Hello, and welcome to Universal Logistics Holdings Q2 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star followed by zero. A brief question-and-answer session will follow the formal presentation. During the course of this call, management may make forward-looking statements based on their best view of the business as seen today. Statements that are forward-looking relate to Universal's business objectives or expectations and can be identified by the use of the words such as believe, expect, anticipate, and project. Such statements are subject to risks and uncertainties, and actual results could differ materially from those expectations. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Tim Phillips, Chief Executive Officer; Mr. Jude Beres, Chief Financial Officer; and Mr. Steven Fitzpatrick, Vice President of Finance and Investor Relations. Thank you. Mr. Phillips, you may begin. Thank you, Ludy. Good morning, everyone. Thank you for joining Universal's 2024 Q2 Earnings Call. Once again, the theme of the quarter can be summed up in four words: Diversity is our strength. Universal's diversity service offerings are what differentiates us from our competitors in the transportation and logistics space. A nd is what allows us to deliver outstanding results even during this prolonged transportation down cycle. But before I dig into the results, I would also like to take the moment to thank the entire Universal team. The tremendous work and effort of our 10,000-plus employees and contractors are what make these results possible. This is what allows us to deliver outstanding service to our customers and continue to be the best of breed transportation and logistics provider. Now, let's move on to the quarter. Overall, Universal once again delivered outstanding results in the Q2 of 2024. We grew top-line revenue by 12%, delivered double-digit operating margin, increased our earnings per share by 30% compared to the same period last year. We did all this during one of the longest and deepest freight recessions I've experienced. Universal's Q2 results, however, were mixed and varied considerably among our different business segments. Our contract logistics business continues to outperform and deliver excellent results, while our Intermodal and company-managed brokerage segments continue to perform below our expectations. The trucking segment performed well, despite softness in the overall truckload market, on the back of our specialized heavy haul wind business. Q2 was another challenging environment to navigate in the transportation market. However, Universal's diversified business model is working as designed, and I'm very happy with the outcome. For the Q2 2024, Universal reported $462.2 million of revenue, $1.17 of earnings per share, and an operating margin of 10.2%. This was the second-best revenue, earnings per share, and operating margin for the Q2 in Universal's history. In our contract logistics segment, revenues increased 26.2% to $263.6 million. This was largely due to our previously announced specialty development program. At the end of Q2 2024, Universal managed 68 value-added programs, unchanged from Q2 2023. Contract logistics remains our most consistent and profitable segment. This was the 10th straight quarter of operating ratios below 90%, with six of the last ten below 85%, and the last two were below 80%. We expect the strength in this segment to continue going forward. The outlook for automotive industry remains positive, with the SAR for June at 15.3 million and 15.9 million expected for the full year 2024. As the landscape for a transition to electric vehicles continues to evolve, we remain closely in tune with the needs of our customers. As customers' demands drive their production forecast, remain well positioned to support their inbound logistics needs for both EV and ICE platforms. Class 8 production also remains stable, with a large backlog of expected builds for the full year 2024. Overall, our trucking segment is also doing quite well, given the depressed transportation backdrop. Trucking segment revenues increased 12.6% to $91.4 million. This was due to a 28.5% increase in revenue per load, excluding fuel surcharges, while loads hauled decreased 11.1%. Trucking segment results were bolstered by an uptick in our specialized heavy haul wind business. We expect this to continue throughout the rest of the year as we have a full pipeline. This should be a secular headwind for years to come, allowing solid trucking, solid trucking segment performance, sheltered from fluctuations in broader truckload market. Outside of specialized freight, the truckload market remains soft. Flatbed volumes were down once again, and we did not see the increase in rates that we expected. We expect the weakness in the broader truckload market to persist until excess capacity comes out. The Intermodal segment continued to face significant headwinds. In the Intermodal segment, revenues decreased 14.8% to $78.1 million in the Q2 of 2024, compared to Q2 2023. Our Intermodal segment experienced a 4.1% decrease in volume, while rates decreased 5.9%. Additionally, accessorial charges decreased $5.4 million, and fuel surcharge revenue decreased $2.7 million. While it is too soon to say if we have turned the corner, we have seen some improvement and reasons for optimism. Our Intermodal segment had its best results for the year in the final month of Q2, showing our cost-cutting measures