Roadrunner Transportation Systems, Inc. (NYSE:RRTS) Q3 2019 Earnings Conference Call Transcript

Nov 06, 2019 • 10:00 am ET

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Roadrunner Transportation Systems, Inc. (NYSE:RRTS) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Greetings and welcome to the Roadrunner Transportation Systems 2019 Third Quarter Financial Results Conference Call. Today's call is being recorded.

At this time, I will turn the call over to CEO, Curt Stoelting. Please go ahead, sir.

Executive
Curtis W. Stoelting

Thank you and good morning, welcome to today's conference call. Joining me are Mike Gettle, our President and Chief Operating Officer and Pat Unzicker, our Executive Vice President and Chief Financial Officer. Also joining us is Chelsea Mitchell, our Director of Marketing and Corporate Communications. To begin, Chelsea will cover the Safe Harbor statement.

Executive
Chelsea Mitchell

Before we begin, I would like to remind everyone that a number of statements made today will be forward-looking statements that relate to future events or performance. These statements reflect our current expectations and we do not undertake to update or revise these forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied in these or other statements will not be realized. Please be cautioned that these statements involve risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from the forward-looking statements.

These risks and uncertainties include the risk factors set forth in our SEC filings. Our commentary today will include non-GAAP financial measures, reconciliations between GAAP and non-GAAP financial measures for reported results can be found in our press release, which we have posted to our website. Additionally, the slides accompanying today's presentation can be accessed on the Events and Presentations tab in the Investor Relations section of our website at rrts.com.

Executive
Curtis W. Stoelting

Great, thanks, Chelsea. Before we cover today's information, I'd like to again thank our management team, our team members, our pilots, drivers, independent contractors, customers, vendors and business partners for their ongoing trust and support. We're also happy to welcome Pat Unzicker to our executive management team officially on this call.

Today on the call, we will cover the following topics. I'll provide some opening comments, Pat will provide a summary of our consolidated results for the 2019 third quarter and the first nine months. Mike Gettle will cover third quarter business trends in each of our four segments, and then I'll come back and provide an update on our strategic focus going forward, and then we'll take some time for Q&A.

So moving on to Slide 5, just to cover the -- the opening comments and the headlines. Our revenue and adjusted EBITDA declined in Q3 of 2019, primarily due to lower market demand and rates amplified by the strike at our largest customer, General Motors, which reduced revenue by approximately $17 million for the last two weeks of September and an estimated $31 million in October. The good news is the GM strikes is now over and we are seeing a ramp up in production related activities. Also late in the quarter, we successfully managed a malware attack, quarantined servers and applications, primarily impacted the LTL segment, where revenues were reduced by approximately $7 million in September, and