Radiant Logistics, Inc. (RLGT) Q2 2019 Earnings Call Transcript

Good day, ladies and gentlemen. This afternoon, Bohn Crain, Radiant Logistics' Founder and CEO; and Radiant's Chief Financial Officer, Todd Macomber, will discuss the Financial Results of the Company's Second Fiscal Quarter and Six Months Ended December 31, 2018. Following their comments, we will open the call to questions. This conference is scheduled for 30 minutes. This conference call may include forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. The company has based these forward-looking statements on its current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about the company that may cause the company's actual results or achievements to be materially different from the results or achievements expressed or implied by such forward-looking statements. While it is impossible to identify all the factors that may cause the company's actual results or achievements to differ materially from those set forth in our forward-looking statements, such factors include those that have, in the past, and may, in the future, be identified in the company's SEC filings and other public announcements, which are available on the Radiant website at www.radiantdelivers.com. In addition, past results are not necessarily an indication of future performance. Now I'd like to pass the call over to Radiant's Founder and CEO, Bohn Crain. Sir, please go ahead.

Thank you. Good afternoon, everyone, and thank you for joining in on today's call. We are pleased to report new record results across all of our key financial metrics and the continued broad based improvement in our financial performance for the second fiscal quarter ended December 31, 2018. For the quarter, we posted record revenues of $260.9 million, up $54.2 million or 26.2%; record net revenues of $64 million, up $16.6 million or 35%. Net income allocable to common shareholders of $3.8 million, up $0.5 million, record adjusted net income allocable to common shareholders of $8.2 million, up $4.6 million or 127.8%, and record adjusted EBITDA of $12.5 million, up $5.4 million or 76.1% over the comparable prior year period. Our net revenue margins also improved, up 160 basis points to 24.5% from 22.9% for the comparable prior year period. In addition, we also saw improvement in our adjusted EBITDA margins, which increased 440 basis points to a record 19.5% from 15.1% for the comparable prior year period. Our positive trend of solid organic growth continued both in terms of geography and service offering. In the U.S., we reported revenues of 238 - excuse me, $231.8 million, up $52.3 million and 29.1%; and net revenues of $55.5 million, up $14.7 million or 36% over the comparable prior year period. Transportation net revenues of $54.4 million were up $14.2 million or 35.3% for the comparable prior year period. Value-added services net revenues of $1.1 million were up $0.5 million or 83.3%. In Canada, we reported revenues of $29.3 million, up $1.7 million and 6.2%; and net revenues of $8.5 million, up $1.9 million or 28.8% over the comparable prior year period. Transportation net revenues of $5.1 million were up $1 million or 24.4% from the comparable prior year period. Value-added services net revenues of $3.4 million were up $0.9 million or 36%. These positive results also delivered strong cash flows for the business. Through the six months ended December 31, 2018, we generated a record $16.4 million in cash from operations. With the benefit of these strong results in December, we were able to redeem our $21 million preferred stock through a combination of cash and access to our senior credit facility, eliminating approximately $2 million in future annual dividend payments. As of December 31 and after giving effect for the redemption of the preferred, we had approximately $36 million in availability under our existing facility, not including access to an additional $50 million accordion feature to support our M&A activities under that same facility. In addition, we also recently took the opportunity to refresh our $100 million equity shelf registration, which provides us with continued financial flexibility to access capital to support and accelerate our growth strategy should the opportunity present itself. We are encouraged by our continuing strong financial performance. Through the 12 months ended December 31, '18, and for that TTM period, generated $36.9 million of adjusted EBITDA. We remain committed to our long standing strategy to deliver profitable growth through a combination of organic and acquisition initiatives, and we believe that our current run rate is reflective of the opportunities ahead of us. With that, I'll now turn it over to Todd Macomber, our CFO, to walk us through our detailed financial results, and then we can open it up for some Q&A.

