Investors section. I would now like to turn the call over to Titanium's President and CEO, Ted Daniel. Please go ahead, sir. Good morning. Thank you, operator, and thank you all for joining us. Despite challenging economic conditions, I'm pleased to share that Titanium delivered another profitable quarter, generating CAD 106 million in revenue and CAD 12.6 million in consolidated EBITDA. The market trends we saw in the latter half of 2022, including increased levels of inflation, supply chain challenges, rising interest rates, and geopolitical turmoil, continued in the first quarter of 2023. These trends also impacted the transportation industry. We observed a softening demand for freight services stemming from changes in consumer spending habits and some balancing of overstocked inventory from the prior year. At Titanium, we have always believed that during difficult times, we should be opportunistic and continue to pave the road for future growth. I believe the success we achieved in 2022 and the first quarter of 2023 is a direct result of the opportunistic investments in assets, technology, and people that we made in prior cycles. Although 2023 may not be a year of rapid growth, we believe the economic environment will present disciplined and experienced operators, such as ourselves, opportunities to make prudent investments which will translate into sustainable long-term growth for our shareholders. On a consolidated basis, we generated revenue of CAD 106 million, EBITDA of CAD 12.6 million, and EBITDA margin of 13.8%, an increase of 230 basis points from Q1 of 2022. This demonstrates our continued ability to execute on our growth strategy and commitment to improved efficiency, delivering strong and consistent margin growth. Looking at our trucking segment, we delivered revenue of CAD $51.6 million, up 4.5% year-over-year, and 52% EBITDA growth. We were able to utilize our technology-driven navigation tools to optimize our pricing strategy, which resulted in a year-over-year increase in segmented revenue. We do not expect the growth trend to continue into the remainder of the year, but anticipate continued control of our operating costs to maintain high levels of profitability in this segment. The results in the trucking segment also demonstrate the benefits of the investments we've made in our technology and our team as we continue to leverage our newest best-in-class customer and supplier digital solutions. Our newly developed supplier solution tools and vetting systems allow us to add thousands of partner carriers to our logistics database and service network. Our logistics segment, which tends to be more sensitive to market conditions, face substantial pricing pressure and demand normalization during quarter one of 2023. We generated revenue of CAD 56.2 million and EBITDA of CAD 4.6 million. While we do not expect the quality of revenue to return to the elevated levels in early 2022, we're comfortable with the margin performance that we're currently able to achieve. We continue to see significant opportunity for our growth in the U.S. marketplace. During Q1, we announced our sixth U.S. location in Fayetteville, Arkansas, as part of our goal of building Titanium's business offerings in the U.S. market. We expect to continue to secure additional U.S. locations, allowing us to grow our footprint and customer base with the addition of another two locations in 2023. Seven years ago, we outlined a bold strategy to achieve CAD 500 million in revenue. Over the past few years, we scaled our trucking and logistics business in Canada and expanded into U.S. markets, while continuing to execute on strategic acquisitions. We ended 2022 with CAD 496 million in revenue, achieving the goal we set in 2016. As we look forward, we are confident that Titanium can become a billion-dollar business. We're focused on executing on our strategy while navigating the current economic environment. Our technology-intensive platform is empowering us to deliver efficiencies in optimizing pricing, routing, and load volumes in an environment of emerging pricing pressure and softening volume demand. For the second quarter of this year, we cautiously expect a more tempered marketplace. Against this backdrop, we expect to continue to leverage technology to navigate evolving market conditions. With a strong balance sheet and cash position, we remain prepared for opportunities resulting from this economic situation. We maintain our 2023 full-year revenue guidance range of CAD 500 million-CAD 520 million, an EBITDA margin of 9.5%-11.5%. With that, I'll turn it over to Alex for a more detailed discussion of our financial results for the quarter. Alex. Thanks, Ted. No problem. In the first quarter of 2023, on a consolidated basis, Titanium generated revenue of CAD 106 million, compared to CAD 136 million in Q1 2022. We delivered EBITDA of CAD 12.6 million, compared to CAD 13.9 million in Q1 2022, with EBITDA margin of 13.8%, an increase of 230 basis points. Diving deeper into the segment performances. The truck transportation segment saw revenues of CAD 51.6 million, an increase of 4.5%, and EBITDA of CAD 8.7 million, an increase of 52.4%, with an EBITDA margin of 20.3%. The continued