Good morning. My name is Devin. I will be your conference operator today. At this time, I would like to welcome everyone to the Saia Inc. fourth quarter and annual meeting conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you have a question during this time, simply press star followed by the one on your telephone keypad. If you would like to withdraw your question at any time, please press the pound key. Thank you for your patience. I will now turn the call over to Doug Cole, Saia's Executive Vice President and Chief Financial Officer. Please go ahead. Thanks. Thanks, Devin. This is Doug Cole. I'm Saia's Executive Vice President and Chief Financial Officer. With me for today's call is Fritz Holzgrefe, our President and Chief Executive Officer. Before we begin, you should know that during the call we may make some forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements and all other statements that might be made on this call that are not historical facts are subject to a number of risks and uncertainties, and our actual results may differ materially. We refer you to our press release and our SEC filings for more information on these exact risk factors that could cause actual results to differ. I will now turn the call over to Fritz for some opening comments. Good morning, thank you for joining us to discuss Saia's fourth quarter and record full-year results. Before I get into the discussion of fourth quarter results, I want to take a minute and express my thanks to the entire team here at Saia for what we achieved together in 2022. The year brought an additional 11 new terminals into our network, and our team grew by more than 500 employees during the year. Most importantly, we kept the customer first and continued to provide leading service to our customers, in doing so, achieved record sales and earnings for the full year. Thanks to all of our Saia associates who had a hand in these record results. Moving on to our recent results, December brought a continuation of the negative volume trends we experienced across the back half of 2022. In the fourth quarter, we averaged approximately 28,400 shipments per day, about 8.2% fewer shipments per day than in the same quarter last year and down from 30,500 shipments per day averaged in the third quarter. Weight per shipment increased modestly, so overall tonnage was down 7.7%. The slowing industrial environment, as evidenced by numerous reports, influenced these results across all of our business. On a brighter note, though, pricing remained stable and our fourth quarter yield, excluding fuel surcharge, grew by 6.5%, and revenue per shipment, excluding fuel surcharge, increased by 7.1%. Total fourth quarter revenue rose by 6.3% to $655 million. Our continued strong service performance supported a contractual renewal increase of 7.4% in the fourth quarter. The contractual renewals reflect a deceleration from the trend of the past several quarters and should be expected given the softer volume environment, but a solid number nonetheless. On a full year basis in 2022, total revenue of $2.8 billion was a record for Saia. It was up 22% from the prior year. Operating income rose 40% for the year to $470.5 million, and our operating ratio of 83.1% was 230 basis points improved from 2021. This was the best year in our nearly 100-year operating history. As we move into 2023, we've continued to see announced general rate increases across the market, that are in the mid-single digit range. Here at Saia, we implemented a general rate increase this past Monday, which averages approximately 6.5% across impacted customers. At the same time, our service indicators remained very strong across the business. We're committed to providing excellent service to our customers and are invested heavily in the business to expand coverage, and it's gratifying to see that our customers see the value in our service offering. A GRI allows us to partially offset the rising cost of investing in people, equipment, technology, and our growing service footprint. Our fourth quarter operating ratio of 85.9% increased by 170 basis points compared to our operating ratio of 84.2% posted in the fourth quarter last year. I'll now turn the call over to Doug for more details from our fourth quarter and full year financial results. Thanks, Fritz. As mentioned, fourth quarter revenue increased by $38.6 million- $655.7 million. The components of revenue growth in the quarter versus the fourth quarter a year ago were as follows. Our yield, excluding fuel surcharge, improved by 6.5%, and yield increased by 14.3% including the fuel surcharge. Fuel surcharge revenue increased by 46.4% and was 20.1% of total revenue compared to 14.6% in last year's fourth quarter. Revenue per shipment excluding fuel surcharge rose 7.1% to $288.34, and including fuel surcharge, revenue per shipment rose 15% to $364.44. Tonnage decreased 7.7% attributable to an 8.2% shipment decline, slightly offset by a 0.5% increase in our average weight per shipment. Our length of haul decreased 3.5% to 892 mi. A further breakdown of activity in the quarter is as follows. In October, our shipments were down 4.4% and tonnage was down 3% with a 1.4% increase in weight per shipment. In November, shipments were down 8.1%, tonnage was down 7.1%, and weight per shipment rose 1.1%. December shipments were down 12.3% and tonnage was down 13.2% with weight per shipment turning negative, down 1% in December. In January, shipments have been down, were down 3.9% that, and tonnage was down 3.7% with weight per shipment up slightly at 0.2%. Shifting to the expense side for a few key items to note in the quarter and how they moved with the acceleration of negative volume trends we experienced. Salaries, wages, and benefits increased by 5.3% from a combination of our July wage increase, which averaged about approximately 4.3% across our employee base, and also the result of our employee count having grown by approximately 5.7% year-over-year. Purchase transportation expense decreased by 13.8% compared to last year and was 9.2% of total revenue compared to 11.3% in the fourth quarter of 2021. Truck and rail purchase transportation miles combined were 12% of our total line haul miles in the quarter, compared to 19.5% in the fourth quarter of 2021. Compared sequentially to Q3, miles of 17%. Fuel expense increased by 41.5% in the quarter, while company miles increased 4.3% year-over-year. The increase in fuel expense was primarily the result of national average diesel prices rising by more than 38% on a year-over-year basis. Claims