Tripp Grant: Yes. I would agree with that. But Scott, just to add on to that, the thing I’m most proud about is the fact that the base business is growing. And I think we can – if we look year-over-year, I think we can grow operating income year-over-year. But some of the things that have hindered the P&L this year from whether it’s tail or whether it’s interest expense, those are going to be a little bit of a, I said, bigger headwind, I would say, year-over-year. So it’s kind of going to be offsetting those earnings a little bit, but not significantly, I would say.
Operator: [Operator Instructions] And we’ll move to our next question from Elliot Alper with TD Cowen.
Elliot Alper : This is Elliot on for Jason Seidl. I wanted to ask about dedicated tractor count going forward, stepped up sequentially in the first quarter. How should we think about that going forward? I mean similar to some other questions we’ve been hearing about new shippers stepping into dedicated to lock in some rates given the current environment. I guess are you guys seeing this at all and expect any pricing pressure there from new business?
David Parker: Yes. I mean, there’s definitely a lot of one-way guys trying to get in and do dedicated given the market. , let me answer your first question, truck count. I think you’ll see the truck count probably Q2, you’ll see the truck count go up a little bit. And then I don’t have a lot of visibility past that. But Q2, the truck count will go up and then I could see a flatlining for a little while because it’s a tough market out there to add new business. And so we’re going to keep working on the pipeline. As far as new entrants, it’s — there’s no doubt it’s competitive out there, and — but we’re still winning as much as we’re losing.
Elliot Alper : And then given the softness in the brokerage environment, I guess, how are you able to hold up managed freight margin so well. We’ve seen losses at other carriers. Curious to hear about your outperformance there. You spoke to some margin pressure going forward. I guess — should we think about that maybe similar to margins of second quarter of 2023?
David Parker: Yes, probably similar to second and third and fourth quarter of last year. I mean, really, let what we’re focusing on is making sure we’re not out chasing this stuff. We’re not trying to buy a bunch of freight with our brokerage to make yourself feel good about top line revenue and lose money. And so if we can help a customer and make a little money on it, we’re going to do it. But revenue just for revenue’s sake in our world, don’t make a lot of sense. And so we’re just managing our overhead and trying to make sure can we make a scrape on what we’re doing and not chasing stuff to the bottom of the barrel.
Operator: Next question will come from Jeff Kauffman with Vertical Research Partners.
Jeff Kauffman : And congratulations on a terrific quarter and a very challenging freight environment. I want to follow up on the last question and maybe look beyond the next quarter or 2. I know we tend to manage the business for — in the short term, sometimes. But you mentioned the 2 new dedicated start-ups, the changing face of dedicated Lew Thompson. As we look out 2 years, 3 years, can you talk about what this means for the dedicated franchise? And is [Tractor] really the right way to think about growth since some of this new business is shorter haul, should we really be thinking about miles — and then what could that growth curve look like in a normal environment for, let’s say, 24 months, 36 months out?
Tripp Grant: Yes. Jeff, this is Tripp. One, we’re very pleased with the way that Lew Thompson has performed over the last 12 months. In fact, Friday will be the 12-month anniversary of the acquisition and it has been nothing short of a blessing for them and for us to be partners in this kind of work together. And we’ve — the teams have worked well together. The strategy is working, and we’ve experienced a lot of tailwinds with some immediate growth that, quite honestly, we didn’t even model when we were pursuing the acquisition prior to signing the documents. But Here’s what I would tell you. I do think the future is bright, I’d be hesitant to put some numbers 2 years, 3 years out. But I would say that I’m excited with what I’ve seen.
But I would also say that our focus is more on the shorter term because this is such a — high service-oriented business, and it’s something that we’re new to. And Lou and Josh are kind of guiding us. We’ve got another really good operator out there that we’ve moved out there to help learn the business. He’s doing a great job. But we want to make sure that we continue that same standard of service for the previous existing customers and execute well on new start-up businesses. So we’re — it doesn’t sound good for me to say that we’re focused on the short term, but it’s absolutely critical for all of our team to be focused on that short-term growth, making sure every one of those happy — or every one of those customers, whether new or preexisting or continue to be happy with the level of service.
And we’ve got confidence that more growth will come. But I do think that it is a good number. It’s a number that I wouldn’t want to publish or make public, but we’re excited about what I would call the momentum that we’re taking into 2024 and to 2025.
Jeff Kauffman : And just a follow-up, if I can. Tractor fleet down to, I think you said 21 months that’s fantastic, and that’s showing up in maintenance cost savings. But I guess given the operating environment, you said fleet count up a little bit dedicated than kind of leveling out. Is there any thought about shifting capital in this environment? You were talking about the pressure from interest expense in future quarters. Where is your debt relative to your goals and your targets? And does it make sense to shift some capital and maybe reduce that interest expense or no?