are beginning to bear fruit, and we are seeing our highest truck productivity in several quarters. We could see a strong second half of 2024 if 2025 volumes get pulled forward in anticipation of higher tariffs on imports. There could be additional pull forward to get ahead of any labor disputes at the East Coast ports. Any increase in volumes will contribute to our profitability. After streamlining the business and cutting costs, our Southern California operations are ready for whatever the market throws at us in the back half of the year. As far as rates go, we expect to see an increase in spot rates as we get into peak season later in the year. The company-managed brokerage segment also continues to underperform. Revenues decreased 4.9% to $28.1 million, and the business continues to struggle to meet our profitability expectations. The revenue decline was primarily due to 21.9% decrease in revenue per load, which was partially offset by a 20.1% increase in load count. Overcapacity continues to put a damper on pricing and squeeze our gross margins. We were able to take some share back in the quarter, but had to sacrifice margins to do so. The brokerage market is extremely challenging, and some experts do not expect it to recover until these excess capacities come out of the market sometime in 2026. As a result, we are taking a proactive approach in evaluating the brokerage business, looking to rightsize the business as soon as possible and look to cut costs where possible to improve efficiencies and return to profitability. M&A remains a key part of our strategy, with the objective of penetrating new markets, gaining new customers, or densifying an existing market. We're constantly looking for acquisition targets that would be a good fit for Universal while also staying disciplined. A quality target must operate within our core competencies, add to our existing service lines, fit within our target margins, and must be available at a reasonable multiple. Any addition to the portfolio must be accretive to earnings and large enough to move the needle. We are beginning to see more opportunities becoming available, and we'll continue to seek acquisition targets that can be added, that can add value to Universal. As we look ahead, we are encouraged by a robust sales pipeline brimming with opportunity. Specifically, value-added and dedicated opportunities alone account for nearly $750 million. This strong pipeline enables us to be selective, ensuring that we only bid on programs aligned with our core competencies and desired margin profiles. Additionally, we are constantly exploring cross-selling opportunities with our existing customers, aiming to deliver more value through diverse service offerings. Our contract logistics segment serves a wide variety of industries beyond auto OEMs, including aerospace, defense, agriculture, heavy truck, consumer manufacturing, and e-commerce. We continue to discover new and exciting opportunities within these sectors. I'm extremely pleased with our performance in the Q2 of 2024. Universal continues to provide the resiliency and durability of our diverse model in any environment. Once again, I would like to thank all of Universal's stakeholders for their contributions. I remain optimistic for the rest of 2024 and confident about our future. I would now like to turn over to Jude to provide more color on our financials and expectations for the upcoming quarter. Jude? Thanks, Tim. Good morning, everyone. Yesterday, Universal Logistics Holdings reported consolidated net income of $30.7 million, or $1.17 per share, on total operating revenues of $462.2 million in the Q2 of 2024. This compares to net income of $23.6 million, or $0.90 per share, on total operating revenues of $412.6 million during the same period last year. Consolidated income from operations was $47.1 million for the quarter, compared to $36.4 million one year earlier. EBITDA increased to $29 million to 84.8 million, which compares to $55.8 million during the same period last year. Our operating margin and EBITDA margin for the Q2 of 2024 are 10.2% and 18.4% of total operating revenues. These metrics compare to 8.8% and 13.5%, respectively, in the Q2 of 2023. During the quarter, Universal took an $11.3 million charge to depreciation expense. This charge was due to revisions made to the useful lives and salvage values of certain pieces of equipment, primarily Class 8 tractors. Prior to COVID, it was not uncommon for 4- to 5-year-old tractors to retain a 40%-50% salvage value when sold on either the open market or traded in for new models. Now, after the extreme bubble experienced in the used truck prices during COVID, we have seen a massive unwind in the value of used tractors. We are now seeing residual values fall to 20%-25% of historical cost. This update to the estimated residual values on certain tractors resulted in the additional depreciation expense, impacting our operating ratio by 245 basis points. Looking at our segment performance for the Q2 of 2024, in our contract logistics segment, which includes our value add and dedicated transportation businesses, income from operations increased $20.1 million to $52.9 million on 236.6 million of total operating revenues. This compares to operating income of $32.8 million on 208.8 million of total operating revenue in the Q2 of 2023. Operating margins for the quarter were 20.1% of total operating revenues, compared to 15.7% one year earlier. We