SAIA INC

Previous wording

The Company’s operating revenue increased by 18.5 percent in the second quarter of 2024 compared to the same period in 2023. The increase resulted primarily from increases in shipments and tonnage partially as a result of the redistribution of freight due to a competitor bankruptcy. In the second quarter of 2024, LTL shipments were up 18.1 percent and LTL tonnage was up 9.7 percent compared to the prior year quarter. Additionally, increases in revenue were driven by improved revenue per hundredweight due to pricing and changes in business mix.

Current wording

The Company’s operating revenue increased by 8.6 percent in the third quarter of 2024 compared to the same period in 2023. The increase resulted primarily from increases in shipments and tonnage. In the third quarter of 2024, LTL shipments per workday were up 8.5 percent and LTL tonnage per workday was up 7.7 percent compared to the prior year quarter.

Previous wording

Consolidated operating income was $137.6 million for the second quarter of 2024 compared to $120.3 million for the second quarter of 2023. Diluted earnings per share were $3.83 in the second quarter of 2024 compared to diluted earnings per share of $3.42 in the prior year quarter. The operating ratio (operating expenses divided by operating revenue) was 83.3 percent in the second quarter of 2024 compared to 82.7 percent in the second quarter of 2023. The Company generated $237.2 million in net cash provided by operating activities in the first six months of 2024 compared with $291.4 million in the same period last year. The Company opened six new terminals and relocated an additional two terminals during the second quarter of 2024.

Current wording

Consolidated operating income was $125.2 million for the third quarter of 2024 compared to $128.4 million for the third quarter of 2023. Diluted earnings per share were $3.46 in the third quarter of 2024 compared to diluted earnings per share of $3.67 in the prior year quarter. The operating ratio (operating expenses divided by operating revenue) was 85.1 percent in the third quarter of 2024 compared to 83.4 percent in the third quarter of 2023. The Company generated $419.0 million in net cash provided by operating activities in the first nine months of 2024 compared with $416.3 million in the same period last year. The Company opened eleven new terminals and relocated one additional terminal during the third quarter of 2024.

Previous wording

Saia is a transportation company headquartered in Johns Creek, Georgia that provides national less-than-truckload (LTL) services through a single integrated organization. While more than 97 percent of revenue is historically derived from transporting LTL shipments across 46 states, the Company also offers customers a wide range of other value-added services, including non-asset truckload, expedited transportation and logistics services across North America.

Current wording

Saia is a transportation company headquartered in Johns Creek, Georgia that provides national less-than-truckload (LTL) services through a single integrated organization. While more than 97 percent of revenue is historically derived from transporting LTL shipments across 48 states, the Company also offers customers a wide range of other value-added services, including non-asset truckload, expedited transportation and logistics services across North America.

Previous wording

Quarter and six months ended June 30, 2024 compared to quarter and six months ended June 30, 2023

Current wording

Quarter and nine months ended September 30, 2024 compared to quarter and nine months ended September 30, 2023

Previous wording

Consolidated revenue for the quarter ended June 30, 2024 increased 18.5 percent to $823.2 million primarily as a result of increases in shipments and tonnage partially as a result of the redistribution of freight due to a competitor bankruptcy. For the second quarter of 2024, Saia’s LTL tonnage was up 9.7 percent to 1.6 million tons, and LTL shipments increased 18.1 percent to 2.3 million shipments. LTL revenue per hundredweight, excluding fuel surcharge, increased 8.7 percent to $21.69 per hundredweight for the second quarter of 2024 as a result of changes in business mix and pricing actions. For the second quarter of 2024, approximately 75 percent of the Company’s operating revenue was subject to specific customer price negotiations that occur throughout the year. The remaining 25 percent of operating revenue was subject to a general rate increase. For customers subject to a general rate increase, Saia implemented 7.5 and 6.5 percent general rate increases on December 4, 2023 and January 30, 2023, respectively. Competitive factors, customer turnover and mix changes impact the extent to which customer rate increases are retained over time.

