Proficient Auto Logistics, Inc

Previous wording

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION FOR THE THREE MONTHS ENDED MARCH 31, 2025

Current wording

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025

Previous wording

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and the related notes of Proficient and Proficient Transport included elsewhere in this Quarterly Report on Form 10-Q for the three months ended March 31, 2025 (the “Quarterly Report”) and the consolidated financial statements and related notes of Proficient and Proficient Transport for the year ended December 31, 2024 included in Proficient’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31, 2025 (the “Annual Report”).

Current wording

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and the related notes of Proficient and Proficient Transport included elsewhere in this Quarterly Report on Form 10-Q for the three and six months ended June 30, 2025 (the “Quarterly Report”) and the consolidated financial statements and related notes of Proficient and Proficient Transport for the year ended December 31, 2024 included in Proficient’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31, 2025 (the “Annual Report”).

Previous wording

We are a leading specialized freight company focused on providing auto transportation and logistics services. Formed in connection with the IPO through the combination of five industry-leading operating companies, we operate one of the largest auto transportation fleets in North America based upon information obtained from leadership of the Auto Haulers Association of America, utilizing roughly 1,250 auto transport vehicles and trailers on a daily basis, including approximately 831 Company-owned transport vehicles and trailers, and employing 730 dedicated employees as of March 31, 2025. From our 50 strategically located facilities across the United States, we offer a broad range of auto transportation and logistics services, primarily focused on transporting finished vehicles from automotive production facilities, marine ports of entry or regional rail yards to auto dealerships around the country. We have developed a differentiated business model due to our scale, breadth of geographic coverage and embedded customer relationships with leading auto original equipment manufacturing companies (“OEMs”). Our customers include nearly all of the global auto manufacturing companies. Additional customers include auto dealers, auto auctions, rental car companies and auto leasing companies.

Current wording

We are a leading specialized freight company focused on providing auto transportation and logistics services. Formed in connection with the IPO through the combination of five industry-leading operating companies, we operate one of the largest auto transportation fleets in North America based upon information obtained from leadership of the Auto Haulers Association of America, utilizing roughly 1,350 auto transport vehicles and trailers on a daily basis, including approximately 920 Company-owned transport vehicles and trailers, and employing 785 dedicated employees as of June 30, 2025. From our 57 strategically located facilities across the United States, we offer a broad range of auto transportation and logistics services, primarily focused on transporting finished vehicles from automotive production facilities, marine ports of entry or regional rail yards to auto dealerships around the country. We have developed a differentiated business model due to our scale, breadth of geographic coverage and embedded customer relationships with leading auto original equipment manufacturing companies (“OEMs”). Our customers include nearly all of the global auto manufacturing companies. Additional customers include auto dealers, auto auctions, rental car companies and auto leasing companies.

Previous wording

On December 21, 2023, Proficient Auto Logistics, Inc. entered into agreements to acquire in multiple, separate acquisitions five operating businesses and their respective affiliated entities, as applicable: (i) Delta, (ii) Deluxe, (iii) Sierra, (iv) Proficient Transport, and (v) Tribeca. On May 13, 2024, the Company completed its IPO of its common stock, and in connection with the closing of the IPO, the Company also completed the acquisitions of all of the Founding Companies. The Founding Companies were acquired for approximately $178.5 million in cash and 6,978,191 shares of our common stock (provided, that 541,866 of these shares of common stock were held back and were not be issued at the closing of the Combinations to satisfy the indemnification obligations of certain of the Founding Companies for a period of twelve months following the closing of the Company’s IPO). Thereafter, on August 16, 2024, the Company acquired ATG for approximately $28.9 million in cash and 1,069,346 shares of our common stock. Subsequently on November 1, 2024, the Company acquired Utah Truck & Trailer Repair, LLC, (“UTT”), a repair facility located at the ATG headquarters terminal in Ogden, Utah for $4.5 million in cash. These acquisitions expanded the Company’s geographic presence and services offered. The Combinations and subsequent acquisitions are accounted for as business combinations under ASC 805. Under this method of accounting, Proficient Auto Logistics, Inc. is treated as the “accounting acquirer.”