Thanks, Bohn, and good afternoon, everyone. Today, we will be discussing our financial results, including adjusted net income and adjusted EBITDA for the three and six months ended December 31, 2018. For the three months ended December 31, 2018, we reported net income allocable to common stockholders of $3,766,000 million on $260.9 million of revenues or $0.08 per basic and $0.07 per fully diluted share, which included a $476,000 gain on change in contingent consideration and a charge for issuance costs related to the redemption of the preferred stock in the amount of $1,659,000 million. For the three months ended December 31, 2017, we reported net income allocable to common stockholders of $3,330,000 million on $206.7 million of revenues or $0.07 per basic and fully diluted share, which included $190,000 expense on change in contingent consideration. This represents an increase of approximately $436,000 over the comparable prior year period or 13.1%. For the three months ended December 31, 2018, we reported adjusted net income attributable to common stockholders of $8,154,000 million. For the three months ended December 31, 2017, we reported adjusted net income attributable to common stockholders of $3,555,000 million. This represents an increase of approximately $4,599,000 million or approximately 129.4%. We reported adjusted EBITDA of $12,499,000 million for the three months ended December 31, 2018, compared to adjusted EBITDA of $7,132,000 million for the three months ended December 31, 2017. This represents an increase of approximately $5,367,000 million or approximately 75.3%. And moving along with the six months results. For the six months ended December 31, 2018, we reported net income allocable to common stockholders of $6,388,000 million on $479.8 million of revenues or $0.13 per basic and $0.12 per fully diluted, which included a $571,000 gain on change in contingent consideration. For the six months ended December 31, 2017, we reported net income allocable to common stockholders of $3,646,000 million on $404.7 million of revenues or $0.07 per basic and fully diluted share. This represents an increase of approximately $2,692,000 million over the comparable prior year period or 73.8%. For the six months ended December 31, 2018, we reported adjusted net income attributable to common stockholders of $13,531,000 million. This six months ended December 31, 2017, we reported adjusted net income attributable to common stockholders of $6,494,000 million. This represents an increase of approximately $7,037,000 million or approximately 108.4%. We reported adjusted EBITDA of $21,312,000 million for the six months ended December 31, 2018, compared to adjusted EBITDA of $13,616,000 million for the six months ended December 31, 2017. This represents an increase of approximately $7,696,000 million or approximately 56.5%. With that, I will turn the call back over to our operator to facilitate any Q&A from our callers.

Thank you. [Operator Instructions] And our first question comes from Jason Seidl from Cowen and Company. Please state your question.

Hey, guys. This is Adam on for Jason. Congrats on the quarter.

Thank you.

First, just wanted to ask you guys about any impact you've seen from tariffs, whether you guys think you may have benefited from some pull forward prior to the tariffs and maybe if you think that there may be some weakness once the tariffs do go into effect over the coming months?

Thank you for that. So our current results were meaningfully impacted by tariffs one way or another, and prospectively, I'm not expecting them to be impacted meaningfully as well. A relatively small portion of our business is truly international, air and ocean freight forwarding. Most of our business is focused on time-definite North America ground freight. And so our record results and expectations of future results don't have a lot to do with our view of tariffs. Did I mention it was a record quarter?

I think you did. Yes.

Okay. And the tariffs have no - really didn't play into it.

All right. I appreciate that. And, I guess, just a quick follow-up from me. Just anything that you guys have seen in terms of kind of bid season so far. What have you guys kind of seen in terms of - with spot rates falling, obviously, with trucking? What have you guys kind of seen on your end in terms of the deteriorating [ph] conversations and kind of pricing in terms of looking out to 2019?

Well, I think we've seen some price recovery. I think the market's staying reasonably tight. We saw good margin expansion in terms of - we had several 100 basis points improvement in the margin characteristics of the business. So I think there is some talk of things loosening up, but from our standpoint, things still remain relatively tight. And we have talked historically about some of our contracts repricing, particularly in the intermodal sector, and kind of those things played out. And we got some improvement in those contracts as they rolled over. So there will always be a push and pull within the marketplace, but we believe the market's still generally relatively tight and sets up well for us, prospectively.

Great. And then just finally, finally for me. Do you guys have kind of an expectation in terms of pricing number for that for 2019 or kind of a range that you can give from what your expectations are?

For which?

What's called renewals for TL [ph]

No. What we're hearing out there is the - probably the same thing you are. We listen to all the same conferences in terms and what the asset based carriers are suggesting or looking for in terms of rate increases in the marketplace. So - and my understanding of that is what I would call low to mid single digit increases is what the underlying asset based guys are continuing to kind of price talk, if you will, and how they're trying to set expectations in the marketplace.

Sure. Thank you, guys, so much for the time. I appreciate it. And I’ll pass it on. Thank you.

All right. Thank you.

Thank you. Our next question comes from Kevin Sterling from Seaport Global.

Thank you, operator. Good afternoon, Bohn and Todd.

Good afternoon.

Good afternoon, Kevin.

How do you guys survive in snowy Seattle?

Its funny that you say that. It is snowing sideways outside right now, which is – doesn’t often happen in Seattle.