Current wording

Consolidated revenue for the quarter ended September 30, 2024 increased 8.6 percent to $842.1 million primarily as a result of increases in shipments and tonnage partially as a result of the redistribution of freight due to a competitor bankruptcy in 2023. For the third quarter of 2024, Saia’s LTL tonnage was up 9.4 percent to 1.6 million tons, and LTL shipments increased 10.2 percent to 2.4 million shipments. LTL revenue per hundredweight, excluding fuel surcharge, increased 1.7 percent to $21.75 per hundredweight for the third quarter of 2024 as a result of changes in business mix and pricing actions. For the third quarter of 2024, approximately 75 percent of the Company’s operating revenue was subject to specific customer price negotiations that occur throughout the year. The remaining 25 percent of operating revenue was subject to a general rate increase. For customers subject to a general rate increase, Saia implemented 7.5 and 6.5 percent general rate increases on December 4, 2023 and January 30, 2023, respectively. Competitive factors, customer turnover and mix changes impact the extent to which customer rate increases are retained over time.

Previous wording

Operating revenue includes revenue recognized from the Company’s fuel surcharge program, which is designed to reduce exposure to fluctuations in diesel fuel prices by adjusting total freight charges to account for changes in the price of diesel fuel. The Company’s fuel surcharge is generally based on the average national price for diesel fuel (as published by the United States Energy Information Administration) and is typically reset weekly. Fuel surcharges are widely accepted in the industry and are a significant component of revenue and pricing. Fuel surcharges are an integral part of customer contract negotiations, but represent only one portion of overall customer price negotiations, as customers may negotiate increases in base rates instead of increases in fuel surcharges or vice versa. Fuel surcharge revenue as a percentage of operating revenue decreased to 15.4 percent for the quarter ended June 30, 2024 compared to 15.9 percent for the quarter ended June 30, 2023, as a result of decreases in the average cost of diesel fuel and changes in customer mix.

Current wording

Operating revenue includes revenue recognized from the Company’s fuel surcharge program, which is designed to reduce exposure to fluctuations in diesel fuel prices by adjusting total freight charges to account for changes in the price of diesel fuel. The Company’s fuel surcharge is generally based on the average national price for diesel fuel (as published by the United States Energy Information Administration) and is typically reset weekly. Fuel surcharges are widely accepted in the industry and are a significant component of revenue and pricing. Fuel surcharges are an integral part of customer contract negotiations, but represent only one portion of overall customer price negotiations, as customers may negotiate increases in base rates instead of increases in fuel surcharges or vice versa. Fuel surcharge revenue as a percentage of operating revenue decreased to 14.8 percent for the quarter ended September 30, 2024 compared to 16.9 percent for the quarter ended September 30, 2023, as a result of decreases in the average cost of diesel fuel and changes in customer mix.

Previous wording

For the six months ended June 30, 2024, operating revenues were $1.6 billion, up 16.4 percent from operating revenues for the six months ended June 30, 2023 primarily as a result of increases in shipments and tonnage partially as a result of the redistribution of freight due to a competitor bankruptcy. Fuel surcharge revenue as a percentage of operating revenue decreased to 15.5 percent for the six months ended June 30, 2024 compared to 16.8 percent for the six months ended June 30, 2023, as a result of decreases in the average cost of diesel fuel and changes in customer mix.

Current wording

For the nine months ended September 30, 2024, operating revenues were $2.4 billion, up 13.6 percent from operating revenues for the nine months ended September 30, 2023 primarily as a result of increases in shipments and tonnage partially as a result of the redistribution of freight due to a competitor bankruptcy in 2023. Fuel surcharge revenue as a percentage of operating revenue decreased to 15.3 percent for the nine months ended September 30, 2024 compared to 16.9 percent for the nine months ended September 30, 2023, as a result of decreases in the average cost of diesel fuel and changes in customer mix.