Current wording

On December 21, 2023, Proficient Auto Logistics, Inc. entered into agreements to acquire in multiple, separate acquisitions five operating businesses and their respective affiliated entities, as applicable: (i) Delta, (ii) Deluxe, (iii) Sierra, (iv) Proficient Transport, and (v) Tribeca. On May 13, 2024, the Company completed its IPO of its common stock, and in connection with the closing of the IPO, the Company also completed the acquisitions of all of the Founding Companies. Thereafter, on August 16, 2024, the Company acquired Auto Transport Group, LC, (“ATG”), then on November 1, 2024, the Company acquired Utah Truck & Trailer Repair, LLC, (“UTT”), a repair facility located at the ATG headquarters terminal in Ogden, Utah. On April 1, 2025, the Company acquired Brothers Auto Transport, LLC, (“Brothers”), located in Wind Gap, Pennsylvania and on May 27, 2025, the Company acquired PVT Truck & Trailer Repair, LLC, (“PVT”) a repair facility located at the Brothers headquarters. These acquisitions expanded the Company’s geographic presence and services offered. The Combinations and subsequent acquisitions are accounted for as business combinations under ASC 805. Under this method of accounting, Proficient Auto Logistics, Inc. is treated as the “accounting acquirer”.

Previous wording

Proficient Auto Logistics, Inc. has been identified as the designated accounting acquirer (“Successor”) of each of the Founding Companies and Proficient Transport has been identified as the designated accounting predecessor (“Predecessor”) to the Company. As a result, Management’s Discussion And Analysis Of Results Of Operations And Financial Condition For The Three Months Ended March 31, 2025 and March 31, 2024 for each of Proficient and Proficient Transport are included in this Quarterly Report on Form 10-Q. A black-line between the Successor and Predecessor periods has been placed in the financial tables below to highlight the lack of comparability between these two periods. Please refer to Note 3, “Business Combinations.”

Current wording

Proficient Auto Logistics, Inc. has been identified as the designated accounting acquirer (“Successor”) of each of the Founding Companies and Proficient Transport has been identified as the designated accounting predecessor (“Predecessor”) to the Company. As a result, Management’s Discussion And Analysis Of Results Of Operations And Financial Condition For The Three and Six Months Ended June 30, 2025 and June 30, 2024 for each of Proficient and Proficient Transport are included in this Quarterly Report on Form 10-Q. A black-line between the Successor and Predecessor periods has been placed in the financial tables below to highlight the lack of comparability between these two periods. Please refer to Note 3, “Business Combinations”.

Previous wording

Generally, we receive fuel surcharges on the miles moved for which we are compensated by customers. Fuel surcharges revenue mitigates the effect of price increases over a negotiated base rate per gallon of fuel; however, these revenues may not fully protect us from all fuel price increases.

Current wording

Generally, we receive fuel surcharges on the miles moved for which we are compensated by customers. Fuel surcharge revenue mitigates the effect of price increases over a negotiated base rate per gallon of fuel; however, these revenues may not fully protect us from all fuel price increases.

Previous wording

Our most significant operating expenses vary with miles traveled and include (i) fuel and fuel taxes, (ii) driver related expenses, such as salaries, wages, benefits, training and recruitment, (iii) the cost of purchased transportation that we pay to third-party carriers and (iv) maintenance of our fleet. Expenses that have both fixed and variable components include maintenance and tire expense and our total cost of insurance and claims. These expenses generally vary with the miles we travel, but also have a controllable component based on safety, fleet age, efficiency and other factors. Our main fixed costs include depreciation of long-term assets, such as revenue equipment and service center facilities, the compensation of non-driver personnel and other general and administrative expenses.