and insurance expense decreased by 8% year-over-year in the quarter and was down 2% or $0.3 million sequentially from the third quarter. Depreciation expense of $39.6 million in the quarter was 10.3% higher year-over-year, primarily related to investments in real estate and equipment. Total operating expenses increased by 8.3% in the quarter, and with a year-over-year revenue increase of 6.3%, our operating ratio increased by 170 basis points to 85.9%, compared to 84.2% a year ago. Our fourth quarter tax rate of 24% compared to 23.9% in the fourth quarter last year, and our diluted earnings per share were $2.65 compared to $2.76 in the fourth quarter a year ago. Moving on to the financial highlights of our full year 2022 results. As Fritz mentioned, revenue was a record $2.8 billion, and operating income of $470.5 million was also an annual record. Our operating ratio improved 230 basis points in the year to a record 83.1%. For the full year of 2022, our diluted earnings per share were a record $13.40 compared to $9.48 in 2021. I'll now turn the call back over to Fritz for some closing comments. Thanks, Doug. While the environment certainly feels a bit more tempered to us than it did entering the past couple of years, I feel pretty optimistic about the road ahead. The December volume decline was a bit more pronounced than what we would have expected from a seasonality standpoint. We do feel like some of that may have been the result of inclement weather that moved across the country over the last week or so of December. The extreme temperatures have resulted in some customers working limited schedules. We saw that in reduced pickups. As we turn the calendar to January, volumes are catching up a bit better than expected, maybe the result of some catch-up from customers. If history holds, there'll be more weather effects as we move through the next month and get into warmer temperatures in our seasonally busier months of the year. However, as we've learned over the past several years, as the environment is disrupted by weather or other events, the carrier that has the ability to adjust and restore service will continue to be a strategic partner of the customer's supply chain. In terms of expectations, we have plans to open five terminals over the next three to four months and look forward to the expanded service and presence these terminals will give us. At the same time, we continue to develop the markets around the 18 facilities that we have opened over the last two years. Although we're excited by the early success of these locations, we see considerable runway to continue and penetrate those markets. Beyond that, we continue to work through a pipeline of more than 30 real estate projects, which are under review and consideration as potential openings over the next several years. These terminal openings support our strategy of getting closer to the customer and adding value to the supply chain. With that said, we're ready to open the line to questions, operator. At this time, I would like to remind everyone in order to ask a question, please press star and then the number one on your telephone keypad. Our first question comes from Todd Fowler with KeyBanc Capital Markets. Hey. Great. Good morning, Fritz. Good morning, Doug. Thanks for taking the question. Fritz, it sounds like you just covered a little bit of, like, the January trends, and it feels like maybe that there's some movement between late December and into January. I guess I'm just curious in this environment how you think about, you know, managing the staffing levels with kind of the volatility in freight as you think about, you know, margin progression either into the first quarter or even on a full year basis in 2023. You know, what would your expectations be, just given kind of where the environment is? I think the key thing for us, Todd, you know, we described the impacts that we saw with weather in December and, you know, just the last few days of January, you actually saw the weather trends in the center of the country. As you would expect, that influenced the results we have. The key thing that we think about with any of this is that we want to manage our labor costs to match, you know, sort of what we need to do to deliver leading or exceeding service for our customers. As we've gone through this last few months, as we've seen the trends, we've reset kind of our cost model. You see us insourcing more and more of our line haul costs versus what we had been doing, looking for opportunities to leverage our city drivers into our line haul network to maximize the utilization of all those important assets. Those people are key to driving the success for us. As we come out of weather events or slower economic events to be able to match, customers' needs and expectations or frankly exceed them. We feel like that that we're continuing to position ourselves for that. We've looked at, you know, the history of what we've seen sort of quarter-to-quarter, you know, from Q4 to Q1. You know, we feel like we can keep that kind of in line with historic sort of seasonality there, keep the OR flat. Maybe it gets better if things get a little bit better. I think we continue to manage to maintain service, and then we optimize and match our labor costs to what, you know, what the environment affords us. You know, full year, it's still... It'll be interesting to see how this develops, you know, as to where this ends up. I think that, you know, we're in a position that we know that we're providing differentiated service. That's gonna allow us, and the environment certainly is gonna continue to allow us to price for that. I think that's gonna be an important part of how we, you know, manage the overall investment in the business. Yeah. Okay. Thanks, Fritz. Maybe just to that last point, I'll turn it over after this. You know, on the pricing side, and you talked about the contract renewals coming in, I think at, you know, 7.4%, and that's down from what we've seen over the last couple of quarters, which have been very strong. You know, can you just speak to, you know, where you think you're at with your pricing ability based on, you know, your service improvements and the network and maybe your ability to kind of continue to close that pricing gap as you've made those investments and improved the service over the last several years? Thanks a lot. Thanks, Todd. I mean, frankly, I mean, is to emphasize our focus is on keeping that customer front and center. I think in that kind of environment, you know, you've got. This continues