improvement in operating margins in the truck transportation segment is consistent with our expectations following the integration of a sizable acquisition as we continue to deliver operating improvements and synergies. The logistics segment generated revenues of CAD 56.2 million, compared to CAD 87.9 million in the comparable period. EBITDA was CAD 4.6 million, compared to CAD 9.2 million in the comparative period, with an EBITDA margin of 9.3% compared to the 11.5% in the same period. Titanium's balance sheet and solid capital position continue to provide a strong foundation for our operations and allow us to consider potential acquisition opportunities. During Q1, we bought back 72,275 common shares under our NCIB, we're actively evaluating potential acquisitions opportunities. Given the strength of our capital position and our confidence in the earnings outlook, we maintain our dividend, declaring a dividend of CAD 0.02 per common share. I would now like to turn the call back over to Ted. Thank you, Alex. To reiterate, for the remainder of 2023, it is likely that the North American economy will continue to face strong headwinds, which will undoubtedly cause turmoil within the transportation industry as well. During times like these, we are pleased to have delivered a profitable quarter. Titanium's technology-based systems and experienced team delivered quality service to our customers and executed against our financial and strategic objectives for our shareholders. Titanium is poised to not only navigate our core business through these challenges, but we expect to capitalize on potential accretive opportunities should they arise. Our investment in our proprietary technology and people allow us to approach difficult times with cautious optimism. With that, I'll turn it over to the operator to open the line for questions. Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by one on your touchtone phone. Again, that's star followed by one on your touchtone phone. If you would like to withdraw your request, please press star followed by two. Your first question comes from the line of Matthew Lee from Canaccord. Please go ahead. Hi, guys. Thanks for taking my question. I'd like to maybe start on the margin side. You know, year-over-year, you're up 690 basis points despite revenue coming down. Can you maybe help put in perspective the drivers of improved profitability between, you know, price optimization, Fusion and internal initiatives? Of course. For sure, Marilyn's gonna jump in later with some of the operation side. In terms of the margin improvement, one of the biggest factors that we have our technology allows us to navigate the current environment and really it's last year's environment to optimize our pricing strategy to our customers and to our suppliers so that we're able to realize that difference in the margins. With regards to that, Marilyn would be more in tune with the operation side. On the logistics side, basically doing more with less, I guess, is the message that we've been able to do. Part of that comes with technology we've used in vetting our carriers and getting relationships with the partner carriers that we use to ensure that our margins are where they should be. On the trucking side, obviously, we don't look at the margins as much. On the trucking side of things, we've been able to get to leverage our contractual rates with our customers to keep things as stable as possible. Yeah. Again, we keep pushing our technology, which adds to the efficiency. Obviously, our Titanium Transportation Carrier Portal is, you know, one of the, you know, sort of one of our largest innovative components of, you know, our future in terms of growing our margins on the logistics side. That's also a critical component that we keep investing in. Great. That's great color. In terms of guidance, you know, remains the same, which implies some steady ramp up for the remainder of the year, particularly for logistics. Are there any particular things you're seeing in the market currently that give you some visibility into that ramp up? Sorry, Matt, can you just clarify that again? Do you mind just re-rephrasing that, if you don't mind? You have a CAD 500 million guidance for the year. Mm-hmm. Right. You know, revenue for Q1 is obviously lower than that run rate. You know, there's a bit of a ramp up that's being required to hit that. Is there anything that you're seeing? Right. ... in the market that gives you some confidence in the visibility of the ramp? Yeah, of course. Okay, I totally get what you're saying. I mean, we'll definitely we'll split it into a couple of components. You know, currently right now you're seeing actually more net cancellations of authorities under FMCSA than you've got issuances. Obviously there's already a trend of call it tightening in the marketplace. We do expect that this year we'll have I guess call it traditional seasonality, i.e., first half is typically not as good as second half. I mean, the last few years with COVID obviously there was no such thing as seasonality. It was absolute turmoil. But we do believe that second half is gonna be better. The other thing is that, if you split our two businesses in half or, well, 