Current wording

The most significant operating expenses vary with miles traveled and include (i) fuel and fuel taxes, (ii) driver related expenses, such as salaries, wages, benefits, training and recruitment, (iii) the cost of purchased transportation that we pay to third-party carriers and (iv) maintenance of our fleet. Expenses that have both fixed and variable components include maintenance and tire expense and our total cost of insurance and claims. These expenses generally vary with the miles traveled, but also have a controllable component based on safety, fleet age, efficiency and other factors. The main fixed costs include depreciation of long-term assets, such as revenue equipment and service center facilities, the compensation of non-driver personnel and other general and administrative expenses.

Previous wording

Property and equipment are carried at cost. Depreciation of property and equipment is computed using the straight-line method for financial reporting purposes and accelerated methods for tax purposes over the estimated useful lives of the related assets (net of estimated salvage value or trade-in value). We generally use estimated useful lives of five to ten years for trucks and trailers, classified as transportation equipment. The depreciable lives of our revenue equipment represent the estimated usage period of the equipment, which may be less than the economic lives.

Current wording

Property and equipment are carried at cost. Depreciation of property and equipment is computed using the straight-line method for financial reporting purposes and accelerated methods for tax purposes over the estimated useful lives of the related assets (net of estimated salvage value or trade-in value). We generally use estimated useful lives of five to ten years for trucks and trailers, classified as transportation equipment. The depreciable lives of revenue equipment represent the estimated usage period of the equipment, which may be less than the economic lives.

Previous wording

Business Combinations— The Company accounts for business combinations using the acquisition method pursuant to ASC 805, Business Combinations. For each acquisition, the Company recognizes the assets acquired and liabilities assumed at their respective fair values as of the acquisition date. Valuations of certain assets acquired, including customer relationships, developed technology and trade names involve significant judgment and estimation. The Company uses independent valuation specialists to help determine fair value of certain assets and liabilities. Valuations utilize significant estimates, such as forecasted revenues and profits. Changes in these estimates could significantly impact on the value of certain assets and liabilities. ASC 805 establishes a measurement period to provide the Company with a reasonable amount of time to obtain the information necessary to identify and measure various items in a business combination and cannot extend beyond one year from the acquisition date. Measurement period adjustments are recognized in the reporting period in which the adjustments are determined and calculated as if the accounting had been completed as of the acquisition date. The Company expects to complete the final fair value determination of the assets acquired and liabilities assumed as soon as practicable within the measurement period, but not to exceed one year from the acquisition date.

Current wording

Business Combinations— The Company accounts for business combinations using the acquisition method pursuant to ASC 805, Business Combinations. For each acquisition, the Company recognizes the assets acquired and liabilities assumed at their respective fair values as of the acquisition date. Valuations of certain assets acquired, including customer relationships, developed technology and trade names involve significant judgment and estimation. The Company uses independent valuation specialists to help determine fair value of certain assets and liabilities. Valuations utilize significant estimates, such as forecasted revenues and profits. Changes in these estimates could significantly impact the value of certain assets and liabilities. ASC 805 establishes a measurement period to provide the Company with a reasonable amount of time to obtain the information necessary to identify and measure various items in a business combination and cannot extend beyond one year from the acquisition date. Measurement period adjustments are recognized in the reporting period in which the adjustments are determined and calculated as if the accounting had been completed as of the acquisition date. The Company completes the final fair value determination of the assets acquired and liabilities assumed for each acquired business as soon as practicable within the measurement period, but not to exceed one year from the acquisition date.

Previous wording

We are typically paid a predetermined rate per unit for our Company Drivers services. Our executed contracts contain fixed terms and rates and are often used by our customers with high-service and high-priority freight. We continually strive to increase our revenues derived from contracts as a percentage of total revenue by continuing to build upon our existing relations and acquire new relations with OEMs.

