JB Hunt Transport Services Inc. (NASDAQ:JBHT) Q4 2019 Earnings Conference Call - Final Transcript
Jan 17, 2020 • 10:00 am ET
John N. Roberts
extremely high retention rate, approximately 98% with this business, which we attribute to the closeness we maintain to our customers in operations and shared data used in managing the services we provide. We are also pleased to have recently announced our third acquisition for Final Mile.
Through 2019, Intermodal continued to strive to return to load growth and demonstrated a slight directional uptick through the third and fourth quarters. As we are in the early stages of bid season, we will watch closely for a balanced approach to growth and rate quality. We continue to experience cost headwinds and utilization challenges, both of which keep pressure on desired near-term margin improvements. Hopefully, with much of the PSR work behind us, we can work with our rail providers to increase the transit velocity and service reliability needed to convert more business from the highways going forward. In addition, we will keep a close watch on freight patterns with newer customers in 360 for Intermodal conversion opportunities.
Our Highway Services lines, ICS and Truckload, continue to monitor the pricing cycle challenges presented through the fourth quarter and the beginning of bid season. Our Truckload business delivered a solid year given the conditions in 2019 and continues its march toward a more asset-light model into 2020. ICS will continue to work through current bids, and we expect the investment in technology, particularly for the marketplace and shipper and carrier programs in 360, to continue throughout 2020.
Lastly, we will be breaking out the Final Mile service business from DCS beginning in first quarter 2020 with supporting financial data for the prior year from both Final Mile and Dedicated.
2019 was a progressive year in many respects, and I see the setup for 2020 is productive. I expect this year to both reveal and confirm our strategy in executing on our base businesses, while we expand our presence within our growth channels.
Now -- I'll now ask Dave Mee to make his comments.
Thanks, John. I'll just going to focus a little bit more on the shorter term results, basically around the fourth quarter of 2019. We experienced a fairly strong but a very compressed peak season during the quarter, and it allowed no room for operational hiccups. In addition, we saw customer expectations for operational accuracy at one of the highest levels we've ever experienced. This was not a surprise to us going into the quarter, and we knew that if conditions change from our planning assumptions, we were going to err on the side of customer satisfaction.
In Intermodal, we realized some volume growth off the West Coast, as expected, but we also continue to feel the effects of the volume contraction as we finally get to lap the lane closure comps, but continue to see headwinds from truck competition in the Eastern network. And the Western growth was not seen across all of our customers. That put additional pressure on revenue per load results. In addition, we lost some volume due