The North American LTL Marketplace @ YE2009

Select Views of the North American Less than Truckload
Freight Transportation Marketplace

Past & Present,

Including Its 10-Largest & Publicly-held LTL Service Providers.

Thom A. Williams, managing director

March 10, 2010

Certain Objects of Our Attention:

AmherstAlphaAdvisors LLC

LTL Shipment Volumes
The Top 10's
Total LTL Shipments
Of the top 10 publicly-held LTL carriers, 2006 thru 2009
120,000,000

FWRD, 2,318,897
VTNC, 4,040,306
FWRD, 2,325,556 FWRD, 2,295,299
VTNC, 3,007,985 TFI (est.), 3,688,367
VTNC, 3,930,049
100,000,000
TFI (est.), 3,330,182 ABFS, 5,393,652 TFI (est.), 4,159,831
ABFS, 5,690,505
ODFL, 6,765,000 ABFS, 5,017,807
FWRD, 2,095,223
ODFL, 6,428,000
ODFL, 6,691,000 VTNC, 3,705,152
SAIA, 6,888,000
SAIA, 6,177,000 TFI (est.), 3,739,055
SAIA, 6,710,000 ABFS, 4,396,293
80,000,000
UPS, 10,481,000
UPS, 9,638,000 ODFL, 5,750,000
UPS, 10,036,000
SAIA, 6,428,000
CNW, 15,264,882
CNW, 14,544,893
CNW, 14,854,580 UPS, 9,880,000
60,000,000

FDX, 17,085,000 FDX, 19,941,000 CNW, 14,809,233

FDX, 20,323,500
40,000,000

FDX, 18,972,000

YRCW, 40,117,000
YRCW, 38,646,000
20,000,000
YRCW, 33,848,000
YRCW, 23,515,000
During 2009, these top 10 LTL providers carried 15.8 million fewer shipments (-13.9%) than they did in 2006. YRCW's dramatic
41.4% volume decline (i.e., in '09 YRCW had 16.6 million fewer shipments than in '06) surely helped the others remain afloat!
0
2006 2007 2008 2009

YRCW FDX CNW UPS SAIA ODFL ABFS TFI (est.) VTNC FWRD
Fiscal YE May 31st for FDX; all others are YE Dec. 31.

AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K and AmherstAlpha data extrapolations..

LTL Shipments vs. Retail Import Cargo Container TEU Volumes
LTL Shipments, Import Cargo Container
in 000s TEU Volumes
17,000,000
40,000
16,000,000

15,000,000
35,000
14,000,000

13,000,000
30,000 While total LTL shipments carried by these top 10 declined ~14% from '06 thru
'09, the National Retail Federation reports that total containers shipped to major 12,000,000

U.S. retail container ports fell by ~23% during the same 3-year period.
11,000,000
25,000
NRF forecasts of container imports during 2010 change frequently, but still 10,000,000
anticipate increases beyond the YE '09 volumes. YRCW
9,000,000

20,000
8,000,000
FDX
7,000,000

15,000
6,000,000
CNW

5,000,000

10,000 4,000,000
UPS

3,000,000

SAIA
5,000 ODFL 2,000,000

ABFS
TFI (est.)
VTNC
1,000,000
FWRD
0 0
2006 2007 2008 2009
YRCW FDX CNW UPS SAIA ODFL ABFS TFI (est.) VTNC FWRD NFR-PortTracker
Fiscal YE May 31st for FDX; all others are YE Dec. 31. Retail TEUs

AmherstAlphaAdvisors LLC Source Data: SEC Forms 10-K.

LTL Revenues
LTL Revenues Of the top 10 publicly-held LTL carriers, 2006 thru 2009 Avg. On-road Diesel
US$s in thousands Price, US$s/gal.
$25,000,000
$3.807

FWRD, $336,200 $3.750
FWRD, $313,162 VTNC, $610,933
$22,500,000 VTNC, $584,786
TFI, $646,653
TFI, $533,847
FWRD, $299,600
VTNC, $441,499 SAIA, $976,123 SAIA, $1,030,421
TFI, $488,790
SAIA, $874,738 ODFL, $1,401,542 ODFL, $1,537,724
$20,000,000 $3.550
ODFL, $1,279,431
ABFS ABFS
$1,770,749 $1,758,780 FWRD, $268,245
ABFS VTNC, $519,215
$17,500,000 $1,810,328 TFI, $523,966
UPS UPS
SAIA, $849,141 $3.350
UPS $2,013,000 $2,062,000
$1,831,000 Fuel surcharge ODFL, $1,245,005
$15,000,000 increases
CNW CNW ABFS
considerably $2,904,543 $3,015,959 $1,384,419
CNW
$2,852,909
masked declining $3.150
shipments and UPS
$12,500,000 $1,943,000
otherwise dull
revenue growths.
FDX FDX CNW
FDX
$10,000,000 $3,645,000 $4,586,000 $2,574,300 $2.950
$4,934,000
$2.882

$7,500,000
FDX
$4,415,000 $2.750

$5,000,000 $2.705
YRCW YRCW
$8,446,149 $8,170,277 YRCW
$2.550
$7,659,677
$2,500,000 YRCW
CAUSE FOR CONCERN: Recent proliferations of LTL-focused rate-comparison, bidding-program and LTL- $4,751,462
consolidation software packages such as CzarLite, Bid$ense, DSi and others have quashed any pricing power
$2.467
leverages the LTL leaders held in earlier years!
$0 $2.350
2006 2007 2008 2009
YRCW FDX CNW UPS ABFS ODFL SAIA TFI VTNC FWRD Diesel
Fiscal YE May 31st for FDX; all others are YE Dec. 31. Avg.$/gal.