Current wording

We are typically paid a predetermined rate per unit for our Company Drivers services. Our executed contracts contain fixed terms and rates and are often used by our customers with high-service and high-priority freight. We continually strive to increase our revenues derived from contracts by continuing to build upon our existing relations and acquire new relations with OEMs.

Previous wording

Our contracts with customers in the Company Drivers segment generally include a fuel surcharge to account for fluctuating fuel prices. Built into our predetermined contract rates with each customer is a baseline fuel price and when fuel prices rise above this baseline price our customers compensate us for the variance in the form of additional revenue. If fuel prices drop below the baseline price, we may in turn owe our customers this variance and record a discount. This additional revenue/discount is represented on the Fuel Surcharge and Other Reimbursements line in our condensed consolidated financial statements.

Current wording

Our contracts with customers in the Company Drivers segment generally include a fuel surcharge to account for fluctuating fuel prices. Built into our predetermined contract rates with each customer is a baseline fuel price and when fuel prices rise above this baseline price, our customers compensate us for the variance in the form of additional revenue. If fuel prices drop below the baseline price, we may in turn owe our customers this variance and record a discount. This additional revenue/discount is represented on the Fuel Surcharge and Other Reimbursements line in the condensed consolidated financial statements.

Previous wording

Our Company Drivers segment requires substantial capital expenditures for purchase of new revenue equipment. We use a combination of financing leases and secured long-term debt to acquire revenue equipment. When we finance revenue equipment acquisitions with either finance leases or long-term debt, the asset and liability are recorded on our consolidated balance sheet, and we record expense under “Depreciation” and “Interest expense.” We expect our depreciation and interest expense will be impacted by changes in the percentage of our revenue equipment acquired in any given year

Current wording

Our Company Drivers segment requires substantial capital expenditures for the purchase of new revenue equipment. We use a combination of financing leases and secured long-term debt to acquire revenue equipment. When we finance revenue equipment acquisitions with either finance leases or long-term debt, the asset and liability are recorded on our consolidated balance sheet, and we record expense under “Depreciation” and “Interest expense”. We expect our depreciation and interest expense will be impacted by changes in the percentage of our revenue equipment acquired in any given year.

Previous wording

In our Subhaulers Segment, we generate revenue by utilizing our independent owner operators (who run under our DOT authority) and independent third-party carriers to assist in transporting autos for our customers in our OEM contract and spot arrangements, and secondary market auto moves. We maintain the customer relationship, including billing and collection, but outsource the transportation of the loads. The main factors that affect operating revenue in our Subhaulers segment are our customers’ excess inventory needs, the rates we obtain from customers, the auto volumes we ship through the subhaulers segment and our ability to secure these carriers.

Current wording

In our Subhaulers Segment, we generate revenue by independent owner operators (who run under our DOT authority) and independent third-party carriers to assist in transporting autos for customers in our OEM contract and spot arrangements, and secondary market auto moves. We maintain the customer relationship, including billing and collection, but outsource the transportation of the loads. The main factors that affect operating revenue in our Subhaulers segment are our customers’ excess inventory needs, the rates we obtain from customers, the auto volumes we ship through the subhaulers segment and our ability to secure capacity using independent carriers.

Previous wording

We report our financial results in accordance with accounting principles GAAP. However, management believes that EBITDA and Operating Ratio provide useful information in measuring our operating performance, generating future operating plans and making strategic decisions regarding allocation of capital. Management believes this information presents helpful comparisons of financial performance between periods by excluding the effect of certain non-recurring items.

Current wording

We report our financial results in accordance with generally accepted accounting principles (“GAAP”). However, management believes that certain non-GAAP measures, including EBITDA and Operating Ratio, provide useful information in measuring operating performance, generating future operating plans and making strategic decisions regarding allocation of capital. Management believes this information presents helpful comparisons of financial performance between periods by excluding the effect of certain non-recurring items.