continue to make excellent progress on our specialty development contract logistics program. During the Q2 of 2024, we recognized an additional $44.6 million of operating revenues related to this program. This brings our year-to-date total operating revenues on this program to $139.8 million. As a reminder, during the full year 2024, we expect to recognize total operating revenues on this program of approximately $228 million and continue to expect this program to be substantially complete by 1 January 2025. Revenues generated from this program are reported in the value-added services line and the associated costs in operating supplies and expense. The results of this program are included in our contract logistics segment. Based on its current cadence, we expect this program to generate additional revenues in the range of $40 million-50 million during the Q3 and Q4s of 2024. Our guidance, that I will discuss momentarily, reflects the expected impact of this program during the Q3. On to our Intermodal segment. Operating revenues decreased $13.5 million to 78.1 million, compared to $91.6 million in the same period last year, and income from operations decreased $8.1 million to an operating loss of $8.3 million. This compares to an operating loss of $200,000 in the Q2 of 2023. Operating ratios for the quarter were 110.6% versus 100.3% last year. In our trucking segment, operating revenues for the quarter increased $10.2 million to 91.4 million, compared to $81.2 million in the same quarter last year, and income from operations remained flat at $4.4 million during both quarters of 2024 and 2023. Operating margins for the quarter were 4.8% versus 5.4% last year. In our company managed brokerage segment, operating revenues for the quarter decreased $1.5 million to 28.1 million, compared to $29.6 million in the same quarter last year, and income from operations decreased $1.5 million to an operating loss of $2.2 million. This compares to an operating loss of $800,000 in the Q2 of 2023. Our company-managed brokerage segment reported an operating ratio of 107.9, 102.7 in the Q2 last year. On our balance sheet, we held cash and cash equivalents totaling $7.5 million and $11.6 million of marketable securities. Outstanding interest-bearing debt, net of $4 million of debt issuance costs, totaled $483.8 million at the end of the period. Excluding lease liabilities related to ASC 842, our net interest-bearing debt to reported TTM EBITDA was 1.65 times. Capital expenditures for the quarter totaled $77.1 million. For the full year, we are expecting capital expenditures to be in the $315-330 million range, and interest expense to come in between $30-32 million. Based on the current operating environment and the expected cadence of the new contract logistics program mentioned earlier, for the Q3 of 2024, we are expecting top-line revenues between $450 million and 475 million, and margins in the 9%-11% range. Finally, Wednesday, our board of directors declared Universal's $0.105 per share regular quarterly dividend. This quarter's dividend is payable to shareholders of record at the close of business on 2 September 2024, and is expected to be paid on 1 October 2024. With that, Ludy, we're ready to take some questions. Thank you. And ladies and gentlemen, we will now begin the question-and-answer session. If you would like to ask a question, please press the star one on your telephone keypad to raise your hand and join the queue. If you're using a speakerphone, please pick up your handset before pressing any keys. If you would like to withdraw your question, simply press star two. Again, please press star one to join the queue. One moment, please, for your first question. And your first question comes from the line of Bruce Chan with Stifel. Please go ahead. Hey, good morning, and thanks, as always. Maybe just to start here with contract logistics. You know, you showed some really nice growth in that division, even, you know, if you strip out the special project business. But it does look like programs are down from, I think, 71 quarter-over-quarter to 68. Is there anything to read from that, or was that just kind of the normal cadence of contracts rolling off? No, that's, that's just the normal cadence of contracts rolling off. In this particular situation, we had some end-of-life agreements, and that were moved out, and we continued to move new opportunities in to replace those. And as the pipeline continues to fill, we have the hope and the opportunity it will continue to build on the 68 that we exited on Q2 with. Okay, that's, that's good to hear. And I think you said it was like $600 million-750 million of pipeline opportunity. Right. You know, just kind of wondering, you know, given the softer backdrop, if, you know, you expect any changes in maybe the rate of conversion of that pipeline or any, you know, maybe elongation in the, in the sales cycle, or, you know, are customers still kind of just making decisions as normal? So far, customers are making decisions as normal. If I debundle the transportation from the four walls type of activity in the contract logistics, there's been more pressure put on the transportation sector as we look to advance in new bids or even renew bids. So, we're cautiously optimistic as we work our way through that. There's still been a level of consistency on the value-added services bid, and we still see a full pipeline. You know, the determining factor on that