60% brokerage, 40% assets, the assets tends to be more sure and steady in terms of revenue predictability. The brokerage revenue is kind of a rough number in the sense that it's more of a cost plus, right? Revenue is more of the result of the margin, if anything. It's more of a bottom-up approach. That's where, you know, I think it's a little bit of an estimation. Yeah, I think it's definitely there's, you know, some plausibility to it. Some of our confidence also has to be in the fact that we are continuing to open our logistics offices, and that will add to some of our growth that we expect in the second half, barring any potential acquisition opportunities. Just our organic growth, we expect that to continue to allow us to grow in the second half of the year. I think it's also important to note that there's some of the tightening in the carrier base, which will help margins as well. Just as a matter of fact, I think it was reported in FreightWaves or SONAR that 9,000 carriers in the U.S. exited the market between January and March of 2023. It's, there is some changes from year-over-year for sure in terms of where the marketplace is. Yeah, we continue to grow our offensive strategy in terms of growth, that will help us in the second half. All right. That's great, color. Thanks. Thanks, Matt. Thank you. Thank you. Your next question comes from the line of David Ocampo from Cormark Securities. Please go ahead. Thanks. Good morning, everyone. Good morning, David. Morning. I just wanted to follow up on Matthew's lines of questions on as it relates to margins, but maybe ask it from a different angle. If I take a look at your operating margins or your EBIT margin in logistics, that's a non-asset-based business. If I take a look at the margin, it's actually higher than your trucking business, which requires capital. If I'm looking further out, do you expect the truck transportation margins to eventually exceed logistics, especially in the context of your larger Canadian peers that are able to get, you know, a 10%+ EBIT margin? Our current model is we've provided a little bit of an insight previously into our current model. Our logistics side, we anticipate that our EBITDA will be 8%-9%. That's our target until we scale further ahead. Our trucking is anywhere from 18%-19% in EBITDA. Then like you said, we have the depreciation. We have a whole lots of after EBITDA. But that's how the business is operating because we have such a asset heavy side to the trucking side of our business. We don't expect that structure to change too much, especially not this year. Going forward into the, into the future, because we are a full truckload haul in our trucking side, we don't anticipate that structure to change until we change our product lines either. If you keep a high proportion of logistics, like the proportion of lower EBITDA obviously is gonna have an impact on percentages. I mean, as Alex said, you know, logistics is a really essentially a zero sum business. You know, being non-levered, you know, asset light, you're gonna get that kind of mix in the, you know, in the calculation, right? If we're virtually a 100% trucking, we'd be at 20% margin. You'd be, you know, obviously you'd be killing that from a cash flow perspective, you know, once you're done with sum at that point in time, right? Yeah. I guess I was talking more from the EBIT perspective, so after depreciation. Right. Just trying to understand is there a pathway for you guys to get closer to, say, TransForce's truckload division, which is, you know, 17% EBIT margin versus your, you know, 5% EBIT margin business? Yeah, I would say, you know, different product mixes. You know, we're straight up truckload. You know what? As far as I'm concerned, I think anywhere from 18%-20% is a good target for us on a pre-sum. On a, on a post-sum, I think, you know, what's gonna happen is that you're gonna see an increase in the DA over time because as trucking companies replace equipment, which is now far more expensive, depreciation's gonna go up no matter what. Right now I know that there's still fleets that are out there that are still struggling to get equipment because most of the OEMs right now are basically sold out for 2023. Yeah, that makes sense. Alex, on the net debt levels, I mean, it's gone up over the last two quarters or so. Maybe you can give an update on your maintenance CapEx on a go-forward basis and, 'cause it's been running, you know, closer to north of CAD 30 million on an annual basis. Of course. We have, if, we've kind of substantially replaced our truck fleet. We, we are kind of done with that side of the replacement cycle. Unfortunately, trailers, we're still facing supply chain issues, so we have not caught up. Quite yet with our trailer replacement. We are getting a lot more trailers this year, so fortunately we are most likely going to be caught up by the end of the year. Going forward, our maintenance CapEx we've disclosed before is about anywhere from CAD 20 million-CAD 30 million, depending on asset prices and also if we need to expand our fleet and such. Yeah. I think we also need to say that our fleet, sorry, is rather refreshed at this moment. Yeah. An average age of our tractors now below... What