That’s why – the city might be shut down, right?

Well, there is a lot of stake here because I expect to be in Miami in the morning, so I am hoping the planes are flying.

Oh! Gosh. Good luck with that. But hey, let me just start off. I've been following you guys a long time, Bohn, and I got to say, I think this is the best quarter I've seen out of you guys. And it sounds like I heard you talk about record quarter, so congrats, my hats off to you. It looks like everything came together very nicely for you. So along those lines, the growth that we're seeing across the board, is that all organic?

Yes, this is a clean quarter in terms of - even last quarter, only had a very, very modest amount of acquisition activity, but this has been absolutely clean quarter. And so the results that we're seeing are purely organic. We have said historically that through our vertical strategy and some of our other initiatives and some of the success we were having in Canada, that we were really focused on organic growth, not that we're not still interested in acquisition opportunities, and we'll be exploring those as well. But growth in organic is certainly one of the key prongs of our strategy, and what we see here is the result of those efforts.

That's awesome. Great. So let me ask you along those lines. Do you think, as you look at your company today, we're in an inflection point? It seems like you guys started to turn the corner maybe a couple of quarters ago, and it really all came together this quarter with just these record results. And what I mean by that is, Bohn, with the systems you have in place, the people you have in place, is your company positioned like it's never been before to capture market share?

I think by any metric, in terms of financial and its kind of underlying results, but also financial flexibility, if we think about our run rate EBITDA, and I'm not going to throw out a particular number, but we can certainly talk about that broadly, but where we are in terms of having retired the preferred, we're going to drop another - we're - we relieved ourselves of $2 million in non-deductible $2 million dividend payments. We've got good capacity under our credit facility. We're generating free cash flow like we never have in the history of the business. And a lot of things are kind of working our way. We went so far in this current press release to include TTM analysis of our adjusted EBITDA on a quarterly basis, and it really kind of lays out the - kind of the transition. And so the net-net is we have really 1 more, what I'll call, soft quarter or easy comp coming up here for the quarter ended March in the year-ago period. So for this TTM, I think we're close to $37 million of run rate EBITDA. We would expect that number to move closer to $40 million as we replace last year's quarter ended March results. So we - so that's - having followed us as long as you have, you know that, that's -- those are some really meaningful improvements for the business. And then -- and also to your point, it's coming from all areas of the business. The forwarding business is doing very well. Canada is doing well. Clipper has been improving and back within the forwarding network itself. Our agent stations are thriving. I think we paid out more money in commissions this quarter as well than we probably ever had in the history of the company. That goes to the health of the platform, the health of the partnership we have with our operating partners and the success they are able to achieve as part of the platform. And at the same time, the company-owned stores within the forwarding network are doing better as a group than they ever have in the history of the business. The technology platform continues to improve. I think recently, we had - over 10% of our forwarding transaction volumes were occurring through the new SAP-TM. So we continue to kind of work through that process, and we feel pretty good about where we are and kind of how things set up looking out into 2019.

Well, Bohn, that's great. Those numbers are quite impressive. So it's good to see. Like I said, I've been following you guys a long time, and I quite frankly don't remember a time like this in your company's history, how well positioned you are. But you talked about the SAP system. If I'm not mistaken, you're probably one of the few 3PLs to deploy SAP as a TMS. And is that a competitive advantage because the majority of shippers operate on SAP?

Yeah, we think it certainly will be -- and that will prove itself out over time. I would -- I'm going to break it. So a great question. I want to break the question apart. We have since the very - since our very first acquisition, our platform acquisition back in 2006 of Airgroup, Airgroup was on SAP from an accounting standpoint. So we've grown up as an SAP shop. And in terms of kind of the sophistication and relative scalability of our back-office infrastructure, we think we have a world-class back-office platform. And as we think about scalability and kind of unit cost per transaction process and some of those types of things, we really believe that we're best-in-class. And we've had an opportunity to move to a new TMS and to have a fully integrated operating system and accounting system on a singular SAP platform, I think, will create a lot of benefits for us up to and including kind of what you're describing, which is there's a big universe of installed SAP customers out there more in the manufacturing universe, and those guys are generating hard freight, right? And so we view that as a unique opportunity for us to be able to engage with this big universe of installed SAP customers and be able to engage with them and exchange information with them in a way that other folks simply won't be able to because they don't speak SAP with the granularity and familiarity that we'll be able to from our singular SAP platforms. So we're really excited about that and what that represents kind of long-term strategically. We talked about it before. We really have intentionally set out to build a back-office infrastructure that we believe can support a multibillion dollar business in terms of the scalability and how we position ourselves as the first to market in terms of aggregating these agent based freight forwarding networks. It puts us in a really interesting position, and then hopefully, we'll have an opportunity to take advantage of that as we look into the future.

