Forward Air Corporation (NASDAQ:FWRD) Q3 2023 Earnings Call Transcript

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That roadmap should be extremely specific with milestones, targets and dates, but to be very clear, we’re talking about a multi exiting of the effort that we started 2 years ago in a short time frame.

Jack Atkins: That will be encouraging to see, I think, as you guys disclose that. And when you think about your network, both whether it’s your terminal infrastructure or your first and final mile capabilities. Do you need to make any investments there to execute on the direct to shipper strategy, or do you feel like you have the infrastructure in place to be able to execute on that?

Tom Schmitt: Yes, we’re going to continue doing terminal expansion. If you think about this year, we actually did in the first 10 months, we did five new locations with the Land Air Express acquisition early in the year and then we opened up our 3rd Chicago area LTL terminal. So we did six this year already. We said a couple of years ago, we expect at least 30 over the next 5 years, i.e., about 6 per year. With the strategy that we’re now deploying and more aggressively than just going for SMB direct, that terminal expansion game plan may have to be accelerated also. We are very clear that this is not only about recruiting and deploying world class sales leaders, this also obviously needs to have an operating environment, a customer service environment, the pricing environment that goes with it.

So that is all part of that overall plan. Again, our strategy has been very consistent. It’s accessing as much of the high value LTL freight market as possible, direct and indirect, the tactics that we’re going to be pursuing much more aggressively are organic, and that’s I think what you’re going to be seeing in this plan very, very specifically. This is Jack where I become very German analytical nerdy, and you’ll see some of that output.

Jack Atkins: And I guess maybe last question, then I’ll turn it over. But it’s off in the room, which is Omni and the pending acquisition there. And I know you guys are probably pretty limited on what you can say, but I guess what are the next steps here? I mean, what should we be looking for from an investor perspective moving forward? And at what point are we going to maybe see some resolution to this? Just what can you tell us about the next steps related to Omni?

Tom Schmitt: Yes. We feel very strongly that we are not in an obligation to close, that the conditions for closing have not been met. And that actually does put us into a position to consider options including termination. I’m a big fan of — when things get longer, they don’t get better. So we should be getting out of the circus and into our business 100% full time as quickly as possible. So if we have this conversation again in our next earnings call, I think I did certainly miss my objective. So that’s all I can say on this, but we strongly feel that the obligations to close have not been met and the termination is an opportunity that we can seize if we choose to do so.

Operator: We’ll now go to the line of Scott Group with Wolfe Research.

Scott Group : So can you — any color you can share on any discussions you’ve had with Omni since your update a week ago and any degree of confidence of getting out of this transaction and why you feel confident you can? And then just separately, when you talk about portfolio review. Maybe just give us a little bit more color of what’s on the table of stuff to be sold?

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