is it? One-point-five. One, one and a half years on our tractor. Yeah. Our trailer ratios are coming right down. I think we're at 3.5, four? Somewhere around four. Something like that. Yeah. No major... Yeah. Yeah. We're actually in really great shape in terms of, the fact that pretty much every single one of our trucks is quite new. Yeah. From that perspective, you know, we're in really good shape to continue to service the market. Yeah. Increased CapEx would be, I guess, for growth. Okay. That makes a lot of sense. My last one here is, you know, we've seen some of your Canadian counterparts get a little bit more active on M&A. What are you guys seeing out there in the marketplace? Balancing that against, you know, where your stock is trading at today, how do you, how do you compare that, like getting active on M&A versus being more active on your NCIB or even issuing a substantial share bid? Yeah. I mean, to some degree, capital allocation question, right? Are we buying or are we gonna keep hitting the max on our NCIB? Our NCIB is, I mean, we might as well get that out of the way. It's not a lot of money because our limit is quite low, quite frankly, on a daily basis. It's, it's really, you know, practically a rounding error. I mean, we might as well max out, you know. It's like maxing out your RSP. At this point in time, you know, obviously that's one little thing. In terms of sort of the M&A environment, let's just kinda hit the big one that really excites me. What's really interesting right now, David, is that I think that the mathematics is starting to really, you know, embed itself in the reality of what's happening. That's the fact that, you know, let's say everybody out there can assume a 5%, 6% cost of borrowing. I mean, you know, you go buy a house today, it's gonna cost you 5%, you know, somewhere in the range of 4%, 5%, 6%, depending. That's just your cost of capital. On top of that, I'd like to make my shareholders a little bit of profit from a cost of investing. You're really looking at at least a 10%, 11%, 12%, you know, minimum rate of return. Using now... You know, a year ago, you were into the mid-single digits. Today, you're into the low to mid-double digit requirements. That's just because the cost of capital has gone up. We know that that is going to impact multiples. There is obviously, you know, no other result that's gonna happen, but the fact that multiples are gonna have to come down as a result of the mathematics of the borrowing environment. I'm actually pretty excited about the fact that I do believe that there's going to be opportunities, and that, you know, as always, we've been looking, we continue to look, we continue to, you know, deep dive. We've been acquirers and, you know, not volume acquirers, but we're strategic acquirers. You know, we continue to execute on that, you know, on that strategy. Can you tease what kind of multiples you're seeing out there? Is it, you know, closer to where you bought ITS at 5x or multiples even below that now? Yeah. I mean, I think again, it depends on the circumstance. Yeah, generally speaking, we are back into the normal ranges of, you know, where we've traditionally seen, you know, multiples can be anywhere. It can be as low as 4%, but that's a little unusual, and it's really more dependent on the circumstance. You're kind of averaging into the, you know, into that 4%-6% range, depending. Okay. That's perfect. Thanks a lot, guys. I'll hand the call over. For sure. Thank you. Thanks, David. Thank you. Your next question comes from the line of Gianluca Tucci from Haywood. Please go ahead. Hi. Good morning, guys. Congrats- Morning, Gianluca. On margins. I'm just curious on the trucking side, like was there anything that stood out here, on the performance of the margins in your trucking division, that like, you know, that division in particular, I think impressed us all here? I think that to some degree, what we've been doing over the years is trying to diversify our customer base, have really strong navigation, and also make sure that because it is asset-based, I like to think of it as kinda like a real estate on wheels type business. You need to fill the real estate all the time. You know, we'd rather be filling it with contracted rates that's far more predictable than, you know, having, you know, basically, you know, the highs and lows of the spot market. That's more conducive to a margin-based business, obviously, which is our logistics division. That's why I think all of those different components, obviously, including everything driven by heavy investments in technology, is something that I believe drives its ability to be extremely resilient. I think that, you know, the customer base, the, you know, the contracts, the technology, et cetera, et cetera, you know, all these investments give it that tremendous amount of resilience and continuity that almost combats, you know, the ups and downs of the market, right? You don't have extremes in the way in which we run that business. In context for this quarter, yes, our margins are where we want to be. If we will look at the last three quarters in context to this quarter. Ever since we have kind of optimized our pricing strategy