That's awesome. So basically, what you're doing now with the SAP system, you're building this foundation. So obviously, you talked about multibillion-dollar organization to really kind of grow.

That's always been the vision, and we're...

We're starting to see it.

We're getting one step at a time, but I think this quarter - and, I mean, we didn't talk about it, but we also spend a lot of time talking about EBITDA as a function of gross margin and how those numbers have trended over time. And it's just a great -- ultimately, the math speaks for itself, but just a great storyline in terms of the scalability of our back office and over time, how we've been able to drive that metric and getting more of those gross margin dollars to the bottom line over time through our investment and people processing technology.

Yes. Awesome. So, Bohn, have you guys - have you kind of - have you started a national sales force to go after maybe some larger accounts? And if so, have you kind of seen the fruits of that labor and some new business wins?

Look, we haven't organized ourselves in what you would think of as a traditional national account sales program. What we've done instead of that is focused on a vertical sales strategy. So we've hired a number of senior sales executives with a deep competency in a particular industry vertical. And so we've approached the market with that vertical orientation. Some of those markets include government services, retail, humanitarian aid or some other areas that we focus on. And we've had a lot of success without getting into particular customers. The vertical strategy has worked very well for us in terms of helping drive that organic growth and we'll opportunistically continue to build out additional verticals with additional resources as we can identify those in the marketplace to continue to fuel our organic growth.

Awesome. One last question for me. And so you touched on free cash flow, and if my calculations are right, it looks like you generated nearly $11 million of operating cash flow in the quarter and, obviously, leading to strong free cash flow. Going forward, I mean, I've got a sense, you can tell me if I'm wrong, but going forward...

We got to stop there. We got to have a little fun with this. You know what that is, Kevin. That's another record.

Another record there, all right. Not allowed to keep breaking record. I know. But am I thinking about this right? Going forward, your free cash flow generation should continue to really build upon itself, and we should really have a nice couple of quarters for the rest of 2019 and fiscal year 2020 of some significant free cash flow generation. Am I thinking about that right?

Yeah, absolutely. In terms of - well, one, the underlying business has improved markedly as well as the redemption of the preferred was the proverbial shooting fish in a barrel and eliminating $2 million of those dividends for us. So absent acquisition activities, our credit lines are going to pay down pretty quickly.

Got you. Okay. Well, that’s all I had. Congrats on the quarter, keep up the good work, breaking records. And hope you get to Miami.

All right. Thanks.

Take care.

Thank you. Our next question comes from Mark Argento from Lake Street Capital. Please state your question.

Hey, guys. Congrats on a very solid quarter. Wish I could feel sorry for you about the snow, Bohn, but being from Minneapolis...

Yes, we're not getting any sympathy for most parts of the country.

We got our fair share, so best of luck. Miami sounds wonderful, though. I was just hoping if - obviously, a lot of positive things going on here. I was hoping you could just help us think through a little bit around this concept of productivity relative to pricing. So you saw adjusted EBITDA margins up 440 basis points. Are we getting half of this from pricing and half of it from productivity? How can we think about - and obviously, there's ebbs and flows in the pricing environment. It's been a tighter environment, which benefits, to a degree. But maybe you could help us think through a little bit about how you guys think internally about productivity, unit growth versus ASP growth or, we'll call it, pricing growth?

Yes, sure. So I'll - I can take us - swipe that from a high level. What we know is that our incremental cost of supporting that next dollar of gross margin is very, very small. So ultimately, it's - the biggest driver is just our ability to grow our gross margin dollars, because our incremental costs are supporting those - that next dollar of gross margin is very small. Now on the back side of that, if you think - if we kind of look at our cost of drivers, it's headcount, right? And our biggest physical labor dollar spend is in the -- in and around the area of the financial settlement of the - of our transactions, whether it's paying the carriers or ultimately settling with our operating partners that are originating a lot of the freight out there. So we've introduced a lot of technology around optical scanning technologies to help automate how we ingest invoices, how we deal with what we would call variances or differences between what was protected as the cost versus the cost that's ultimately arrived. And we're spending a lot of time and energy focusing on, I'll use the term, electrifying our business in terms of building more electronic connectivity with our customers and our carriers, with the goal of driving productivity improvement not only for ourselves but also for our carrier partners and our customers. And so that's our orientation, doesn't take you through the ultimate math. But the one thing that I would call out, I think we've talked on it on prior calls, if we look at the Expeditors and C.H. Robinsons of the world and look at their EBITDA as a function of gross margin, then I think we'll find that their metrics are up in the 30% to 40%-type handle. And we've said from the beginning, that's the curve that we're marching up as we continue to scale the business. And I can remember when that number for ourselves was 2% and 3%, and then 6%, and then 8%, as we continue to kind of work our way up the mountain. So this - I think it was 19.5% for this quarter was a really good result for us, but there's lots of incremental opportunity ahead of us as we continue to scale the business.