Previous wording

Consolidated operating income was $137.6 million in the second quarter of 2024 compared to $120.3 million in the prior year quarter. Overall, the increase in consolidated operating income was the result of increased volumes partially offset by increased operating expenses during the second quarter of 2024, primarily driven by the expanded footprint of opening eight new terminals and nine relocations during the past twelve months. The second quarter of 2024 operating ratio (operating expenses divided by operating revenue) was 83.3 percent compared to 82.7 percent for the same period in 2023.

Current wording

Consolidated operating income was $125.2 million in the third quarter of 2024 compared to $128.4 million in the prior year quarter. Overall, the decrease in consolidated operating income was the result of increased operating expenses, primarily driven by the expanded footprint of opening eighteen new terminals and eight relocations during the past twelve months, partially offset by increased volumes during the third quarter of 2024. The third quarter of 2024 operating ratio (operating expenses divided by operating revenue) was 85.1 percent compared to 83.4 percent for the same period in 2023.

Previous wording

Salaries, wages and employees’ benefits increased $60.4 million in the second quarter of 2024 compared to the second quarter of 2023. This change was primarily driven by increases in headcount, employee hours worked and training hours in response to overall increased volumes and expanded footprint, and by a Company-wide wage increase in July 2023 of approximately 4.1 percent. In addition, workers’ compensation expense increased by approximately $2.5 million related to new claims, unfavorable development on existing claims and increased headcount. Purchased transportation increased $11.3 million in the second quarter of 2024 compared to the second quarter of 2023 primarily due to increases in both non-asset truckload volume and LTL purchased transportation miles. Fuel, operating expenses and supplies increased by $27.4 million compared to the second quarter of 2023 largely due to increased facility costs, administrative costs and fuel costs due to increased volumes and the expanded footprint. Claims and insurance expense in the second quarter of 2024 was $1.9 million higher than the second quarter of 2023 primarily due to increased claim activity and development of open cases. Depreciation and amortization expense increased $7.9 million in the second quarter of 2024 compared to the same period in 2023 primarily due to ongoing investments in revenue equipment, real estate and technology partially offset by an approximate $2.0 million decrease in depreciation expense due to the change in estimated remaining useful life of certain trailers and dollies during the second quarter of 2024. Refer to Note 1 to the accompanying unaudited condensed consolidated financial statements in this Current Report on Form 10-Q.

Current wording

Salaries, wages and employees’ benefits increased $53.5 million in the third quarter of 2024 compared to the third quarter of 2023. This change was primarily driven by increases in headcount, employee hours worked and training hours in response to overall increased volumes and expanded footprint, and by a Company-wide wage increase in July 2024 of approximately 4.1 percent. In addition, workers’ compensation expense increased by approximately $5.1 million related to new claims, unfavorable development on existing claims and increased headcount. Purchased transportation decreased $11.2 million in the third quarter of 2024 compared to the third quarter of 2023 primarily due to a decrease in LTL purchased transportation miles as a result of workforce and network optimization. Fuel, operating expenses and supplies increased by $14.5 million compared to the third quarter of 2023 largely due to increased facility costs and administrative costs related to increased volumes and the expanded footprint. Claims and insurance expense in the third quarter of 2024 was $1.3 million higher than the third quarter of 2023 primarily due to increased claim activity and development of open cases. Depreciation and amortization expense increased $9.0 million in the third quarter of 2024 compared to the same period in 2023 primarily due to ongoing investments in revenue equipment, real estate and technology.

Previous wording

For the six months ended June 30, 2024, consolidated operating income was $255.5 million, up 16.5 percent compared to $219.4 million for the six months ended June 30, 2023. This increase in consolidated operating income was the result of increased volumes partially offset by increased operating expenses during the during the first six months of 2024.

Current wording

For the nine months ended September 30, 2024, consolidated operating income was $380.7 million, up 9.4 percent compared to $347.8 million for the nine months ended September 30, 2023. This increase in consolidated operating income was the result of increased volumes partially offset by increased operating expenses during the during the first nine months of 2024.

