Thanks for joining us for the final presentation of day one of our 29th Annual Transportation Airline Industrials Conference. I think it's been a lot of information today, and so we're happy to end it with Yellow Corp. With us today, we welcome Darren Hawkins, President and CEO, and Daniel Olivier, Chief Financial Officer, from Yellow. Also, Tony Carreño in the audience from Investor Relations. This is our ninth time hosting Yellow and former Roadway at the BofA & former Merrill Lynch Conference in our 21 years hosting the event. Appreciate the contributions and insights from this sizable less-than-truckload carrier over the years. I think I've met everybody. For those that not, I'm Ken Hoexter, BofA's Air Freight and Surface Transportation and Marine Shipping Analyst. With that, welcome to conference. Thank you. This is kind of an important year for Yellow in terms of, we're in the final innings of the transition to One Yellow. We talked about it last year in terms of kinda how things were progressing and the change, although we were virtual last year, so it was a little bit different. Let me start by handing it over to you and kinda set the stage, talk about the One Yellow plan update, thoughts on financials operations as we go through that. Really at the end of that, kinda what message you want us to walk away with today. All right, well, we'll get started here. Good afternoon, everyone. You've got slides. You wanna get started with those? We do. Okay, perfect. Absolutely. Wanna first start by just thanking you, Ken, and the Bank of America team for having us and allowing us to participate here. Certainly excited to talk to you about all the great things we have going on here at Yellow. Before we get going, just want to remind everyone of the inherent uncertainties that go along with any forward-looking statements that we might make today. I wanna talk to you a little bit and just kinda reframe, you know, Yellow in general, for you. Just an overview of our holding company, Yellow, there. We have a portfolio of LTL brands that of course include Holland, New Penn, Reddaway, and YRC Freight. We also have a brokerage arm in Yellow Logistics. You know, overall, we operate the second-largest LTL network out there. We're the fifth-largest transportation company in North America, and we've been around serving our customers for about 100 years. In 2021, we had about $5.1 billion in revenues. We have over 30,000 employees handling a little over 17 million shipments per year. In our asset structure, 316 terminals. We have over 14,000 power units and over 42,000 pieces of trailing equipment. We've been in trucking for a very long time. We have a lot of exciting things going on. The most exciting piece, as you mentioned, Ken, is really all about our transformation to One Yellow. I'd love to spend just a little bit of time here talking to you about where we are in the journey and really what the journey means for our customers, our employees, and our shareholders. If you look here on the slide, you see to the left there, this is really the roadmap somewhat telling you what we've accomplished so far, and where we are. We started this journey back in 2019, and started it with some of the softer components of the transformation. The first one being getting our sales teams all fully aligned to put one sales executive in front of every customer representing all of our brands. That was accomplished in 2019, followed by a realignment of our operational leadership structure. You know, prior to this, each one of our four fixed asset brands had a different president. They had a completely different operational structure, VPs of ops, directors, and so forth. All of that was aligned to support all brands back in 2019. Of course, the holding company was renamed to Yellow Corporation. Certainly excited after spending time in marketing research, excited to bring the Yellow brand back. Ever since then, we've been very focused on some of the more tangible components of the transformation. Last year, we spent a tremendous amount of time and effort getting all of our fixed asset brands onto one technology platform. Those of you that have been through that know that's always easier said than done, and we are very, very excited to be able to get that done. We did it in three phases. Now all fixed asset brands, all four brands are on the same technology platform, which really sets the stage for the most tangible component of everything to truly transform our business, to modernize our business and go to the market as One Yellow. As we sit here today, we are well underway to start down that road. When we talk about optimizing the network, what we're really talking about is taking our three regional brands that you saw represented on that previous slide that are positioned, the West Coast is Reddaway, our regional carrier in the West Coast. In the Midwest, we have Holland. In the Northeast, we have New Penn. Of course, nationwide, we have YRC Freight that has always been a nationwide long-haul carrier. What this network