to be an expensive business to operate. You've got to continue to push, making sure that we get paid for all the service that we provide. You know, I think maybe the rates of change that we've seen over the last few years, it slows perhaps. I, you know, I think the position that we're in right now around what we're doing for the customer, that is differentiated. If I look across the landscape of what, you know, what others are. Service is being provided, what that pricing looks like. I mean, I think that there's an opportunity for us to continue to grow our business and develop the margin profile that this business deserves. Sounds good. Thanks for all the help. Our next question comes from Scott Group with Wolfe Research. Hey, thanks. Morning, guys. A few things. Can you just on the January trends, do you have a sense on the sequential December to January and how that was trending? Yeah. Historically, we've seen, you know, a little bit of step up, call it 1.5%-2% historically as you move into January. That's always influenced by, you know, the weather you're exiting and what you're facing. The step up was, you know, closer to 5.5%-6% this year. Like Fritz said, you know, that last week of December, man, it was tough with that cold front that went across the country, the pickups were really soft. Some of that could have been just catch up, like Fritz said, from customers. You know, it felt better given. First two weeks of January felt a lot better than the last two weeks of December, for sure. Okay, good. Then, Doug, any help with how to think, I know you don't give us inter-quarter yield updates, but just directionally, how to think about the yield trends, you know, gross to fuel, net to fuel, however you want to think about it in Q1, the year, however you're thinking about. Yeah. I mean, you know, like Fritz said, I mean, we've seen a lot of GRI announcements, and our GRI went out this past Monday. It's, like I said, at an average of 6.5%. You know, in a softer volume environment, you know, you probably end up, you know, making some concessions in some lanes, for example, or with some really good operating customers. You know, historically, we say we hold on to about 80% of our GRI in terms of the yield that we capture. You know, in a softer volume environment, maybe it's a little less than that. I saw a couple GRIs. I think on average, the GRIs, even though they're solidly, you know, mid-single digits, I... You know, there's a couple that are lower than what we've seen over the last couple of years. I think that's just in line with probably what the shippers expectations are. You know, it's still a positive environment. I mean, the 7.4% contractual yield, I mean, as you know, I mean, it's just kind of a forward-looking indicator to us of what the shipper is expecting, and it's coming off the heels of several quarters of double-digit, you know, rate increases, so we're lapping some of that. I'd say pricing, you know, in January was still positive. I just think the expectation should be that you won't get price at the same rate when volumes are running down like they're running. Right. Just last thing, obviously, based on sequential margin being flat, right? Margin's down, you know, 1.5 percentage points year-over-year. Do you think you have the potential to improve margin over the course of the full year? You know, we go back and look at some examples. I mean, I, you know, I guess it from a very high level, it's gonna depend on really where this economy goes and what volumes look like. I mean, we've got examples in the past, you know, improving margins in a down year. I mean, if we go back to, you know, a couple of years like 2014 into 2015, you know, things were down in 2015, kinda energy rolled over. Our shipments and revenue were both down about 4% that year. You know, fuel expense was down a lot, fuel, you know, fuel surcharge revenue would have been down. That year was the year we actually improved our margins by 70 basis points. You know, we look at the following year, it was still pretty sluggish environment. Fuel was down again. I think our revenue was flattish on down tonnage. That year, you know, the OR went backwards a little bit. There's a lot of moving pieces out there, but I think, you know, if shipments are gonna be down like they are kind of in January, if we had to run that through the full year, you know, we really got to hang on to this, you know, rate increases at this GRI level. Then I think we could hold on to margins. I think if volumes are gonna run negative all year in this low to mid-single digit range, I think it would be hard to improve margins. Again, you know, like Fritz mentioned in his opening comments, we've got 18 terminals open in the past couple of years. I mean, although, you know, we're pleased with how they're doing, and as they mature, they do better every quarter. Those were a drag, you know, essentially on the overall OR we reported. Again, while you're building out a network like this, which is something we're gonna have to manage through, I think it'd be reasonable to think OR is within ±100 basis points of what we just exited would be reasonable. Thank you, guys. Appreciate the time. Our next question comes from Christian Wetherbee with Citigroup. Hey. Thanks. Good morning. Yeah, maybe picking up on the cost side. Wanting to get a sense of what you think your cost inflation is running, and then maybe a little bit about how you think you're gonna manage headcount, assuming that we still see a little bit of sluggishness in tonnage, at least for the first part of the year. Well, yeah, I think Fritz covered it pretty well. I mean, I can give you an idea of how we manage it. I mean, if I think of just sequentially Q3 into Q4, our shipments per day were down almost 7%, right? It was accelerating there at the end as I stepped through the months. Shipments per day down about 7%. You know, you go to work on the things you can control out in the network. Our dock hours per day, for example, Q3 into Q4 were down 10%. You know, our city hours, Q3 into Q4, as we're managing down cost to adjust to these declining volumes, our city hours per day, were down about 5% Q3 to Q4. Those are the levers we'll keep to work on. Like Fritz said, I think we've... you know, we're in a position, given where we exited December, that, you know, our capacity in terms of labor and all feels pretty good for where we sit today. We brought a lot of it that we could in-house to make sure we keep our, you know, drivers, you know, as busy as we can and keep that valuable