2006 LTL Carriers' Relative Marketshares
How the top 10 publicly-held LTL carriers divided US$22.7 billion of '06 LTL revenues:
UPS entered the LTL sector
with its August '05 cash
acquisition of Overnite Corp.
for ~$1.25 billion. Overnite ABFS ODFL
SAIA
reported $1.4 billion of LTL
$1,810,328 $1,279,431 2%
Revenue and $63 million net
UPS 8% 6%
$874,738
,7 90 2%
income @ YE2004. 4% 88 9
$1,831,000 $4 ,49 %
TF
I,
, $4
41 0 1
8% C 29 9,60
VTN D $
FWR

CNW
$2,852,909
13%

YRCW
$9,207,200
FDX 40%
$3,645,000
16%

On 5/24/2005, YRCW acquired USF Corp. for ~$1.3 billion, $835.4 million in cash and 9 million shares of
YRCW stock (valued at $51.62 per share). The USF acquisition increased YRCW's YE2005 revenue by
~$1.5 billion and YE2005 operating income by $59 million.

In a late 2003 display of acquisition hubris, YRCW paid ~$1.2 billion (~$1.08 bil. in cash and stock, plus
~$120 mil. in net debt) to buy Roadway Corp., which had YE2002 tangible net worth of $104 million and
And FDX acquired Watkins on 9/3/2006, for $787 2002 LTL revenues and net income of ~$2.8 billion and ~$35 million, respectively.
million cash. Earlier, Watkins reported $1.1
billion of calendar-year '05 LTL revenue; the
acquisition added ~$760 million to FDX's fiscal
YE05/31/07 LTL revenues.

YRCW FDX CNW UPS ABFS ODFL SAIA TFI VTNC FWRD


2009 LTL Carriers' Relative Marketshares
How the top 10 publicly-held LTL carriers divided US$18.4 billion of '09 LTL revenues:
TFI
ABFS recorded a $64 million $515,168 VTNC
goodwill-intangible asset
3% $519,215
impairment charge in '09. ODFL SAIA
3% FWRD
$1,245,005 $849,141
ABFS $268,245
7% 5%
$1,384,419 1%
7% During '08 Vitran wrote off
Saia booked $35.5 million of $107.4 million of LTL
goodwill-intangible asset write- acquisition-related goodwill-
UPS downs during '08, earlier intangible assets.
$1,943,000 established as the as result of
UPS recorded $584 three acquisitions.
million of write- 10%
downs to its Overnite
related goodwill- YRCW
intangible assets $4,811,917
during '08. 26%
CNW
$2,574,300
14%

In the three years following '06, YRCW recorded ~$1.8
FDX billion of goodwill-intangible asset impairment charges,
completely negating its USF and Roadway acquisition
$4,415,000
FDX recorded $90 million values. And,
of write-downs to its
24%
Watkins-related goodwill- Late in 2009 YRCW sold its only profitable operating
intangible assets during segment (Dedicated Fleet), to Greatwide Logistics for
'09. ~$34 million; YRCW later reported that segment had
revenue of ~$74 million and operating income of ~$7
million for YE2009.

YRCW FDX CNW UPS ABFS ODFL SAIA TFI VTNC FWRD


Revenue loss or gain,
Changes in LTL Revenues, YE 2009 vs. YE 2006
2009 vs. 2006,
US$s in millions

$750
FDX, +$770

$250
TFI (est.), +$35 VTNC, +$78

ODFL, -$34 FWRD, -$31 1 SAIA, -$26 UPS, -$24
CNW, -$279
($250)
ABFS, -$426

($750)

($1,250)

($1,750)

($2,250)

($2,750)

($3,250)

YRCW, -$3,695
($3,750)



LTL Revenue CAGRs, YE 2006 to YE 2009
LTL Revenues, Compounded Annual
Growth Rate (+ or -), YE '06 to YE '09
FDX
8.0% CAGR =
VTNC +6.6%
CAGR =
6.0% +5.6%

4.0% TFI (est.)
CAGR =
+2.3%
2.0%

0.0%

FWRD CNW
UPS
CAGR = CAGR = SAIA ODFL
-2.0% CAGR =
-3.6% -3.4% CAGR = CAGR =
-0.4%
-1.0% -0.9%
ABFS
-4.0%
CAGR =
-8.6%

-6.0%

-8.0% YRCW
CAGR =
-17.4%
-10.0% As the noted transport industry analysts John
Larkin and David Ross, of Stifel Nicolaus, recently
-12.0% asked:
"Which is the prettiest house in this ugly
-14.0% neighborhood?"