That's helpful. Thanks for that additional color. And one other thing, obviously, as you march to $1 billion plus business and beyond, we used to hear a lot about the great tale [ph] in certain types of these acquisitions, and you guys are the natural - kind of the natural liquidity provider for some of these guys who've been in the business for a while. Is that still part of the strategy? Or have you kind of gotten to the point now where for it to move the needle, you have to look at bigger, chunkier things? What should we or how should we think about the acquisition strategy going forward?

Part of our brand promise is to support our operating partners when and if they are ready for their own transition. So we're not - we're certainly not out there twisting people's arms, trying to compel them to sell or convert to a company-owned store, but on a time that's right for them, we'll be there to support them. So the pace at which we affect those transactions has more to do with the goals and objectives of our operating partners than any particular initiative we have. We're open for business, and we're prepared to support our partners in that way when they are ready. And at the same time, we'll continue to look for other tuck-in acquisitions. That's only -- the conversion of agency stations, the company-owned stores is only one, an important one, but only one of a multipronged strategy on the acquisition side of the house.

Great, thanks. And I’ll make sure [indiscernible]

All right. Thanks.

Thank you. Our next question comes from Jeff Kauffman from Loop Capital. Please state your question.

Thank you very much. Hi, everybody. Did I hear you right, you guys were shipping a bunch of records this quarter?

That's good. We actually do a little of that business. But no, that wasn't for us. Well done, Jeff. That was good.

All right. You just talked about all these records. I'm trying to figure it out.

That was good. I like that.

I got to say Congratulations. It's just a great quarter to see. I know you've been working hard. It's just nice to see it all come together like this. So let me go back and be a broken record here. So when you say you don't believe tariffs played any role in this, in other words, you don't believe there was any pre-shipping of goods that occurred in your network this quarter, correct?

Well, I would - I'm sure that there was certainly some, but more the point I was trying to make, and perhaps I didn't do it justice, was that if we think of - if we were going to draw the economic pie of the various contributors to our business, international transportation, true international air and ocean, which would be the subject of a lot of these trade activities, isn't a driver in our business or at least it hasn't been to date. So was there a little pull forward? Perhaps.

Maybe.

But is that what drove our record results? Absolutely not.

Okay. So I shouldn't annualize the $12 million in EBITDA is what you're saying?

No. Well, I - boy, wouldn't that be wonderful? No. We certainly don't want to set that expectation. We're appreciative for those results. We're trying to have a little fun with it, but we're quickly going to be back to work and worried about next quarter.

Okay. What - and I think you answered this last quarter, but I'm going to ask it again. Terrific improvement in operating margins in the Canadian business. Can you remind me what's driving that?

Sure. We - this is the result of a - really, a strategic initiative we set in place, really, probably 12 months ago, and what I'll broadly call a bundling strategy, where we - and it really kind of began in earnest with our tuck-in acquisition of Lomas in Canada, which brought to us more value-added logistics services in conjunction with transportation. So what you're seeing there is a growth in our, effectively, warehousing and distribution service. That's bundling that with transportation services. And so making our customers stickier, making our work more valuable to the end customers that we serve and has really proved to be a real growth engine for Canada, at least, so far.

Okay. One other detailed question, probably more for Todd, and then a general question. There is the new ASU on the new lease accounting rules. It would not have to affect you until the close of this fiscal year, mid-year, but it does bring some operating lease rents to be considered potentially as capital leases. Todd, have you looked at this? I think you're doing about $8 million in operating rents. What impact do you think this will have in terms of 2020 fiscal?

We're still assessing that, Jeff. We're looking at - we're bringing up a system for that, but I don't have exact - the exact amount on that right now, but that's something that we're working on right now.