resource because our outlook is still, you know, a little bit cloudy. I mean, there's people starting to talk themselves into the idea that we're definitely gonna have a soft landing now. We want to be mindful that it's very fluid, and we don't want to be scrambling to find these valuable, you know, employee resources when our customers need us. It's a tightrope, but we feel pretty good about how we've positioned ourselves thus far. And cost inflation, as you think about the beginning of 2023, is it mid-single digits or so? I mean, it's hard to give you just kind of an average number, right? If I think about it on the wage side, you're still gonna have some wage inflation there. This past year, our average wage increase was about 4.3%. I think something in that range still kind of makes sense unless things really fall apart in the jobs economy. You know, you move down the line, I mean, depreciation was up 10% in 2022, and it's gonna be up again. I mean, we're gonna invest in the business again this year. Like Fritz said, we've got terminals to open. We're gonna invest in the fleet, work on, you know, fleet age, which helps our maintenance costs. Those are a couple of big buckets. When you get below that, I mean, it's tough to say because, you know, PT can be down a lot. That's a cost bucket, but it's down because we're moving some of those costs to other buckets. I think low to mid-single digit, maybe if I had to think about an average- Okay. All right. ... cost inflation. That's helpful. Appreciate it, guys. Thank you. Our next question comes from Jonathan Chappell with Evercore ISI. Thank you. Good morning. Doug, you just touched on PT. I wanted to ask you about that. I mean, it's been running, you know, much higher than historical levels up until this fourth quarter, and you pulled it down pretty meaningfully as a percentage of revenue. How much of that is... I mean, obviously, there's a shipment component to it, but do you view that as kind of structural? Sounds like you're gonna run, you know, headcount, thoughtfully throughout a cycle. PT seems to be a quicker lever. Is this step down, you know, kind of more consistent of the levels we should think about in this type of volume environment you laid out for 2023? I mean, given the expansion efforts we have underway to grow the network, you know, to be more comparable to the network of some of our national peers, you know, we're gonna continue to need, you know, PT as we come out of whatever slowdown we're in here. We're gonna continue to need PT. We use it, you know, very effectively. If I think back to pre-2017, before we were in this expansion mode, as a percentage of miles, I mean, we run in that 12%-14% range, you know, pretty regularly. You know, if we take it below that in this downtime, it's because we want to use our drivers and hang on to them. I don't think that structurally... I mean, we've ripped a lot of it out. When business comes back, we're gonna need it. We're gonna use it effectively. I don't think this is kind of a run rate from here. If the economy bounces back, we'll use it. We'll use more rail, right? I mean, if we can get it, we'll use over-the-road truck PT because those rates are probably gonna be pretty favorable when things come back because they're kind of resetting now. You know, we brought miles down quite a bit. You know, sometimes when we do it's, you know, we're doing it to preserve, you know, hours and miles for our drivers, but it's not all that effective in some lanes. If I was running PT into a, into a, backhaul market. I'm running those miles with my own driver now and coming back less efficient because maybe I'm not full. I'm doing that because, you know, I want to keep those drivers, keep them busy where I can. You know, if you follow us for a while, PT is not a negative for us. It's just variable, and we like to use it when it's effective for us. Yeah. It's part of our total line haul cost investment. You know, at any given point in time, we're going to make a decision around what's cost optimal around the options that we have available, be it rail, truck, or internal fleet. It's, you know, it will flex and change over time as we meet service obligations. The first step we have in that process is that whatever choice we may make has to be about supporting what the customer requires, and then we cost optimize from there. It's good to have that flexibility in this volatile time. Fritz, big picture one for you quickly. It feels like the consumer narrative is pretty binary right now, but maybe getting a bit more optimistic. The industrial narrative seems a lot more negative, and you carry more industrial freight. You know, the last couple of months of data you've provided notwithstanding, what are you thinking or what are your customers saying about the industrial outlook for this year? You know, I think, we read much the same thing that you do, and I think I would say generally across the board, it's tempered. I think it's critical for us to remain, keep that flexibility, and keep the our network in a position that we can flex as we need to. You know, if the consumer is a bit stronger, certainly we have some elements of our business that would be more consumer-tied or others that may be more industrial-tied. We want to be able to handle both or be able to deal both and be in a position that we can flex, but most significantly meet those service requirements. That's why we've managed the way we have. We really focused our cost optimization efforts around reducing hours and maintaining flexibility and availability in our workforce. So far, that's been successful. And I think we've got to continue to focus on, you know, matching those service expectations and balancing that against, you know, maximizing or best utilizing our driver fleet. Thanks a lot, Fritz. Thanks, Doug. Our next question comes from Amit Mehrotra with Deutsche Bank. Thanks, operator. Hi, Fritz. Hi, Doug. Good morning. I just wanted to follow up on the, on the margin expectation for the first quarter. I guess, just given how, you know, weak November was or counterseasonal November was and, you know, the relative snap back in January, I would just think there may be an opportunity to see some counterseasonal OR improvement. I don't know if you vehemently disagree with that or if there's something in the cost structure that evolved that I'm missing, but it just seems like 4 Q was just a lot worse because of the November fall off, and that's counterseasonal, and maybe you get some of that back in the first quarter. You