Previous wording

Salaries, wages and benefits increased $103.1 million during the first six months of 2024 compared to the same period last year. This change was primarily driven by increased volumes and expanded footprint, and by a Company-wide wage increase in July 2023 of approximately 4.1 percent. In addition, other employee related costs increased, including increased training hours and unfavorable development of workers’ compensation claims. Purchased transportation increased $17.1 million for the first six months of 2024 compared to the same period in the prior year primarily due to increases in both non-asset truckload volume and LTL purchased transportation miles. Fuel, operating expenses and supplies increased $42.1 million during the first six months of 2024 compared to the same period last year largely due to increased facility costs, administrative costs and fuel costs due to increased volumes and expanded footprint. During the first six months of 2024, claims and insurance expense was $5.3 million higher than the same period last year primarily due to increased claim activity and development of open claims. Depreciation and amortization expense increased $13.8 million during the first six months of 2024 compared to the same period in 2023 primarily due to ongoing investments in revenue equipment and network expansion.

Current wording

Salaries, wages and benefits increased $156.6 million during the first nine months of 2024 compared to the same period last year. This change was primarily driven by increased volumes and expanded footprint, and by a Company-wide wage increase in July 2024 of approximately 4.1 percent. In addition, other employee related costs increased, including increased training hours and unfavorable development of workers’ compensation claims. Purchased transportation increased $5.9 million for the first nine months of 2024 compared to the same period in the prior year primarily due to increased non-asset truckload volume. Fuel, operating expenses and supplies increased $56.5 million during the first nine months of 2024 compared to the same period last year largely due to increased facility costs and administrative costs related to increased volumes and expanded footprint. During the first nine months of 2024, claims and insurance expense was $6.5 million higher than the same period last year primarily due to increased claim activity and development of open claims. Depreciation and amortization expense increased $22.9 million during the first nine months of 2024 compared to the same period in 2023 primarily due to ongoing investments in revenue equipment and network expansion.

Previous wording

Interest expense for the quarter and six months ended June 30, 2024 was higher than the same period in 2023 due to interest expense related to borrowings under the credit arrangements.

Current wording

Interest expense for the quarter and nine months ended September 30, 2024 was higher than the same period in 2023 due to interest expense related to increased borrowings under the credit arrangements.

Previous wording

Interest income for the quarter and six months ended June 30, 2024 was lower than the same period in 2023 due to decreased deposit balances during the period.

Current wording

Interest income for the quarter and nine months ended September 30, 2024 was lower than the same period in 2023 due to decreased deposit balances during the period.

Previous wording

The effective tax rate was 24.4 percent and 24.7 percent for the quarters ended June 30, 2024 and 2023, respectively. For the six months ended June 30, 2024 and 2023, the effective tax rate was 24.1 and 24.0 percent, respectively.

Current wording

The effective tax rate was 24.4 percent and 24.6 percent for the quarters ended September 30, 2024 and 2023, respectively. For both the nine months ended September 30, 2024 and 2023, the effective tax rate was 24.2 percent.

Previous wording

Net income was $102.5 million, or $3.83 per diluted share, in the second quarter of 2024 compared to net income of $91.3 million, or $3.42 per diluted share, in the second quarter of 2023. Net income was $193.2 million, or $7.21 per diluted share, for the first six months of 2024 compared to net income of $167.4 million, or $6.27 per diluted share, for the first six months of 2023.

Current wording

Net income was $92.7 million, or $3.46 per diluted share, in the third quarter of 2024 compared to net income of $98.2 million, or $3.67 per diluted share, in the third quarter of 2023. Net income was $286.0 million, or $10.68 per diluted share, for the first nine months of 2024 compared to net income of $265.6 million, or $9.93 per diluted share, for the first nine months of 2023.