Previous wording

Results of Operations for the three months ended March 31, 2025 (Successor) and 2024 (Predecessor)

Current wording

Results of Operations for the three months ended June 30, 2025 and June 30, 2024 (Predecessor) and period ended April 1 to May 12, 2024 (Successor)

Previous wording

Successor financial information presented below includes results for the three months ended March 31, 2025. We have excluded the Successor financial information for the three months ended March 31, 2024 as it only includes immaterial expenses incurred prior to the IPO. The Predecessor financial information presented below shows only the results of operations for Proficient Auto Transport for the three months ended March 31, 2024. The following discussion takes into consideration the lack of comparability. See Note 3 —Business Combinations for more information.

Current wording

Successor financial information presented below includes results for the three months ended June 30, 2025. We have excluded the Successor financial information for the three months ended June 30, 2024 as it only includes immaterial expenses incurred prior to the IPO and only a partial quarter of the acquired entities for comparability. The Predecessor financial information presented below shows only the results of operations for Proficient Transport for the period ended April 1, to May 12, 2024. The following discussion takes into consideration the lack of comparability. See Note 3 —Business Combinations for more information.

Previous wording

Operating Revenue — The Company generates revenue from two primary sources: transporting freight for customers, including related fuel surcharge revenue and other reimbursements (Company Drivers), and arranging for the transportation of customer freight by third-party carriers (Subhauled). Company Drivers revenue, before fuel surcharges and other reimbursements, is primarily generated through trucking services provided by the Company’s service offerings to OEMs and the secondary market. Subhauler revenue before fuel surcharges and other reimbursements is primarily generated through dispatching and brokering freight to third-party carriers. Fuel surcharges and other reimbursements represent additional revenue the Company earns based on mileage driven and other reimbursable costs incurred for which it is compensated by its customers.

Current wording

Operating Revenue — The Company generates revenue from two primary sources: transporting freight for customers, including related fuel surcharge revenue and other reimbursements (Company Drivers), and arranging for the transportation of customer freight by third-party carriers (Subhaulers). Company Drivers segment revenue, before fuel surcharges and other reimbursements, is primarily generated through trucking services provided by the Company’s service offerings to OEMs and the secondary market. Subhaulers segment revenue before fuel surcharges and other reimbursements is primarily generated through dispatching and brokering freight to third-party carriers. Fuel surcharges and other reimbursements represent additional revenue the Company earns based on mileage driven and other reimbursable costs incurred for which it is compensated by its customers.

Previous wording

In the Company Driver segment, operating revenues increased by $28.1 million, or 609.6%, to $32.7 million in 2025 compared to $4.6 million in 2024. The increase in the Company Driver segment’s revenue was driven by the Successor period including revenue from the acquired entities.

Current wording

In the Company Driver segment, operating revenues increased by $38.5 million, or 1,298%, to $41.5 million in the three months ended June 30, 2025 compared to $3.0 million for the period April 1 to May 12, 2024. The increase in the Company Drivers segment’s revenue was driven by the Successor period including revenue from the acquired entities and the Predecessor period is only for half of the quarter.

Previous wording

Stock-based compensation increased to $1.2 million in 2025 compared to $0 in 2024. The increase is due to the result of stock-based compensation being offered following the Company’s IPO during 2024.

Current wording

Stock-based compensation increased to $1.2 million in the three months ended June 30, 2025 compared to $0 for the period April 1 to May 12, 2024. The increase is due to the result of stock-based compensation being offered following the Company’s IPO during 2024.

Previous wording

Depreciation and amortization and the loss (gain) on sale of equipment increased by $6.1 million, or 1507%, to $6.5 million in 2025 compared to $0.4 million in 2024. The increase in depreciation and amortization and the loss (gain) on sale of equipment was driven by the Successor period including expenses from the acquired entities.

Current wording

Depreciation and amortization and the loss (gain) on sale of equipment increased by $7.1 million, or 2407%, to $7.4 million in the three months ended June 30, 2025 compared to $296,000 for the period April 1 to May 12, 2024. The increase in depreciation and amortization and the loss (gain) on sale of equipment was driven by the Successor period including expenses from the acquired entities.