know, Amit, we could also paint a picture that we could go the other way. I think the challenge you have with forecasting or really considering sort of March or sorry, March quarter, first quarter result is that, you know, January and February, historically, you go back in time for us, have been, you know, up and down. It could be everything from economic to, you know, weather related, all those sorts of things. It's tough to draw a correlation, you know, to say that, hey, this could bounce back. We know that March is the most important month of the quarter. What I like the position that we're in right now, because we've worked extensively, you know, November, December into the present time and resetting our profile to be able to be in a position that we're a little bit more cost optimal as compared to what we saw as tonnage declined in November and December. We feel a little bit better that where our footing is now, what our productivity looks like, and most significantly, what our service level is and our ability to restore service as we move through even the last week of, you know, weather challenges we've had. That's part of the game right now. I think the path to outperforming Q1 is we get a favorable operating environment in terms of everything from weather and such, and I think, you know, we can perform well through here. You know, we've given our thoughts around the margin profile. As we look at history, that feels like where we would be. Certainly is there path to better? Sure. Okay. Yeah, that's helpful. Maybe one more, maybe more important question, than, like, the near-term stuff. I'm just curious, how much of the, you know, productive labor force did you guys lose through attrition as you guys cut the hours across the board? Really what I'm trying to get a sense of, the next most important thing is how carriers are able to bounce back, efficiently and with fluidity, as volumes come back in late February or March, hopefully. I just want to know, are you properly resourced with respect to dock workers and drivers, to meet that opportunity, just given the big cut to hours and maybe the attrition that drove? Yeah. The attrition has been, we've seen a bit of it here in the last, you know, few weeks, months, and it's been relatively small. We have focused very diligently as we've reduced hours. It's important to us that we balance that across our workforce. As we've seen some, you know, some attrition, we haven't replaced heads, so that allows you to better balance across the remaining headcount. We feel like we're pretty well positioned that we can flex from here, flex up from here. You know, some of the things that we have done around workforce, you know, as we've had part-time dock staff have, you know, elected to move on to other things. You know, we've used our supervisor ranks to work on the dock, and in some cases, we've used some of our city drivers. All those are ways for us to keep that all-important connection with those critical employees so that when time comes, and I think it'll come, that we can flex out of this, I think we'll be in a good position to restore and continue to grow. Yeah. Okay. Thank you. Nice job to you and the team. Appreciate it. Our next question comes from Jack Atkins with Stephens. Okay, great. Good morning, and thanks for taking my questions. I guess, you know, Doug, if we can go back to something you mentioned earlier, sort of we're talking ourselves into this idea of a soft landing. You know, I don't know if that's right or not, but I would just sort of be curious if you and Fritz could maybe comment a bit on what your customers are telling you about, maybe how they're expecting their business trends to kind of progress through the year. Just any sort of color or context around that. Well, I mean, it's hard for us to pull in an anecdote or here or there and try to draw a conclusion. I mean, we've got a very diverse customer mix. You know, we've got 60%-65% industrial exposure, but not any one customer makes up more than 3.5% of our revenue. I'd hate to take one anecdote and try to draw a conclusion from that. Sure. I mean, we can look at the same data you all are looking at, and ISM wasn't all that high. You know, it wasn't all that favorable in January. You know, just thinking about, you know, what's going on in the jobs market and with some of the other economic data, you know, it doesn't seem as bearish as it was late last year in terms of the outlook. You know, for us, I think like Fritz has keyed on, I mean, you know, I think we've gotten a pretty good position from a cost standpoint with the volumes we're currently seeing. You know, we've got the rate increase we've worked on and announced the GRI, and that's key to what we're doing because I think our service does, you know, put us in a position to go get pricing. You know, whatever goes on from here, I think our we've got a pretty good relative value proposition. If things are gonna be down, maybe we'll find share opportunity. Maybe ours will be down a little bit less because we're in some newer markets. We've got good service. If our rate's attractive, even if we're all bumping rates up a little bit, maybe we offset it, and we're down a little bit less. Yeah, I don't think we've got a great view into what a general customer outlook is. Okay. Okay. We look at some of the shipper surveys that come out of you all, so, you know, the annual ranks, so. Okay. All right. Well, know that I appreciate that. I appreciate just the intellectual honesty about that, and it's all good. I guess maybe for my second question, I just would be curious, you know, but just following up on Amit's question earlier, which a fair point. You know, how are you guys thinking about, you know, latent capacity in the network today? You know, if I recall, last time you updated us, it was about 20% or so. I know it's a hard number to really get to, but we've also seen tonnage come down a bit. You know, it definitely feels like you're carrying extra costs for when things begin to recover, to be prepared for that. How are you thinking about where that number stands today, roughly? Yeah. Jack, we're at least. We've got, I think I'd expand that to, you know, 25 capacity, 25% kinda latent capacity. I think the one call-out that I'd point to, you know, we've mentioned that we've opened 18 facilities in the last two years. You know, our focus there is, you know, we're thrilled with the early success we've had there, but when you're making a 10-year investment, you know, when we move or identify these facilities, we're