and put in some cost savings initiative, our margins have been pretty stable. This quarter is actually slightly lower than the last two quarter, and again, trucking is, it's really resilient, like Ted said, but it's not immune to the market conditions as well. Right. There is a little bit of retraction. Is it where we want to be? Yes, it could be better like last year, right now we're happy with it. It's not like we have done anything different. We have done the same, we've done the same thing with the same strategy in terms of cost savings, in terms of maximizing our fleet's capacity. That strategy has paid off in the last year and continues to pay off this year. We haven't really done anything special per se this quarter to achieve this margin. In fact, our margin is slightly retracted, and we would like to see it get better. Okay. On the trucking side, it's principally contracted rates, are those up for like renewal at some point this year, or does that extend into next year, the majority of the trucking business today? most trucking contracts are between one and three years. I think it's important to note that it's slightly more sticky and complex getting into accounts, as a trucking supplier. Right. We have very I mean, our customer list year-over-year, our core customer list remains the same constantly. While we work with customers with rates and adjustments as necessary, it's a very sticky component. Most of what we have does run on a calendar year, or it runs summer to summer in some cases. It. Mm-hmm. There's not a lot. I mean, if you're expecting me to say things like, the contracts are coming up in the next few months, and they're all gonna go down in pricing, that's really not the marketplace that we're in. We're still seeing some increases necessarily for costs, just not as robust as it's been in the past. Just to elaborate just a little bit more on that, when Ted mentioned technology, that we're always investing in, and it's always cumulative in terms of the effects and the returns on our segments. In the trucking sector, especially the convenience factors for drivers to keep the retention high, the convenience factor for customers to be able to be transparent with information, quick and accurate. We're able to report on all kinds of things today, even some of the more buzzword type things in terms of ESG reporting or diversity and things like that, and inclusion. We're able to report on all that. There's a lot of customers that are in that direction. Because of where our tech has taken us, we are able to provide that information, and that's creating an even stickier environment for our customers. That's good color. Thank you, Marilyn. I guess a question on the market broadly, like what are you seeing and hearing from your customers and competitors in terms of a potential like, you know, normalization of the market? Like, is that a second half story or could that push into 2024? Okay. I think that there's obviously a little bit of a, I would say an economic crystal ball on this one, but, you know, let's face it, right? When we've got more cancellations on a net basis, we know that the number of small transportation companies is shrinking, i.e., we do know according to the ATA, you've got 86% of trucking companies have 6 or less trucks. That's a huge number. If you're slowly shrinking capacity, there will be an impact at a certain stage. There will be an inflection point. I think that there was actually that kind of a discussion using that terminology in a recent article in FreightWaves, which I kind of, you know, enjoyed reading. At some point it will inflect. That's kinda why we feel that with our navigation systems, we'll be able to take advantage of that, you know, when we start to feel it, you know, we'll have the scalability. From that perspective, I think that at this point in time, though, it's definitely just assurance steady for us, and continue to just, you know, look for opportunities. Okay. A question for Alex. I think you did mention this, but can you just update us on your CapEx plans for the rest of 2023? The rest of 2000. I would say for next 12 months. We are planning to spend about CAD 30 million to refresh our fleet, and the majority of it is trailers. We are loading on trailers because we're a little behind on schedule in terms of replacement cycle. Trucks-wise, we're only really buying 25 trucks, and they're not for replacement. They're for growth. Like we said, we are anticipating second half will be stronger than first half. We're anticipating that we will need a little more capacity. It's a very moderate growth. It's not anything special. We do expect that we should be able to fill that 25 trucks with, and we will need that capacity. The trailer side is the majority, the lion's share of the replacement of CAD 30 million. That could lead all the way to Q1, 2024. That's why I say it's more of a 12-month re-replacement spend. Okay, great. Thank you, guys. Good quarter. Chat soon. Thank you. Thank you. Your next question comes from the line of Benoit Poirier from Desjardins. Please go ahead. Hey, good morning, everyone, and congratulations for the strong quarter. Good morning, Benoit. Yeah. Ted, just curious here, what