Previous wording

Intangible amortization increased $2.4 million in 2025 compared to $0 in 2024. This is due to the Predecessor not having any intangible assets.

Current wording

Intangible amortization increased $2.5 million in the three months ended June 30, 2025 compared to $0 for the period April 1 to May 12, 2024. This is due to the Predecessor not having any intangible assets.

Previous wording

General, selling, and other operating expenses — General, selling, and other operating expenses consist primarily of legal and professional services fees, occupancy and other costs. General, selling, and other operating expenses increased by $3.1 million, or 330%, to $4.1 million in 2025 compared to $0.9 million in 2024. The increase in general, selling, and other operating expenses was primarily due to the Successor period includes expenses from the acquired entities.

Current wording

General, selling, and other operating expenses — General, selling, and other operating expenses consist primarily of legal and professional services fees, occupancy and other costs. General, selling, and other operating expenses increased by $1.3 million, or 45%, to $4.3 million in the three months ended June 30, 2025 compared to $3.0 million for the period April 1 to May 12, 2024. The increase in general, selling, and other operating expenses was primarily due to the Successor period including expenses from the acquired entities.

Previous wording

Interest expense, net — Interest expense, net consists of cash interest, amortization of deferred financing fees, net of any interest income received from financial institutions. Interest expense, net increased by $1.1 million, or 247%, to $1.6 million in 2025 compared to $0.5 million in 2024. The increase was primarily due to the Successor period includes interest expense from the acquired entities.

Current wording

Interest expense, net — Interest expense, net consists of cash interest, amortization of deferred financing fees, net of any interest income received from financial institutions. Interest expense, net increased by $1.6 million, or 593%, to $1.8 million in the three months ended June 30, 2025 compared to $265,000 million for the period April 1 to May 12, 2024. The increase was primarily due to the Successor period including interest expense from the acquired entities.

Previous wording

Operating ratio — Operating ratio is calculated as total operating expenses as a percentage of operating revenue. The Company’s operating ratio increased by 9.7% to 102.4% in 2025 as compared to 92.7% in 2024. The increase in costs was primarily due to expenses that the Predecessor did not incur, including stock compensation expense ($1.1 million) and intangible amortization expense ($2.4 million). Excluding these expenses, the operating ratio for 2024 would be 98.7%. We are working to achieve synergies across all operating companies, which should help reduce the operating ratio over time. See “Non-GAAP Financial Measure” section for the Company’s calculation of operating ratio.

Current wording

Operating ratio — Operating ratio is calculated as total operating expenses as a percentage of operating revenue. The Company’s operating ratio decreased by 100.5% to 99.9% in the three months ended June 30, 2025 as compared to 272.1% for the period April 1 to May 12, 2024. The decrease in operating ratio is primarily due to the Predecessor’s salaries expense including bonuses paid by the seller in connection with the IPO. Excluding successor stock-based compensation and intangible amortization expense, the adjusted operating ratio for the three months ended June 30, 2025 is 96.7%. We are working to achieve synergies across all operating companies, which should reduce the operating ratio over time. See “Non-GAAP Financial Measure” section for the Company’s calculation of operating ratio and adjusted operating ratio.

Previous wording

EBITDA — EBITDA increased by $3.9 million, or 147%, to $6.6 million in 2025 compared to $2.7 million in 2024. The increase was due to the Successor period having more revenue from the acquired entities. See “Non-GAAP Financial Measure” section for the Company’s calculation of EBITDA.

Current wording

EBITDA — EBITDA increased by $32.8 million, or 144.2%, to $10.1 million in the three months ended June 30, 2025 compared to $(22.8) million for the period April 1 to May 12, 2024. The increase was due to the Successor period having more revenue from the acquired entities and the predecessor period including bonuses paid by the seller in connection with the IPO. See “Non-GAAP Financial Measure” section for the Company’s calculation of EBITDA.