Previous wording

Our business remains highly correlated to non-service sectors of the general economy and competitive pricing pressures, as well as the success of Company-specific improvement initiatives. Our outlook is dependent on a number of external factors, including strength of the economy, inflation, labor availability, diesel fuel prices and supply chain constraints. The potential impact of these factors on our operations, financial performance and financial condition, as well as the impact on our ability to successfully execute our business strategies and initiatives, remains uncertain and difficult to predict. We are continuing initiatives to improve and enhance customer service in an effort to support our ongoing pricing and business mix optimization, while seeking to control costs and improve productivity. Planned revenue initiatives include building density in our current geography, targeted marketing initiatives to grow revenue in more profitable areas, further expanding our geographic and terminal network, as well as pricing and yield management. On December 4, 2023 and January 30, 2023 Saia implemented 7.5 and 6.5 percent general rate increases, respectively, for customers comprising approximately 25 percent of Saia’s operating revenue. The extent of success of these revenue initiatives is impacted by what proves to be the underlying economic trends, competitor initiatives and other factors discussed under “Cautionary Note Regarding Forward-Looking Statements” and Part II, Item 1A. “Risk Factors.”

Current wording

Our business remains highly correlated to non-service sectors of the general economy and competitive pricing pressures, as well as the success of Company-specific improvement initiatives. Our outlook is dependent on a number of external factors, including strength of the economy, inflation, labor availability, diesel fuel prices and supply chain constraints. The potential impact of these factors on our operations, financial performance and financial condition, as well as the impact on our ability to successfully execute our business strategies and initiatives, remains uncertain and difficult to predict. We are continuing initiatives to improve and enhance customer service in an effort to support our ongoing pricing and business mix optimization, while seeking to control costs and improve productivity. Planned revenue initiatives include building density in our current geography, targeted marketing initiatives to grow revenue in more profitable areas, further expanding our geographic and terminal network, as well as pricing and mix management. On October 21, 2024, December 4, 2023 and January 30, 2023 Saia implemented 7.9, 7.5 and 6.5 percent general rate increases, respectively, for customers comprising approximately 25 percent of Saia’s operating revenue. The extent of success of these revenue initiatives is impacted by what proves to be the underlying economic trends, competitor initiatives and other factors discussed under “Cautionary Note Regarding Forward-Looking Statements” and Part II, Item 1A. “Risk Factors.”

Previous wording

Effective July 2024, the Company implemented a market competitive salary and wage increase for all employees. The increase is expected to be approximately 4.1 percent, and the Company anticipates the impact will be partially offset by productivity and efficiency gains.

Current wording

Effective July 2024, the Company implemented a market competitive salary and wage increase for all employees. The increase was approximately 4.1 percent, and the Company anticipates the impact will be partially offset by productivity and efficiency gains.

Previous wording

Working capital at June 30, 2024 was $118.2 million, a decrease from $311.6 million at June 30, 2023.

Current wording

Working capital at September 30, 2024 was $90.7 million, a decrease from $346.4 million at September 30, 2023.

Previous wording

Current assets at June 30, 2024 decreased by $132.8 million as compared to June 30, 2023, driven by a decrease in cash and cash equivalents of $223.8 million to fund the Yellow Corporation real estate acquisitions, partially offset by an increase in accounts receivable of $76.3 million. Current liabilities increased by $60.5 million at June 30, 2024 compared to June 30, 2023 largely due to an increase in accounts payable and other current liabilities.

Current wording

Current assets at September 30, 2024 decreased by $208.2 million as compared to September 30, 2023, driven by a decrease in cash and cash equivalents of $234.9 million to fund the Yellow Corporation real estate acquisitions, partially offset by an increase in accounts receivable of $26.5 million. Current liabilities increased by $47.4 million at September 30, 2024 compared to September 30, 2023 largely due to an increase in accounts payable and other current liabilities.

Previous wording

Cash flows provided by operating activities were $237.2 million for the six months ended June 30, 2024 versus $291.4 million for the six months ended June 30, 2023. The decrease is primarily due to an increase in accounts receivable and changes in other assets and liabilities, partially offset by additional net income. For the six months ended June 30, 2024, net cash used in investing activities was $676.3 million compared to $226.5 million in the same period last year, a $449.8 million increase. This increase resulted from the acquisition of terminals from Yellow Corporation in January 2024 in addition to increased revenue equipment purchases to support higher volumes. For the six months ended June 30, 2024, net cash provided by financing activities was $154.0 million compared to $17.3 million net cash used in financing activities during the same period last year, as a result of borrowings to help fund capital expenditures during the first six months of 2024.