will be, you know, as corporations look at their internal costs for employees, do we provide a logical solution, an outsourced solution for those companies? I think we do, but, you know, we have to sort through that. That does take a little bit of time from a sales cycle standpoint as the company's management structure makes sure they look at their P's and Q's. But once again, I'm cautiously optimistic that we'll continue to see additional outsourcing opportunities. Okay. That's, that's great. That's good to hear. And then, Jude, you know, you talked about residual values on used trucks falling and, you know, that was you know, big factor in the you know, depreciation revision. Seems like that is, you know, maybe a healthy indication of capacity exiting the market. But I'm also wondering on the flip side, if that raises, you know, maybe any concerns about what Class 8 activity might look like as we, you know, move into 2025 and beyond, and just kind of how you're thinking about that. Yeah, for sure. I just think, Bruce, that all companies in the space just have to be really smarter about what these residual values are going to be in a post-COVID environment. I mean, there seems to be a glut of trucks on the market. And you can see from the, you know, the ACT numbers that, you know, orders were down markedly, sequentially from, you know, Q1 to Q2, coupling that with really, really soft residuals. Yeah, I think there's going to be some concern. We really haven't seen a decline in prices of the Class 8 trucks, though, which would be a great indication for us that, hey, there is he OEMs are recognizing some form of oversupply. We expect that to happen, but we really haven't seen it yet. So Universal, once again, we're just trying to manage our own balance sheet and our own assets. And, when we see, you know, a pretty, large delta between what the expectation was and what the reality is, we're just reacting to it. Okay, that's great. Then just switching gears here a little bit to Intermodal. You know, we've seen some good inbound volumes to the West Coast ports. Maybe if you could just walk us through, you know, kind of this disparity between those numbers and then what you're seeing in terms of, you know, load volumes, and, you know, wondering if that's maybe just a delay between those volumes showing up in your network, or if there's some other reason why, you know, maybe you wouldn't be seeing that uplift. Yeah, the inbound into the West Coast is up. I wouldn't say that from the customer base that we're moving freight for right now on the West Coast, we have experienced that type of double-digit uptick. And as we look as the freight moves itself inland into the Midwest and other parts of the country, we would expect to see some uplift from that. And I would say that if I had to have one market that I've seen some uptick based on those West Coast numbers, would be the inbound coming off the West Coast into Chicago. So, we have seen some uptick there. The other markets are harder to read, but we would think that an uptick in West Coast imports should filter into the inland parts of the United States. To that point, we mentioned that, you know, the month of June was one of our best months from an Intermodal standpoint. So that's somewhat reflective of that inbound volumes. And if we strip out California from those numbers, I thought we had a fairly decent June as a whole, other than California, on the Intermodal front. Yeah, Bruce, and just to give a little bit more color to Tim's comments on the legacy non-California business, June had our largest load counts for the entire year, and although California was still down sequentially, it was down less than 600 loads for the quarter. So we are seeing a little bit of a repair to those volumes. But once again, we're just really cautiously optimistic because there's still a lot of carriers that are taking freight at below market prices. Got it. That's great color. And then just a last question here as a kind of point of clarification. You know, Tim, you talked about trucking and, you know, you're certainly seeing some very nice increases there in revenue and revenue per load, which you attributed to the specialized heavy haul. You said that, you know, you were expecting that to be a secular headwind in subsequent years. I just want to make sure I heard that correctly. Well, sometimes I get coming and going confused. That, that should be a good tailwind. Okay. All right. Yeah, I've only had two cups of coffee. Okay. I just, I just wanted to clarify that point. Okay, great. Yeah. That's all I have. You know, really appreciate the time, as always. Congratulations. Hey, thanks, Bruce. Thank you. We appreciate it. Thank you. Once again, if you would like to ask a question, please press star one. There are no further questions at this time. I would like to turn it back to Mr. Phillips for closing remarks. Thank you, Ludy. Universal continued to employ various cost-cutting strategies while advancing our various opportunities in key segments and verticals. I'm pleased with our continuous improvement plan, which encompasses our human assets, the use of technology, and the focus on the customer's needs and visibility. I appreciate everyone taking time to listen this morning, and look forward to talking to you in Q3 earnings call in October. Thank you. Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you all for participating. You may now disconnect.