optimization is really all about is integrating our network to be able to pick up and deliver both regional and long-haul freight, with one pickup call and one driver, and then introduce that, freight into the network in the most efficient way possible. What you see here is, the first phase, which will begin this summer, on the western side of the U.S. We're going to be integrating 89 of our legacy YRC Freight and Reddaway terminals this summer. We're optimizing the entire pickup and delivery operations to ensure that the nearest terminal is picking up and delivering to the customer in the most efficient manner. We're also going to be laying down the network, the line haul network, to be able to perform, both the regional service offering and the long-haul service offering for our customers. We will take this in phases very similar to how we conducted the successful transition of our technology platform, and we will be applying lessons learned, obviously, in phase two and phase three. In the fall, we will move to the Midwest and Northeast portion of the country. By the end of the year, we will wrap it all up with the Southeast and the central portion of the country, and we will be complete with the transition by the end of the year. That is the plan. It is going very well. It is on track and on schedule, and we're certainly excited to bring something new to the market that Yellow historically has not been able to bring, and we're excited about getting it all done. This has been a long journey and something our customers have been asking for a very long time. I wanna turn it over to Daniel real quick for a quick financial update, and then we can take any questions. Before you go there, it's amazing because when was it USF who bought all of it into Yellow and ended up changing to YRC? The argument was you can never integrate an LTL 'cause then you risk losing too much business. Now I think you're gonna prove that by integrating them, you're gonna be able to keep it and eventually flip to growth versus what keeping everything separate, which just was too much of a not able to use all the things together and get the benefits. No, that's a great point, Ken. What's exciting is as we start this process, what I know is day to day in the business right now, we're still operating as four different trucking companies. We're literally, you know, as we speak right now, there's a YRC Freight driver and a Reddaway driver backed up to the same customer's dock. There's a tremendous amount of redundancy in the network. If you really look at the couple slides back, what it illustrates is that really about 70% of the geography has some level of overlap between YRC Freight and one of our regional brands. There's certainly an opportunity here to be able to integrate, but not only integrate, also modernize our network to be able to provide more consistency in service while also providing choice of long-haul and regional services. Super excited about it. Yeah. Sorry, Daniel. Go ahead. Yeah. Thanks. On the left-hand side of slide six here, you can see our LTM revenue is nearly $5.2 billion, which is a roughly 14% increase over prior year. You know, much of that is a result of our focus on our yield strategies, you know, improving our freight mix, you know, really getting paid appropriately for the work that we perform. Operating income on an LTM basis, on the right-hand side there, you see has improved from nearly zero a year ago on an LTM basis to $140 million at the end of Q1. Equally as important, but not on this slide, is that our LTM adjusted EBITDA has nearly doubled to $341 million as of the end of Q1 2022, compared to $171 million in the prior year. Now going to slide six, you know, this is one we get excited about the trajectory of our CapEx investment back into our business. In 2021, you know, we completed one of the largest CapEx plans in our company history. We invested nearly $600 million over a 15-month period. A large piece of that was clearly in replenishing our tractors and trailers. You know, we invested in more than 2,400 tractors, which represented about 17% of our entire fleet and reduced the average age of our fleet by approximately two full years. Then on the trailer side, we replaced nearly 3,600 trailers, which is about 9% of our entire fleet. You know, we're excited about that in-level investment that we were able to make. You know, for 2022, our CapEx plan right now is in the range of $325 million-$400 million, which includes further replenishment of the fleet. You know, we are gonna be subject to some of the supply chain challenges that the OEMs themselves are seeing on the tractor and trailer front. We'll most likely be at the lower end of that range, but still a pretty decent sized investment for 2022. Thanks, Daniel. The last thing I guess I'd leave you with is this, you know, what you said, what do you wanna take away, right? What do you wanna take away from the conversation? We've had our best first quarter of adjusted EBITDA and operating income minus property disposals