Previous wording

Adjusted EBITDA — Adjusted EBITDA represents net income (loss) plus interest expense, income tax expense (benefit), depreciation expense, intangible amortization expense, and share-based compensation expenses. Adjusted EBITDA increased by $5.1 million, or 191%, to $7.8 million in 2025 compared to $2.7 million in 2024. The increase was primarily due to higher EBITDA described above. See “Non-GAAP Financial Measure” section for the Company’s calculation of Adjusted EBITDA.

Current wording

Adjusted EBITDA — Adjusted EBITDA represents net income (loss) plus interest expense, income tax expense (benefit), depreciation expense, intangible amortization expense, and share-based compensation expenses. Adjusted EBITDA increased by $34.0 million, or 149.5%, to $11.3 million in the second quarter of 2025 compared to $(22.8) million for the period April 1 to May 12, 2024. The increase was due to the Successor period having more revenue from the acquired entities and the predecessor period including bonuses paid by the seller in connection with the IPO. See “Non-GAAP Financial Measure” section for the Company’s calculation of Adjusted EBITDA.

Previous wording

In the Subhaulers segment, operating revenues increased by $67.4 million, or 242.1%, to $95.2 million in 2025 compared to $27.8 million in 2024. The increase in the Subhaulers segment’s revenue was driven by the Successor period including revenue from the acquired entities.

Current wording

In the Subhaulers segment, operating revenues increased by $103.0 million, or 306%, to $136.6 million in the six months ended June 30, 2025 compared to $33.6 million for the period January 1 to May 12, 2024. The increase in the Subhaulers segment’s revenue was driven by the Successor period including revenue from the acquired entities.

Previous wording

Fuel and fuel taxes increased by $5.3 million, or 695%, to $6.1 million in 2025 compared to $0.8 million in 2024. The increase in fuel and fuel taxes was driven primarily by the Successor period including expenses from the acquired entities.

Current wording

Fuel and fuel taxes increased by $11.7 million, or 1047%, to $12.8 million in the six months ended June 30, 2025 compared to $1.1 million for the period January 1 to May 12, 2024. The increase in fuel and fuel taxes was driven primarily by the Successor period including expenses from the acquired entities.

Previous wording

Purchased transportation increased by $29.7 million, or 170%, to $47.2 million in 2025 compared to $17.5 million in 2024. The increase in purchased transportation was driven by the Successor period includes expenses from the acquired entities, as well as the expansion of our subhauler network, revenue from new contracts and spot buy opportunities.

Current wording

Purchased transportation increased by $80.2 million, or 308%, to $106.2 million in the six months ended June 30, 2025 compared to $26.0 million for the period January 1 to May 12, 2024. The increase in purchased transportation was driven by the Successor period, which includes expenses from the acquired entities, as well as the expansion of the subhauler network, revenue from new contracts and spot buy opportunities.

Previous wording

Truck expenses and supplies are primarily affected by the age of the Company’s company-owned and leased fleet of trucks and trailers, the number of miles driven in a period and driver turnover. Truck expenses increased 425% to $5.8 million in 2025 compared to $1.1 million in 2024. This is primarily due to the Successor period including expenses from the acquired entities.

Current wording

Truck expenses and supplies are primarily affected by the age of the Company’s company-owned and leased fleet of trucks and trailers, the number of miles driven in a period and driver turnover. Truck expenses increased 551% to $12.3 million in the six months ended June 30, 2025 compared to $1.9 million for the period January 1 to May 12, 2024. This is primarily due to the Successor period including expenses from the acquired entities.

Previous wording

Insurance premiums and claims increased by $4.4 million, or 738%, to $5.0 million in 2025 compared to $0.6 million in 2024. The increase in insurance premiums and claims was driven by the Successor period includes expenses from the acquired entities. We are working toward consolidating our insurance plans into a single policy, which will benefit the company by not only providing cost savings relative to similar coverage levels spread across numerous carriers, but also simplifying administration, streamlining the claims process, and ensuring better coverage consistency.