thinking about them for 10 years. Those are all opportunities for us, and we've got our sales force geared on that as an opportunity because that's capacity we can fill. You know, I think in some of the... We have a couple of pinch point investments in the network this year where we're, you know, adding some brake capacity. You know, we still have some of the challenges we had before in terms of, you know, we have a range. We've got facilities that have got tons of capacity and others that, you know, we've still got to make some investments. What I really like about it is that as we look across our, you know, this network and footprint, we've got a pretty consistent service offering across the board. For us to match a customer need and grow is really exciting to us. I think, you know, that flexibility and the ability to repeat the service is gonna be key. Okay, Fritz. Thanks again for the time. Really appreciate it. Our next question comes from Jordan Alliger with Goldman Sachs. Yeah. I just I guess following on some color around the newer terminals that Doug had mentioned, et cetera, you know, as being a slight drag. I'm just sort of curious, the last 12 or 18 that you opened, when you do open them, is the gap between existing and new narrowed versus prior experience? You know, do you get up to profitability in a quicker fashion? Just sort of curious. Thanks. Absolutely. You get back to quicker to sort of company average OR for sure. When we opened the Northeast, you know, it took a little bit of time. Now we're thrilled with where it is right now, you know, it took some time to scale those just simply because we had to build the infrastructure around that. The last 18 are more, I'd characterize as sort of fill in. These are ones that, you know, maybe you've taken a little bit of stem time out, so you've got a cost advantage you're taking advantage of, or frankly, you're finding a new customer or better serving the customer. These I would expect we would be able to get some company averages much more quickly. I will point out that the challenge with that is that when you experience what we did in the fourth quarter about the volume trends that Doug described, that impacts a facility that's, you know, it's in its infancy. You know, they become a bit of a drag in that because you experience that across the board, those sorts of trends. Great. Thank you. Our next question comes from Tom Wadewitz with UBS. Good morning. I wanted to see if you could, I think offer some thoughts on pricing. I mean, it seems like, you know, there was debate over the last year about, you know, is LTL pricing going to hold or not. You know, I think generally people are of the mindset it will. I think the results are pretty consistent with that. You know, are you seeing anything in competitor behavior that causes you to be kind of more or less optimistic? I mean, I guess the idea that you said of getting less price in a weaker tonnage environment totally makes sense. Anything on kind of competitive dynamic and conviction on the favorable, you know, pricing dynamic for LTL? Yeah, I don't see any changes there. I mean, certainly the customer and the environment is, Tom, as you just characterized, a bit softer, right? That it's not what we saw a few months ago or, you know, a year ago. What I tell you, I look at specifically at Saia, and I look at kind of where we stack up against the competition, and I look at the service that we're providing, which is in many cases better. I think there's a, there's an opportunity there for us. You know, the investments that we made, the facilities and expansion, it deserves that. I feel pretty good about our position. The rate of growth may not be the same, the opportunity remains. I think the environment underlying everybody still has inflationary costs. I think that's a critical part of the industry and kind of what we see. Right. Okay. It sounds like still a lot of confidence in the competitive dynamic. I guess for the second question, I think you talked a little bit about industrial earlier. Maybe parse it a little bit further. Did you see a difference, you know, have you seen a difference over the last several months in terms of how much weakness is being realized with industrial customers versus retail customers? I think the idea is just that, you know, if you have inventory reduction with retail customers, maybe that plays out through 1Q when they improve, but it's just a little less clear on whether you've already seen, you know, weakness with industrial customers or whether that's still to come? You know, I think, Tom, one of the things we're challenged with is that no one customer is greater than 4% of our revenue base. It automatically is a pretty diverse base. I would tell you what we've seen, the trends that we've seen, you know, it's been pretty much across the board. I don't have a really good call out around, you know, industrial or retail there. Particularly, you know, in some cases, as you know, in this business, you know, as a customer's mix of business changes or their plans change, you know, they may, you know, choose alternate supply chains and things, and we may lose or pick up business. It's tough to really for us to call a trend there. I would say that the trends that we've seen in our business have been really pretty much across the board. I don't have any really good intel for you on the retail side or the industrial component. It sounds like you... I guess there's some information value, I think, in saying that you haven't seen a big difference between the two, right? Like- Yeah. You don't- That's fair. I would caution you by saying sometimes some of what we've seen is based on our own action because we're pretty deliberate around making sure we get the pricing piece right because our service levels are pretty critical. Right. Okay. Makes sense. Thank you for the time. Yep. Our next question comes from Ken Hoexter with Bank of America. Hey, great. Good morning, thanks for the time, Fritz and Doug. You know, going back to the real estate last quarter, Doug, I think you mentioned that you could slow things based on the flows, but given your opening 5 terminals, you know, how do you is that in line with your target of 10-15 this year and kind of your annual growth? Are you thinking about things slowing based on tonnage? I guess maybe just how do you think about that given your real estate projects? Ken, the way I let me just jump in on that one. The five that we're opening, those are in our pipeline, and I tell you they're confirmed. You know, as we