in six years. LTM EBITDA doubled over the last 12 months. We continue to see strong demand for LTL capacity, and the transformation's well underway. It's on schedule. What we're most excited about is this isn't just an integration exercise. This is about creating a new value proposition for Yellow, where we will have an all-in-one solution for regional and long-haul services that is a nationwide solution. You know, the most growing portion of LTL is certainly in the regional space due to just-in-time shipping and the growth of e-commerce. What we're excited about is taking our regional service and actually integrating them and creating a nationwide service focused on one- and two-day, while continuing to provide that long-haul service that our large corporate accounts and retailers have enjoyed for inventory replenishment purposes and so forth. Super excited about putting all of these puzzle pieces together finally and bringing that solution to our customer base. Yeah. It's absolutely the right move. I'm glad to see you going through the pain, but it's gonna be the right move on the other side. It seems like to have one. No doubt. Consolidated operating entity. No doubt. All right, rapid fire question. How many people in the audience know Yellow, why it's actually orange? Wow. Any answer? I've got one. It was the founder said it was the best. In foggy days, you could see the equipment. That's right. Most recognizable color on the highway. It is called Swamp Holly Orange. Swamp Holly. And- It's not even called Yellow. That's right. I have a 10-year-old daughter that often asks as she sees the truck going down the road, "Dad, why is it called Yellow when it's orange? Great question, honey. Great question. All right, we got the 316 service centers. When you get through this process, you said you're only closing nine? Or is nine phase 1, and there's more to go? How do you think the proper size and scale of the network? Let me explain that. We're gonna let the modeling speak to us on that. phase 1 includes nine consolidation or nine closures. Just phase 1? Just phase 1. Okay. Got it. Got it. I wanna be clear here, these are small terminals. This is where Reddaway and YRC Freight, you know, had certain terminals that are located in the same area. When you look at the cumulative doors here- Yeah. We're talking about less than 300 doors across nine terminals. If you look at that on the grand scheme of Yellow, you know, we have over 19,000 doors. As Darren, our CEO, often mentions, we're not going to give up any of our precious coverage of geography. If you can run the trucks under one roof, it's always better to do so rather than two. That explains that. We expect to land somewhere around 300 by the time this is all said and done. Again, we're allowing the modeling of each phase to really speak to us and allow us to capture whatever efficiencies that we can while not giving up any geography. Man, you could get some good funds for the right sales right now, I presume. I mean, you just hear about the other company's desire to grow. Mix of business, industrial or manufacturing, are we in a position of retail? Yeah. other, food and beverage. Still do a lot of food and beverage. About, you know, over half of ours is, you know, industrial and wholesale, and we still continue to see pretty solid demand there. You know, obviously with retail and e-commerce over the last few years, particularly, we've seen growth there as well, which is always good for, you know, LTL, you know, the middle mile. So we feel really good about our mix. Certainly seeing the demand that we need to see right now. e-commerce within that in terms of the or retail? Is it within- No, I'm sorry. You said 50% is. No, 50% is industrial and wholesale. Just a little over 50% is industrial. What percentage is retail? Retail, I don't have that exact number. That's fine. But- Is e-commerce. It's growing. A sizable portion? I'm trying to figure out in these discussions with LTL, right? LTL has been growing relative to kinda where the truckload's been in terms of gaining share. Mm-hmm. Is it because e-commerce is causing more shipments to be smaller to go to fulfillment centers, or is just LTL demand growing? Trying to understand if there's any kind of fact behind that in terms of aiding the growth. I don't know if there's a direct correlation there. Okay. What we have been able to say is that we know that e-commerce specifically is always positive for us in LTL growth. We can see that in our own customer base. We also have a nice, you know, diversification here, with industrial mixed with retail. Yeah. You know, mixed with e-commerce. We like where we sit right now from a mix perspective. How about percent of your business direct versus coming from 3PLs? You know, our 3PL mix, we've always had very strategic relationships with a select group of 3PLs. You know, our interactions with 3PLs are done on a very, very strategic level to help us balance lanes where necessary. Also, you know, where they can be an advocate for us, for Yellow, they