Current wording

Insurance premiums and claims increased by $9.2 million, or 834%, to $10.3 million in the six months ended June 30, 2025 compared to $1.1 million for the period January 1 to May 12, 2024. The increase in insurance premiums and claims was driven by the Successor period including expenses from the acquired entities. Subsequent to the end of the second quarter, we consolidated our casualty and workers’ compensation insurance plans into a single policy, which will benefit the company by not only providing cost savings relative to similar coverage levels spread across numerous carriers, but also simplifying administration, streamlining the claims process, and ensuring better coverage consistency.

Previous wording

The Loan Agreement contains customary affirmative and negative covenants, including covenants that restrict the ability of the Company and its subsidiaries to, among other things, incur debt, grant liens on their respective assets, engage in mergers and other fundamental changes, make investments, enter into transactions with affiliates, pay dividends and make other restricted payments, prepay other indebtedness and sell assets, in each case subject to certain exceptions set forth in the Loan Agreement. The Loan Agreement also requires the Company to maintain (i) a Fixed Charge Coverage Ratio (as defined in the Loan Agreement) of greater than or equal to 1.25 to 1.00 and (ii) a Funded Debt to Adjusted EBITDA Ratio (as defined in the Loan Agreement) of less than or equal to 3.00 to 1.00, in each case, as of the end of each fiscal quarter, commencing with the fiscal quarter ending March 31, 2025. The Company was in compliance with its debt covenants as of March 31, 2025.

Current wording

The Loan Agreement contains customary affirmative and negative covenants, including covenants that restrict the ability of the Company and its subsidiaries to, among other things, incur debt, grant liens on their respective assets, engage in mergers and other fundamental changes, make investments, enter into transactions with affiliates, pay dividends and make other restricted payments, prepay other indebtedness and sell assets, in each case subject to certain exceptions set forth in the Loan Agreement. The Loan Agreement also requires the Company to maintain (i) a Fixed Charge Coverage Ratio (as defined in the Loan Agreement) of greater than or equal to 1.25 to 1.00 and (ii) a Funded Debt to Adjusted EBITDA Ratio (as defined in the Loan Agreement) of less than or equal to 3.00 to 1.00, in each case, as of the end of each fiscal quarter. The Company was in compliance with its debt covenants as of June 30, 2025.

Previous wording

Upon closing, the Company drew $16.0 million from the available term debt, a portion of which was used to repay and terminate the Proficient Transport line of credit. As of March 31, 2025, there was $15.9 million outstanding under the Loan Agreement.

Current wording

Upon closing, the Company drew $16.0 million from the available term debt, a portion of which was used to repay and terminate the Proficient Transport line of credit. On April 1, 2025, the Company drew $9.0 million to fund the cash portion of the Brothers Auto Transport, LLC acquisition. As of June 30, 2025, there was $24.5 million outstanding under the Loan Agreement.

Previous wording

For the three months ended March 31, 2025 (Successor), cash flows used in investing activities was $2.4 million. This increase of $2.4 million compared to March 31, 2024 (Predecessor) is mainly due to the cash paid to purchase new equipment.

Current wording

For the six months ended June 30, 2025 (Successor), cash flows used in investing activities were $11.1 million. This decrease of $11.1 million compared to the period ended January 1 to May 12, 2024 (Predecessor) is mainly due to the cash paid to purchase new equipment and the acquisition of Brothers and PVT Truck and Trailer.

Previous wording

For the three months ended March 31, 2025 (Successor), cash flows used in financing activities was $3.7 million, which was a decrease of $224,000 compared to the three months ended March 31, 2024 (Predecessor).

Current wording

For the six months ended June 30, 2025 (Successor), cash flows used in financing activities were $3.9 million, which was an increase of $1.7 million compared to the period ended January 1 to May 12, 2024 (Predecessor).