makes you confident that market will rebound in the second half and be stronger than first half? Is it mostly driven by a reduction in the supply, inventory normalization? What makes you confident about the rebound in the second half? I'm just curious here. Yeah. I guess, you know, a little bit of a natural belief in Adam Smith's invisible hand here to some degree. That coupled with kinda the next ingredient being the fact that right now if you take a look at the... There is a SONAR chart that they publish on a daily basis that compares the first tender contract rates versus spot rates. The spot market right now is quite low in comparison to contract rates. In fact, it's right now hitting levels that are comparable to 2019. Yet costs now are 20%, 30% higher than 2019, and they're not going down. That is not a mathematical sustainable circumstance. In addition, I do believe that seasonality will also come into play here to some degree. As inventories get burned up, you know, you do have right now, you know, lower, import volumes, and so eventually inventories will get used up. I think all of these little ingredients are gonna give us definitely a better second half. To what degree? I mean, you know, you and I are guessing to some degree. Having said that, we do believe that, you know, certainly all of these little ingredients add up to one kind of, you know, big sort of, indicator. I think last but not least, I mean, from a Titanium perspective, we are a lot of CPG. From that perspective, we believe that people are going to continue to consume, you know, essentially essential goods. Yeah. Okay. That's great. Great color. Thank you. Looking by industry, were there big changes or industry that surprised to the upside or downside when we look at your breakdown between automotive, retail, manufactured goods, recycling and all those industry? Yeah. Well, we definitely, you know, saw a few, you know, less luxury items, but we don't really do a lot of that. We do very little of that. We are heavily vested in CPG. It's not just CPG, obviously. It's CPG subcomponents, CPG ingredients, et cetera. You know, people are still gonna be, you know, buying products that they consume on a daily basis, you know, and throughout their households. I mean, Benoit, if you look at our quarter-over-quarter industry breakdown, your top two really didn't change much. I mean, yes, they flipped, but in terms of percentages, they don't really change much. Your manufactured goods within beverages is about the same. Like Ted mentioned, there's a slight, your luxury goods have come down, but then we don't really We're agnostic to shipping luxury goods or common goods. At the end of the day, if it goes on truck, we're there to ship it. In terms of our the rest of the industry breakdown, we haven't really seen anything in there that there's going to be a shift or whatnot. It's a little different than when COVID started, where the automotive dried up, and we had to go find other business. Here, it's reduced spending across the board. I mean, there's a lot, there's a lot more spend on services. At the end of the day, when you purchase services, there is a product in the back somewhere, and we are there to ship the product. Okay. Marilyn, you gave us a great color about contractual rates for truck transportation, but I was wondering whether there was any change in the mix between spot and contractual rate for logistic. I know you have some exposure to contractual and logistic. It used to be about 50%. I was just wondering whether the mix has changed a bit for logistic. We're still largely that 50/50 in terms of contract and spot through spot. The spot market board has come down for sure, less making it to the spot market because there's overcapacity at the truck level, we'll say. The spot market volume has come down significantly, I think, over the last couple of quarters really. I do see that. It's interesting when we look to the U.S. for a telltale, it seems the U.S. spot market now is getting a little bit better, whereas the Canadian market seems to have gotten a little bit worse in the last little bit. We always kind of lag. That's why I also look at that as an indicator for our second half of the year, as we expect it to be just a little bit better as we're looking to our U.S. partners, as a telltale. That's interesting. Okay. Great color. Just with respect to the fuel, when we look at the diesel, it really increased in the Q2 last year. While if you look right now, the diesel price is coming down, it seems that there will be a big difference in terms of market sentiment, in terms of fuel surcharge going into the second quarter. How should we be thinking about the lag, the fuel surcharge and maybe the impact on margin wise? Fuel, the major fuel decrease really come in the earlier the year. Your lag isn't really there between FSC and fuel costs anymore. Fuel cost is depressed from the 2022 level. It's higher than your 2019 level, it's lower than your 2022 level for sure. Most market sentiment is that fuel is supposed to be higher on average in 2023 compared to 2022. We don't know, we don't know where it's gonna go. It's always a wild card in when it comes to the fuel pricing. If we go off