understand our business, know exactly how we operate and what our strengths are, and how to best position that with customers. Those are the 3PLs that we do business with, and it's a little more than 20% of our business. Okay. Spot versus contract, and maybe I'm using the wrong word, but what percentage is exposed to GRIs? You want me to take it? Yeah. Our GRI business, that exposes, you know, between 10% and 15% of our total business. Okay. That's been pretty consistent. Internal versus external, so rail and third-party truck, third-party truckers. Like percentage-wise, I don't rely heavily on the rail, especially for our transcontinental business. When you look at our PT, the major challenges we had in Q1 we had to use a lot of the third-party road, open-road PT, almost 17% of revenue a year ago, down a piece of the reduction there within the third-party road PT resources that handle that part of the business. 20%, 25%, 30%? I don't have that right now. Don't have it. Okay. No. Transition. Tonnage is down. Can you talk about what's on that? Is that intentional in terms of we wanna continue to, I mean, you have large pricing scale program, and can you describe the role? Yeah, I'll start that. It's a combination of both. I mean, there's a heavy focus on getting mentioned earlier. You know, with the inflationary environment that we're in and what the response is, it's a lot more about some of the actions we took in Q1, specifically around tonnage trends for Q1 down almost 28% in February than in March and between 14 and 15 where we kinda started from. I'll let Darren talk about what we did in Q1 and the reasons we did. You know, Q1 of last year in the past, but the reality of the situation with us, and Darren talks about at all times yield over tonnage right now. We're certainly in the process of transforming our business to be able to network. You know, the way our network has been set up in the past, it doesn't promote great fluidity, and it's been introduced into the situation. Whether other Anything of that negative. You know, obviously, we had the compounding impact of the Omicron cases where labor challenges combined put us in a very difficult position at peak time. We felt the appropriate thing to do, proper communication and restricted network in certain areas to be a necessary step, in short. The network was freed up. We certainly found, you know, the tonnage within, you know, the range of where we expect to be. Our story is one of get the network transformed, and then this is totally, it's all about getting ourselves set up to provide that value proposition that we talked about. How's the fleet you've got? Was it 2,400 tractors you purchased? Is that all post-government loan that you've done now? 2,400 is what we did over that 15-month period. Between fourth quarter of 2020, not taking any deliveries with any tractors yet. You're looking at. Is that because of or you've post CapEx investment in tractors was gonna be back half loaded this year anyway. When you think what an even distribution from a CapEx load would be, you know, 2,400 tractors really was three years' worth of window. Yeah. You don't wanna, you know, 10 years down the road, all of a sudden, we need to replace all those tractors again. We got that time, a three-year investment timeframe out of those tractor acquisitions and the. All the tractors really came in over 12 months, and we got the time and space to let that settle in. Not to mention what we'll be doing. That creates asset utilization. That will help us get a better frame for what the. Yeah, certainly. Go ahead. I'm glad you commented on replenishment of two years in the fleet age. I don't see what you're trying to accomplish by such a huge CapEx for you beyond bringing down the fleet age. Availability in the marketplace of tractors. What were you trying to accomplish beyond bringing down the fleet age? Yeah. Well, over the course of time and age, which was much higher total cost of a tractor over its useful life. When you start thinking about not only are you more susceptible to higher cost repairs, breakdowns to your customers, but also the fuel, the return on the investment. For us to do on targeted fleet age, you know, works for that. When you look at the useful life of a tractor. Darren can probably shed more light on operationally what that means to us. All the savings and the cost components of that I mentioned, but the impact on his work that he does, it really plays a big role. It does. I mean, our biggest focus at this point is, you know, to be able to put the appropriate each and every year, and that comes through stronger really all about creating this value proposition so that we can drive, you know, to improve profitability on the bottom line through installments of CapEx investment in the fleet. You know, when the company went through challenging times, that wasn't always possible. Repair and maintenance cost starts to eat you up, and then it starts to impact your service, and then it somewhat becomes a problem downstream. We feel that