-16.0%

-18.0%
YRCW ABFS FWRD CNW SAIA ODFL UPS TFI (est.) VTNC FDX


LTL Operating Incomes
(after deductions for LTL-specific intangible asset and goodwill impairment charges)

LTL Operating
Profit or (Loss),
US$s in millions

$500

$300

VTNC, -$3
TFI (est.), $22

ODFL, $70

UPS, $77
CNW, $51
FWRD, $27
$100

SAIA, -$4
2006 2007 2008 2009

FDX, -$44
($100)

ABFS, -$169
($300)

($500)

($700)

($900)
YRCW
-$899

($1,100)

YRCW ABFS FDX SAIA VTNC TFI (est.) FWRD CNW ODFL UPS


LTL Operating Income per LTL Shipment
(after deductions for LTL-specific intangible asset and goodwill impairment charges)
LTL Operating Profit,
per LTL Shipment
US$s

$35.00

$30.00

$25.00

$20.00

ODFL FWRD
$15.00 $12.93
$12.24
UPS TFI
$10.00 $30.08 (est.)
CNW $5.98
$5.00 $3.46

$0.00
2006 2007 2008 SAIA 2009 SAIA VTNC
($5.00) ($1.47) FDX ($0.57) ($0.71)
($2.32)

($10.00)

($15.00)
YRCW
($14.62)
($20.00)

($25.00)
VTNC
($25.03)
($30.00)

YRCW
($35.00) ($31.73)

($40.00) YRCW ABFS
($38.23) ($38.37)
($45.00) UPS
($43.76)

YRCW FDX CNW UPS ABFS ODFL SAIA TFI (est.) VTNC FWRD


LTL Operating Income per LTL Shipment
(excluding deductions for LTL-specific intangible asset and goodwill impairment charges)
LTL Operating Profit
or (Loss) per
LTL Shipment, US$s

$34.00

$26.00

FWRD, $13.03
ODFL, $12.24
$18.00

UPS, $7.82
TFI (est.), $5.98
CNW, $3.46
$10.00

FDX, $2.42
$2.00

SAIA, ($0.57)
VTNC, ($0.71)
2006 2007 2008 2009
($6.00)

($14.00)

($22.00)

ABFS
($23.83)
($30.00)

($38.00) YRCW
($36.94)

YRCW ABFS VTNC SAIA FDX CNW TFI (est.) UPS ODFL FWRD


LTL Revenue per LTL Shipment

LTL Revenue per Avg. On-road
LTL Shipment, US$s Diesel, US$s/gal.

$4.000
$350.00
$3.807
$3.750

ABFS
$300.00 $3.500

$3.250

$250.00
$3.000

FDX
$2.882

ODFL
$2.750
$2.705
$200.00

YRCW
$2.500

UPS
$2.467

CNW
$150.00 $2.250

VTNC
TFI (est.)
SAIA

FWRD
$2.000

$100.00
FDX and ODFL each achieved an $1.750
approx. 9% total increase in avg.
revenue per shipment over the past
$1.500
$50.00
3 years; all others suffered declines.

$1.250

$0.00 $1.000
2006 2007 2008 2009

YRCW FDX CNW UPS ABFS ODFL SAIA TFI (est.) VTNC FWRD Diesel
Fiscal YE May 31st for FDX; all others are YE Dec. 31. Avg.$/gal.


Market Capitalization
@ 3/09/2009, US$s in millions Publicly-held North American LTL Carriers - Market Values on March 9, 2010

VTNC, $188

SAIA, $189

YRCW, $525

ABFS, $741

FWRD, $763

TFI, $941

ODFL, $1,240

CNW, $1,720

FDX, $28,480
SPECIAL NOTE as to both FDX and UPS:
Though here included in this summary of publicly-held LTL carriers' market capitalization, LTL operations play only
small roles in the "totalities" of FDX and UPS. I.e., during YE 2009 LTL business generated just 12.4% of FDX's
$35.5 billion of total revenue, and just 4.0% of UPS's $45.3 billion revenue total. UPS, $63,200

0.00 0.01 0.10 1.00 10.00 100.00 1,000.00 10,000.00 100,000.00
SPECIAL NOTE: This a 2 decimal point logarithmic scale, from Zero to $100.00 billion ($100,000.00 millions).


Sellers Received
Biggest Winners of Late in the North American LTL Sector:
these sale proceeds,
US$s in millions

The former shareholders of
ChrisTrucking received
$31 million from VTNC Recently, the only big winners in
the LTL sector have been those
owners who found eager buyers,
accepted their offers, cashed in
The former shareholders of their chips, and went home!
PJAX received
$116 million from VTNC

Watkins received
~$787 million from FDX

Overnite Corp. received
~$1.25 billion from UPS

USF Corp. received
~$1.3 billion from YRCW

$0 $100 $200 $300 $400 $500 $600 $700 $800 $900 $1,000 $1,100 $1,200 $1,300 $1,400


While Major and Minor Shippers Use Increasingly Sophisticated Tools to LTL Carriers’
Pricing Disadvantage:

AmherstAlphaAdvisors LLC

Q&A

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The North American LTL Marketplace @ YE2009

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