Current wording

Cash flows provided by operating activities were $419.0 million for the nine months ended September 30, 2024 versus $416.3 million for the nine months ended September 30, 2023. For the nine months ended September 30, 2024, net cash used in investing activities was $868.2 million compared to $337.0 million in the same period last year, a $531.2 million increase. This increase resulted from the acquisition of terminals from Yellow Corporation in January 2024 in addition to increased purchases of revenue equipment to support higher volumes and expanded footprint. For the nine months ended September 30, 2024, net cash provided by financing activities was $167.5 million compared to $17.4 million net cash used in financing activities during the same period last year, as a result of borrowings to fund capital expenditures during the first nine months of 2024.

Previous wording

The Company has historically generated cash flows from operations to fund a large portion of its capital expenditure requirements. The timing of capital expenditures can largely be managed around the seasonal working capital requirements of the Company. The Company believes it has adequate sources of capital to meet short-term liquidity needs through its cash on hand, operating cash flows and availability under its credit arrangements, discussed below. Future operating cash flows are primarily dependent upon the Company’s profitability and its ability to manage its working capital requirements, primarily accounts receivable, accounts payable and wage and benefit accruals.

Current wording

The Company has historically generated cash flows from operations to fund a large portion of its capital expenditure requirements. The timing of capital expenditures can largely be managed around the seasonal working capital requirements of the Company. The Company believes it has adequate sources of capital to meet short-term liquidity needs through its cash on hand, operating cash flows and availability under its credit arrangements, discussed below. Future operating cash flows are primarily dependent upon the Company’s profitability and its ability to manage its working capital requirements.

Previous wording

The Company currently anticipates that net capital expenditures in 2024 will be in excess of $1 billion, subject to ongoing evaluation of market conditions. Anticipated capital expenditures for the remainder of the year include normal replacement cycles of revenue equipment, investments in technology and revenue equipment and real estate investments to support our growth initiatives, including the plan to open 12 to 15 additional terminals in the third and fourth quarters. Net capital expenditures were $681.3 million in the first six months of 2024 and include $235.7 million for the acquisition of 17 Yellow Corporation freight terminals. Additionally, $7.9 million was used to fund the acquisition of Yellow Corporation's interest in leases for 11 freight terminals and the payment of cure costs. Approximately $152.8 million of the 2024 remaining capital budget was committed as of June 30, 2024.

Current wording

The Company currently anticipates that net capital expenditures in 2024 will be approximately $1 billion, subject to ongoing evaluation of market conditions. Anticipated capital expenditures for the remainder of the year include normal replacement cycles of revenue equipment, investments in technology and revenue equipment and real estate investments to support our growth initiatives, including the plan to open four additional terminals in the fourth quarter. Net capital expenditures were $873.2 million in the first nine months of 2024 and include $235.7 million for the acquisition of 17 Yellow Corporation freight terminals. Additionally, $7.9 million was used to fund the acquisition of Yellow Corporation's interest in leases for 11 freight terminals and the payment of cure costs. Approximately $90.3 million of the 2024 remaining capital budget was committed as of September 30, 2024.