Okay. And then a broader picture, Bohn, amazing quarter, but we have seen some slowdown on the brokerage side of the business with the spot rates moving around, doesn't affect your business so much. But I wonder if you're seeing any softening in some of the acquisition prices of potential acquisition candidates. You're sitting on all these great fundamentals. You've saved some money repurchasing the preferred. Is there any change in what you're seeing? And are business acquisitions getting a little bit more interesting?

I think it still remains really competitive out there and particularly at anything of scale. And so - whereas I would like to say I've seen a lot of softening in price on the M&A side, I personally haven't. Certainly, I think the public company comps have come in relative to the expected growth rates and that kind of stuff. But I think at the end of the day, the PE firms are still driving valuations for transactions of scale, and I have not seen those come in. But when they do, we'll be there.

Fantastic. Well, congratulations, just a terrific quarter all the way around here.

Thank you so much.

Thanks, Jeff.

Thank you. Our next question comes from Gerry Heffernan from Walthausen & Company.

Hey. Thank you very much. I just wanted to ask a little bit - or just 1 question on the income statement here. I understand the cost of transportation is the expense driver, and you've done a very good job of improving your margin there. Could you talk to the operating partner commissions as that has grown disproportionately to the growth in overall revenues?

Sure. So it goes to the underlying kind of nature of our business, where a good chunk of our business originates from our operating partners and we effectively share in the gross margins that they generate. So - well, let me draw a distinction so this will be good for people not necessarily as familiar with our business. So if we were going to compare and contrast a transaction originating from a company-owned store versus a transaction originating from an agency station, it maps into our financial statements the same, down to the gross margin line. So whether it's coming from our company owned store in Los Angeles or an agency station in Dallas, it's the same, down to the gross margin line item. But where it's originated from an agency station, we share in that revenue with the agents, and that's where those expenditures land on the P&L. So what that would say is, for this quarter, our agency stations did really well in terms of their growth in their business. And so their gross margins - or their percentage of the economic pie went up And so I think we could also draw, and I think this is kind of where you're going with your question, proportionately, they grew by more than the company owned stores grew, fourth quarter…

Okay. And is there any specific release for that?

No. I don't - I mean, there are - it's an extraordinarily diversified portfolio of businesses. And from time to time, there's - let me tell it this way, we have over 100 operating locations, and I think we have 20 company owned stores. And so sometimes, agent stations will originate their own business, and they service it through our network. Sometimes, corporately, we'll originate business, but based on geography and service needs, we will place that business in an operating location, and they will effectively operate it on our behalf, if you will. So there's a myriad of factors that can come into play around the agent stations and kind of where an individual transaction lands. But I am - it's funny that you raised this question. I've actually -- I was attending on my plane ride to Miami tonight to write a letter to the network to celebrate with them how happy I was for them that they had such success this quarter, that as our partners do well, we do well. And I couldn't be happier that they had such great results and such good success. And hopefully, data points like this will get other agency locations that currently aren't part of our network to consider to come be part of our network.

Yes, certainly, success does attract businesses and business people. That is a good thing. In regards to the strong top line, you've commented that it was pretty broad – broad based. Could you just - if you could, just give a - speak to the different client verticals or the shipper verticals that you represent and just give us any color that you may have from what you saw in those different segments over the quarter?

We don't want to get into too much detail there, but at a - certainly, at a high level, we do a fair amount of work in government services. We do a fair amount of work in life sciences. We do a fair amount off work in humanitarian aid. We do a fair amount of work in the automotive vertical. We do a fair amount of work in trade shows. So that those kind of give you some high-level lanes in which we're having some success.

Great. Thank you very much and as a shareholder greatly appreciate all the work you’ve done.

Thank you.

Thank you.

Thank you. And that appears to be our last question. I'll turn the floor back over to Bohn Crain.

Thank you. Let me close by saying that we remain very excited with our progress and prospects here at Radiant, and we remain very bullish on the growth platform that we've created and the scalability of our non-asset-based business model. Our now more than 10 year first to market advantage in executing our multibrand strategy and consolidating agent-based forwarding networks, ongoing investment in technology and low leverage on our balance sheet puts us in a unique position to support further consolidation in the marketplace. We believe this represents our longer term and almost perpetual opportunity, and we continue to invest in technology and our people, with an eye towards building out a world-class scalable back-office infrastructure to support a much larger enterprise going forward. We are patiently persistent in pursuit of this long-term vision, which we believe, over time, will deliver meaningful value for our shareholders, our operating partners and the end customers that we serve. Thanks for listening and your support of Radiant Logistics.

Thank you. This does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time. And have a great day.