67 WALL STREET, New York - October 8, 2013 - The Wall Street Transcript has just published its Transportation and Logistics Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Regulatory Issues in the Trucking Industry - Trucking Pricing & Capacity Dynamics - Truckload, LTL, Parcel, Rail and Intermodal - Technology Adoption and Infrastructure Investments
Companies include: Roadrunner Transportation Systems, Inc. (RRTS) and many more.
In the following excerpt from the Transportation and Logistics Report, the President, CEO and Director of Roadrunner Transportation Systems, Inc. (RRTS) discusses company strategy and the outlook for this vital industry:
TWST: As you mentioned, you were recently named one of the Fortune 100's Fastest-Growing Companies. How strong financially is Roadrunner at this point? As you review your balance sheet and P&L, are there any areas you are focused on for improvement?
Mr. DiBlasi: Obviously we've continued to build out the business; we are a high-growth company in an industry that doesn't have a lot of high-growth companies. Transportation has been around for hundreds of years in the United States and throughout the world. In recent years, you haven't seen a lot of companies experiencing the type of growth that we have, and we feel like we have the right formula in place to grow and expand.
Financially we are very sound; we do carry some debt, but we don't allow that debt to exceed two times our trailing EBITDA, which is very conservative. We've done two equity offerings since the IPO in 2010 to raise funds, to give us plenty of dry powder for future acquisitions. Currently we have about $170 million in available funds for acquisitions that will carry us through probably the next year or year and a half, so we'll have to do something else to raise funds. But as we grow, one of my criteria is to add profitable businesses. Once we do add those profitable businesses, we generate a significant amount of free cash flow because of our business model. So this cash flow, in conjunction with the funds that we have available to us, gives us a significant amount of dry powder going forward. We think that we can continue to grow this company through a very aggressive growth strategy and in a very profitable way as well. Over the course of the last five years, we've improved our profitability every year, in addition to the significant revenue growth that we've experienced. We think that speaks very well for our business model.
TWST: Can you give us an idea of the size and growth potential of your markets or of the industry?
Mr. DiBlasi: The industry itself is huge; it's a $400 billion industry that is very fragmented. The largest truckload provider out there does $3 billion to $4 billion in revenues in a $400 billion market - that's in truckload. LTL is about a $40 billion market. We focus on long-haul LTL, and that's about a $10 billion market. So from our perspective, there is significant upside for our continued growth.
As I said earlier, we would expect to come in somewhere between $1.4 billion and $1.5 billion in a $400 billion market for 2013, so there is a lot of opportunity for us to continue to expand and grow organically as well as through our acquisition strategy. And again, it is a very...
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