Previous wording

The Company is a party to an unsecured credit agreement with its banking group (the Revolving Credit Facility), which provides up to a $300 million revolving line of credit through February 2028. The Revolving Credit Facility contains an accordion feature that allows the Company to increase the size of the facility by up to $150 million, subject to certain conditions and availability of lender commitments. Borrowings under the Revolving Credit Facility bear interest at the Company’s election at a variable rate equal to (a) one, three or six month term SOFR (the forward-looking secured overnight financing rate) plus 0.10%, or (b) an alternate base rate, in each case plus an applicable margin. The applicable margin is between 1.00% and 1.75% per annum for term SOFR loans and between 0.00% and 0.75% per annum for alternate base rate loans, in each case based on the Company’s leverage ratio, as defined in the agreement. The Company also accrues fees based on the daily unused portion of the Revolving Credit Facility, which is between 0.0125% and 0.025% based on the Company’s consolidated net lease adjusted leverage ratio. Under the Revolving Credit Facility, the Company is subject to a maximum consolidated net lease adjusted leverage ratio of less than 3.50 to 1.00 with the potential to be temporarily increased in the event the Company makes an acquisition that meets certain criteria. The Revolving Credit Facility contains certain customary representations and warranties, affirmative and negative covenants and provisions relating to events of default. Under the Revolving Credit Facility, if an event of default occurs, the banks will be entitled to take various actions, including the acceleration of amounts due. The Company was in compliance with its debt covenants at June 30, 2024.

Current wording

The Company is a party to an unsecured credit agreement with its banking group (the Revolving Credit Facility), which provides up to a $300 million revolving line of credit through February 2028. The Revolving Credit Facility contains an accordion feature that allows the Company to increase the size of the facility by up to $150 million, subject to certain conditions and availability of lender commitments. Borrowings under the Revolving Credit Facility bear interest at the Company’s election at a variable rate equal to (a) one, three or six month term SOFR (the forward-looking secured overnight financing rate) plus 0.10%, or (b) an alternate base rate, in each case plus an applicable margin. The applicable margin is between 1.00% and 1.75% per annum for term SOFR loans and between 0.00% and 0.75% per annum for alternate base rate loans, in each case based on the Company’s leverage ratio, as defined in the agreement. The Company also accrues fees based on the daily unused portion of the Revolving Credit Facility, which is between 0.0125% and 0.025% based on the Company’s consolidated net lease adjusted leverage ratio. Under the Revolving Credit Facility, the Company is subject to a maximum consolidated net lease adjusted leverage ratio of less than 3.50 to 1.00 with the potential to be temporarily increased in the event the Company makes an acquisition that meets certain criteria. The Revolving Credit Facility contains certain customary representations and warranties, affirmative and negative covenants and provisions relating to events of default. Under the Revolving Credit Facility, if an event of default occurs, the banks will be entitled to take various actions, including the acceleration of amounts due. The Company was in compliance with its debt covenants under the Revolving Credit Facility at September 30, 2024.

Previous wording

At June 30, 2024 the Company had outstanding borrowings of $67.0 million and outstanding letters of credit $32.2 million under this Revolving Credit Facility. As of December 31, 2023, the Company had no outstanding borrowings and outstanding letters of credit of $32.1 million under this Revolving Credit Facility. At June 30, 2024, the Company had $200.8 million in availability under the Revolving Credit Facility.

Current wording

At September 30, 2024 the Company had outstanding borrowings of $83.0 million and outstanding letters of credit $32.2 million under the Revolving Credit Facility. As of December 31, 2023, the Company had no outstanding borrowings and outstanding letters of credit of $32.1 million under the Revolving Credit Facility. At September 30, 2024, the Company had $184.8 million in availability under the Revolving Credit Facility.

Previous wording

The Shelf Agreement requires that the Company maintain a consolidated net lease adjusted leverage ratio of less than 3.50 to 1.00, with limited exceptions. The Shelf Agreement also contains certain customary representations and warranties, affirmative and negative covenants and provisions related to events of default. Upon the occurrence and continuance of an event of default, the holders of notes issued under the Shelf Agreement may require immediate payment of all amounts owing under such notes. The Company was in compliance with its debt covenants at June 30, 2024.

Current wording

The Shelf Agreement requires that the Company maintain a consolidated net lease adjusted leverage ratio of less than 3.50 to 1.00, with limited exceptions. The Shelf Agreement also contains certain customary representations and warranties, affirmative and negative covenants and provisions related to events of default. Upon the occurrence and continuance of an event of default, the holders of notes issued under the Shelf Agreement may require immediate payment of all amounts owing under such notes. The Company was in compliance with its debt covenants under the Shelf Agreement at September 30, 2024.