look out for the balance of the year, we're going to be opportunistic. We may add additional facilities down the road based on what we see in the macro environment. One of the great things about doing an organic expansion is you can accelerate or slow down as you need to. I think right now with kind of the tempered environment that we're in, we feel pretty good about these next five. There may be a few after that, but I'm not in a position I can speak to those yet. We know what they will be, but we may not, you know, open them this year. We could open them this year. It all depends on what the environment is. I think the opportunity that we have right now is the last 18 that we've opened. Let's continue to optimize those and add share in those markets. Then we'll take advantage of these. We've got a couple of big ones coming up this quarter and next, which I think will be a nice add for us. Fritz, it's not like you're saying, "Hey, we're opening five because we're seeing some opportunities." It's these were already in progress, and now we'll decelerate from here on and maybe calm into the second half unless we see things improve. Is that a better way to look at it? Yeah, exactly. You know what? If we feel better about the second half or more confident, I should say, you know, we could add more. You know? Yeah. We could come back and say, "Hey, Ken, we're gonna add, you know, five, six more." We could do that, but right now, we like the next five, and we like the fact that we've got a lot of opportunity in the last 18. I know you don't give out the fuel expense specifically, and one of the things that I think a lot of investors had been worried about was the amount of profits that were coming off of fuel surcharges, and it seems pretty thin this quarter, you know, with your fuel surcharge revenues up, call it $41 million year-over-year. I know you don't break out the fuel category, but the whole category was up $37 million. I guess your thoughts on the ability to sustain those revenues or that gap as fuel starts rolling over, I think any thoughts you can give us to calm some of those nerves out there that as fuel came down, you'd lose that profitability gap? Well, I mean, it, the way I think the first thing I'd make sure we understand is that you know, fuel and fuel surcharge, in particular, are an important part of the cost structure of this business. The fuel surcharge program is tied to kind of our base pricing, that is kind of ongoing, and we continue to make pretty big investments in that. One thing I'd call your make sure you think about as you study our financials is that, you know, as we switch to change our mix in line haul from purchase transportation to, you know, internal fleet, the fuel cost ends up on our internal fuel line, right? Rather than on the PT line. The, you know, that's part of what you see there is we're re-optimizing our line haul network. Perfect. Hey, great. Thanks for the thoughts you said, Ken. Our next question comes from Ravi Shanker with Morgan Stanley. Thanks, morning, everyone. Just a couple of follow-ups from me on the end markets. One is, I know you touched upon the volume outlook a few times, but just kind of at a high level, I think some of your peers, both the LTL and the TL side, have spoken about a potential spring inflection in the cycle. Do you underwrite that view, or are you saying that it's too uncertain to make that call? You know, I think I can understand and where that might, you know, the thoughts around that. I think certainly there is some reason for optimism. The jobs number today was really good. I think there's the potential for optimism there. I think as we reset our business, we want to be in a position that as the economy gets stronger, we want to be able to take advantage of that. We're positioned for that. You know, I think there's definitely some possibility we could see some, you know, second half could be better. You know, at the same time, if there's other sort of macro shocks, that could take it a different direction. I, you know, I... It seems like increasingly we're seeing a more, you know, kind of a little bit of more optimism in the back half of the year. You know, that would be good. Got it. Just on that note, kind of I know you spoke about the industrial end markets earlier, but I think you're a little bit unique in that you have a slightly higher energy market exposure than many of your peers. Given how volatile that has been in 2021 and 2022, kind of is that a tougher comp for you this year, or does that not really matter? It doesn't really matter. I mean, if as you know following us closely that, you know, as we've added the Northeast, that sort of energy exposure probably looks more like the rest of the LTL sort of sector, right? Our book of business is looking more and more similar to everybody else. I don't have a call out there as to its influence on our results. Understood. Thank you very much. Our next question comes from Allison Poliniak with Wells Fargo. Hi. Good morning. Just keeping on that industrial side, you know, a lot of our coverage in the industrial space is really talking about this sort of recalibration year as we smooth down the backlogs, that have extended here with all the supply chain issues. Is that driving any volatility in some of the trends that you're seeing from some of your industrial customers, or are you expecting that, just given some of that lumpiness potentially? You know, Allison, I don't, I don't have a great view on that. I, you know, we do see, and I think this is an important part of our operating flexibility, is that, you know, we do see continued kind of disruption with some of our customers around just order patterns, supply chains changing. You know, those are important parts of our ability to be flexible and match customer expectations. I don't know that there's a particular vertical there, but it's, you know, we see that and have seen that over the last, you know, year or so, where you do see some disruption and sort of month-to-month trading and changing in all parts of the business. Got it. Just as, you know, going back to the facilities you had opened, you had talked about it being a drag to the OR. Does that flip now or as you start to build out and leverage, or is just the volume moderation a little bit heavier this year than maybe you would've expected in terms of that kind of flipping from a drag to OR, you know, to more of a tailwind for you? I mean, I think the opportunity for us is that there's a potential tailwind there, right? You know, What we're