was a huge pickup for us, but we also know there's work to go. You know, we've got to continue to deliver each and every year, and that's the plan and why One Yellow is such an important piece of where we're going strategically with the organization. Dan, maybe to answer that question, is there a number you give that cost per mile on an older tractor versus what you're paying per mile on a newer tractor? You know, what we've said, you know, publicly is that on each unit, you know, that we replace an older unit with a new unit. The maintenance cost savings alone can be between $10,000 and $12,000 per year. That does not even include the fuel efficiency gains that we gain on the new equipment. Now, that said, again, I mentioned inflationary environment that we're seeing now, specifically in the last six to nine months. You know, part of those gains we have seen obviously get offset by the higher cost of parts and tires and, you know, vendor labor rates, things like that. Yeah, on a unit per unit basis for what we're bringing in versus what we replaced, we certainly saw those cost savings. You're taking a $125,000 tractor over what period of time do you keep the tractors? Do you keep them 10 years? Right now, we're in a 10 year-15 year unit of life. 10 year to 15 year. Yeah, probably at the higher end. We wanna bring that down over time. That just the maintenance alone gets you on your kinda depreciation, your cost per year. There's the added fuel benefits, operating synergies that you said. Everything beyond that then becomes, you know, an advantage on paying it down. Certainly. In terms of the, let's see, industry pricing, and customer demand for capacity, how are you seeing kind of the end market user demand right now? Is there any on the edge decrease in demand? I mean, you're going through, I guess such a shift, maybe the, you know, broader market doesn't matter 'cause you're kinda focused on the shift that you're seeing within company. Is there any commentary you would throw out there in terms of what's going on in the broader market? Yeah, I'll start. I mean, industrial demand is still strong right now. I mean, I saw industrial production numbers again, which is up again for like the fourth month in a row, I believe again. You know, there's pent-up demand for automobiles. The auto industry is like key to overall industrial production. We're still seeing the demand there, and I think that's evidenced by, you know, we're a year into now seeing contract renewals in the upper single digits, low double digits. For all of Q1, we were in the 9% range, and then in April, that even ticked up to be between 10% and 11%. There's nothing I see right now that at least for the foreseeable next two or three quarters, that pricing won't remain strong. Okay. Wonderful. Any other questions? All right. Let's see. We've got, I guess, time for one more, so let me pick a relevant one. The administration's multiemployer pension plan one. Yeah. I'm yeah. Yeah. Look at me again. Pick on the numbers guy over here. Yeah. It seemed like a major shift when that was brought up. In hindsight, is it that monumental of a piece to just get rid of risk, to get rid of the? It is monumental. You think about the risk of the underfunded pensions for a multiemployer pension. The American Rescue Plan, what it did is it provides the path for these pension funds to apply for special financial assistance, you know, based on each of their statuses. They all have different funded statuses that shore up their liabilities to their members or their participants in those plans through 2051 for 30 years. Now, we don't expect that will have an impact on our financial results because we will continue to make our cash contributions. I think for 2022, we'll be in that range of $120 million. What it does, it takes that inherent risk off the table and some of the uncertainty around, you know, as we start negotiating our new contract here in a couple of years. You know, the pension funds themselves having to try to figure out what potentially they would need from, as increases from us. That will become more predictable. Yeah, it was monumental. Yeah. Well, I guess if I were to sum up the kinda the One Yellow in terms of. Or I guess the message that we started with, right? You know, kinda the One Yellow, the kinda overall that we're seeing, industrial production, you mentioned still growing, still a good backdrop. Phase 1, well underway. You know, what we saw last year with the technology, now you're well into the way of the physical, I guess I'd call it the physical integration. I love the pictures where you had with the different sort centers in the slides in terms of what you can really do. So like I said when I started it, really exciting times underway, to see the progress here and see the overall. So good luck with that. Darren and Daniel, thank you very much for participating. Tony Carreño, thanks for being here. Appreciate you coming to the conference. Yeah. Thanks for having us. Thank you, Daniel. Appreciate the invite. Wonderful.