on those reports, we are expecting fuel costs to jump up for the remaining of the year, at some point or gradually. At the end of the day, it is a pass-through for us. In terms of how our margins will be impacted, probably not a whole lot of impact. The top line will be impacted, however. If fuel does increase to where the reports are saying, we're most likely going to see that our trucking is going to increase in revenue, but our profitability will remain about the same. Okay. That's great color, Alex. Just last question on M&A. You removed some commentary surrounding M&A in your press release versus last quarter. How should we read into this at all? Has anything changed from a M&A standpoint? No, actually. I guess that wasn't necessarily a read between the lines. It's just that we were, I think, efficient in our initial scripted portion of the of the call. Absolutely not. We are very much so an acquirer, and that hasn't changed. We like being an acquirer. We believe that, you know, we can continue to acquire opportunistically, you know, a good fit, a good, you know, win-win for both vendor and purchaser. You know, we're actually really excited for, you know, our future opportunities. Okay, perfect. Great. Thanks for the time and some breath again. Thank you. Yeah, for sure. Thank you, Benoit. Thank you. Your last question comes from the line of Brian Pow from Raymond James. Please go ahead. Yeah. Good morning, everyone. Good morning, Brian. Good morning, Brian. Yeah, just in light of the tough freight environment, and specifically on your expansion plans on the logistics side, does this change maybe the cadence of your plans to expand at all or maybe even accelerate that expansion to get ahead of an eventual recovery? I guess, are you asking if we're slowing down, so to speak? Correct ... in terms of our expansion plans? Yeah, maybe that. Yeah. Okay. I mean, I'm gonna split into our two major segments. From a trucking perspective, as I like to think of it is a bit of a real estate on wheels. You know, when you've got too much capacity, you don't go build, you know, more buildings. In terms of expanding trucking, organically, I definitely don't think that, you know, we're gonna be doing a lot of that. Maybe a tiny little bit, as Alex said. You know, we've got the ability to buy another 20-25 trucks, you know, later on this year. You know, we can easily say, you know, pivot, for lack of a better term, on that level if we just don't see the need. In terms... We'll run that solid, steady, you know, with great customer relations and contract rates. We'll keep that real estate full. In terms of the logistics side, I believe that to some degree, logistics, in fact, you don't actually grow logistics in times where it's already tight capacity and, in a way it's almost like it's too late. Like, that train's already running at 1 million miles an hour, so you're not getting on. This is a really great time for us to actually apply the offense is your best defense strategy. We definitely are very excited about the opportunity to be able to continue to invest in tech and people and keep growing our logistics business aggressively. Great. That's good color. Yeah. Just another question on M&A. I mean, how would you categorize the M&A pipeline? I mean, you talked about valuations, maybe right-sizing here, but have you seen the number of opportunities accelerate? I have. I've definitely seen an acceleration. I, I mean, I don't know if it's... Like, we're calling it right sizing, but when the cost of borrowing was 1% or 2%, multiples were reflective to some degree of that, of that, call it denominator. I'm gonna say that right sizing, I think, I think we can all agree that those were emergency rates and the multiples that were a factor of those kind of that low, you know, borrowing cost, were unsustainable. In terms of right sizing, I believe that the multiples now are just simply reflecting a more realistic long-term cost of borrowing. I think that from that perspective, there's definitely gonna be a lot of opportunity. We like to buy, however, a good fit, one that fits our geography, our product lines, you know, our culture, et cetera. We also look for, you know, also good, call it, you know, like good fits from a cultural perspective as well, where, you know, both, the vendor and ourselves are able to mutually benefit from that. Kind of a little bit of a, you know, two olus two will be five, not just four. We always look for that. Great. Thanks. I appreciate the color. That's it for me. I'll turn it over. Mm-hmm. Thanks, Brian. Thank you. There are no further questions at this time. I'd now like to turn the call back over to Mr. Ted Daniel for any closing remarks. All right. Thank you, operator, for facilitating the call. Regardless of the economic conditions we operate in, undoubtedly with our innovative, hardworking team of people, Titanium will continue to grow, succeed, and increase shareholder value. We highly appreciate your interest in Titanium. If there are any further questions, please feel free to contact us. Thank you everyone for joining this morning's call. Thank you, sir. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect the lines. Have a lovely day.