really, I think have been successful is replicating that fantastic service that we're offering the customer across these new openings. As customers, become familiar with us in those markets, we have the opportunity, to, you know, kind of grow in those facilities. It's a... I think it, you know, certainly could be something to be beneficial to us in the balance of the year. Great. Thank you. Our next question comes from Ariel Rosa with Credit Suisse. Great. Thanks. I wanted to ask Fritz and Doug, maybe you could give your thoughts on the ability to get to a sub-80 OR kind of over the longer term. I know you said, kind of expectations for 2023 probably, you know, within 100 basis points or so of what we saw for 2022. You know, is the sub-80 still kind of the long-term target, and what's your confidence level around that? Should we also have an expectation that Saia can kind of be top quartile among peers in terms of where its OR lands in any given year? I don't have a reason why not. I gotta be honest with you. We are marching on to that. This is the environment that we're in right now is a little bit more challenging than it has been, but we don't see any reason why our service, our quality can't be. It is in many cases becoming best in class or approaching that, and that deserves an appropriate return. I think that operating in the mid-70s is our expectations or perhaps lower. I mean, certainly the bar has been set, so we're going after it. I don't know why we wouldn't. That's great. Certainly very encouraging to hear. Then just in terms of the five terminal expansions that you're looking at, maybe you could give a little color on what geographies those are focused on. Historically, you've spoken about kind of the benefits that you see in terms of increasing density in a particular geography. Maybe you could give some color on kind of what the expectations are for the benefit that you might get from that. Listen. One we've talked about, if you follow this closely, we've talked about and it's a testament to how challenging real estate is, but we've got a facility that will open in Northeast Atlanta, that'll give us three in this market. This is a growing metropolitan area. We have a challenge being able to provide the best in class service that we would expect in the Northeast part of Atlanta. We added one in Northwest Atlanta, I guess, a year and a half ago and been thrilled with how that we've been able to service those customers and approach that market. We expect more of the same going up the 85 corridor. That's an important add for us. I think it's gonna be a not only are we able to do a great job for the customer there, we'll be able to recruit drivers in that market, we'll create flexibility and capacity in our legacy facility there. You know, we're gonna save, there's gonna be some efficiencies built into that. Just the fact of the matter that we can get to a customer without having to go through an hour and a half of Atlanta traffic is a big deal. I think that, we're excited about that opening. It just can't happen fast enough. That's great. Well, certainly good luck with the opening of those terminals and we'll be watching closely. Thanks. Our next question comes from Bruce Chan with Stifel. Hey, good morning, team. This is actually Andrew Cox on for Bruce. Appreciate the time. Great. Thanks. I just wanted to dive in a little bit. Yes, no problem. Wanted to dive in a little bit on, you know, I appreciate all the detail you guys have given on cost reductions and the natural attrition you guys have allowed to occur in response to slower volumes. I kinda wanted to get a sense of your views on the other side of the equation that might be kinda backfilling a little bit of this excess capacity with maybe transactional shipments. You've talked about your shift to enforcing line haul and maybe having additional backhaul opportunities there, and you've now got 25% latent capacity and your costs are better aligned. We've heard from this week that some of your peers may be taking part in this exercise. Just wanted to know your thoughts on backfilling capacity with maybe some transactional freight. Thanks. Listen, you know, we're all about finding customers that value our fantastic, what we see as very strong service proposition. If there are opportunities for us to go sell and in available capacity, we're on it. In fact, we have several initiatives around that. We're not in the game of leading with price. Frankly, that's not what is appropriate. What is appropriate is to find a customer that understands that, hey, you're gonna get a great product from Saia and, you know, they're gonna pay accordingly and that's gonna fit. You know, maybe in some markets that there's an opportunity for us. We don't, you know, you won't see us participating in simply, you know, price, working on leading with price. That's not our game. We'll find the customers, though, but that's certainly an opportunity as we build capacity. Understood. Thanks for the detail and, congrats on the results. Our final question comes from Jack Atkins with Stephens. Okay, great. Thanks for the follow-up. Doug, I just wanted to circle back real quick to make sure everybody's on the same page on the operating ratio kind of thoughts for the first quarter. You know, if I heard you guys correctly, you're kind of talking about flat operating ratio quarter-to-quarter, sort of fourth quarter to first quarter, which would be in line with seasonality. Is that what you guys said or did I misunderstand that? Yeah, that's right. That's what we've seen historically. Then, you know, Fritz gave a lot of color on Amit's question about, you know, could it be better than that? You know, potentially, but you hate to get out too far over your skis, you know, given, you know, the weather challenges that come up. You know, February a year ago, I think it was a pretty tough comp for us. I think it's mid-teens kinda shipment and tonnage growth last February. We got to get a clean run through there to think that, you know, we could try to forecast something better. Yeah, flat out of Q4 into Q1 would make a lot of sense to us. Okay. Okay. That's what I thought. Just wanted to clarify that. Thank you very much. Thanks, Jack. There are no further questions at this time. I now turn the call back over to Fritz Holzgrefe. Thank you for everyone that's called in to hear the latest update on this Saia performance. We're excited about the opportunities in front of us this coming year, and look forward to providing an update in the next quarter. Thank you.