Previous wording

At June 30, 2024 and December 31, 2023, the Company had outstanding borrowings under this Shelf Agreement of $100.0 million and $0, respectively.

Current wording

At September 30, 2024 and December 31, 2023, the Company had outstanding borrowings under the Shelf Agreement of $100.0 million and $0, respectively.

Previous wording

The Company is obligated under finance leases with seven-year original terms covering certain revenue equipment. Total liabilities recognized under the finance leases were $9.7 million and $16.5 million as of June 30, 2024 and December 31, 2023, respectively. Amortization of assets held under the finance leases is included in depreciation and amortization expense. The weighted average interest rates for the finance leases at June 30, 2024 and December 31, 2023 were 4.1 percent and 4.0 percent, respectively.

Current wording

The Company is obligated under finance leases with seven-year original terms covering certain revenue equipment. Total liabilities recognized under the finance leases were $8.0 million and $16.5 million as of September 30, 2024 and December 31, 2023, respectively. Amortization of assets held under the finance leases is included in depreciation and amortization expense. The weighted average interest rates for the finance leases at September 30, 2024 and December 31, 2023 were 4.1 percent and 4.0 percent, respectively.

Previous wording

Contractual obligations for the Company are comprised of lease agreements, purchase obligations and long-term debt obligations. Contractual obligations for operating leases at June 30, 2024 totaled $147.6 million, including operating leases with original maturities of less than one year, which are not recorded in our consolidated balance sheet in accordance with U.S. generally accepted accounting principles. Contractual obligations in the form of finance leases were $10.0 million at June 30, 2024, which includes both principal and interest amounts. For the remainder of 2024, $7.0 million of interest payments are anticipated based on borrowings and commitments outstanding at June 30, 2024. See Note 5 to the accompanying unaudited condensed consolidated financial statements in this Current Report on Form 10-Q. Purchase obligations at June 30, 2024 were $153.0 million, including commitments of $152.8 million for capital expenditures. As of June 30, 2024, the Revolving Credit Facility had $67.0 million outstanding principal balance and the Shelf Agreement had $100.0 million outstanding principal balance.

Current wording

Contractual obligations for the Company are comprised of lease agreements, purchase obligations and long-term debt obligations. Contractual obligations for operating leases at September 30, 2024 totaled $140.7 million, including operating leases with original maturities of less than one year, which are not recorded in our consolidated balance sheet in accordance with U.S. generally accepted accounting principles. Contractual obligations in the form of finance leases were $8.2 million at September 30, 2024, which includes both principal and interest amounts. For the remainder of 2024, $3.9 million of interest payments are anticipated based on borrowings and commitments outstanding at September 30, 2024. See Note 5, “Debt and Financing Arrangements,” of the accompanying unaudited condensed consolidated financial statements in this 10-Q. Purchase obligations at September 30, 2024 were $90.5 million, including commitments of $90.3 million for capital expenditures. As of September 30, 2024, the Revolving Credit Facility had $83.0 million outstanding principal balance and the Shelf Agreement had $100.0 million outstanding principal balance.

Previous wording

Other commercial commitments of the Company typically include letters of credit and surety bonds required for collateral towards insurance agreements. As of June 30, 2024 the Company had total outstanding letters of credit of $32.2 million and $59.6 million in surety bonds.

Current wording

Other commercial commitments of the Company typically include letters of credit and surety bonds required for collateral towards insurance agreements. As of September 30, 2024 the Company had total outstanding letters of credit of $32.2 million and $60.4 million in surety bonds.

Previous wording

The Company has accrued approximately $4.4 million for uncertain tax positions and $0.5 million for interest and penalties related to the uncertain tax positions as of June 30, 2024. At June 30, 2024, the Company has accrued $86.9 million for claims and insurance liabilities.

Current wording

The Company has accrued approximately $4.6 million for uncertain tax positions and $0.6 million for interest and penalties related to the uncertain tax positions as of September 30, 2024. At September 30, 2024, the Company has accrued $87.0 million for claims and insurance liabilities.