Daseke Q2 2022 Earnings Presentation
Important Disclaimers
Forward-Looking Statements
This presentation contains "forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words
such as "may," "will," "expect," "anticipate," "continue," "estimate," "project," "believe," "plan,"
"should," "could," "would," "forecast," "seek," "target," "predict," and "potential," the negative of
these terms, or other comparable terminology. Projected financial information, including our
guidance outlook, are forward-looking statements. Forward-looking statements may also include
statements about the Company's goals, business strategy and plans; the Company's financial
strategy, liquidity and capital required for its business strategy and plans; the Company's competition
and government regulations; general economic conditions; and the Company's future operating
results. These forward-looking statements are based on information available as of the date of this
presentation, and current expectations, forecasts and assumptions. While management believes that
these forward-looking statements are reasonable as and when made, there can be no assurance that
future developments affecting us will be those that the Company anticipates. Accordingly, forward-
looking statements should not be relied upon as representing the Company's views as of any
subsequent date, and the Company does not undertake any obligation to update forward-looking
statements to reflect events or circumstances after the date they were made, whether as a result of
new information, future events or otherwise, except as may be required under applicable securities.
laws. Readers are cautioned not to place undue reliance on the forward-looking statements.
Forward-looking statements are subject to risks and uncertainties (many of which are beyond our
control) that could cause actual results or outcomes to differ materially from those indicated by such
forward-looking statements. These factors include, but are not limited to, general economic and
business risks, such as downturns in customers' business cycles, disruptions in capital and credit
markets and inflationary cost pressures, the Company's ability to adequately address downward
pricing and other competitive pressures, the Company's insurance or claims expense, driver
shortages and increases in driver compensation or owner-operator contracted rates, fluctuations in
the price or availability of diesel fuel, increased prices for, or decreases in the availability of, new
revenue equipment and decreases in the value of used revenue equipment, impact to the Company's
business and operations resulting from the COVID-19 pandemic, seasonality and the impact of
weather and other catastrophic events, the Company's ability to secure the services of third-party
capacity providers on competitive terms, loss of key personnel, a failure of the Company's
information systems, including disruptions or failures of services essential to our operations or upon
which our information technology platforms rely, data or other security breach, or cybersecurity
incidents, the Company's ability to execute and realize all of the expected benefits of its integration,
business improvement and comprehensive restructuring plans, the Company's ability to realize all of
the intended benefits from acquisitions or investments, the Company's ability to complete
divestitures successfully, the Company's ability to generate sufficient cash to service all of the
Company's indebtedness and the Company's ability to finance its capital requirements, restrictions in
its existing and future debt agreements, increases in interest rates, changes in existing laws or
regulations, including environmental and worker health safety laws and regulations and those
relating to tax rates or taxes in general, the impact of governmental regulations and other
governmental actions related to the Company and its operations, and litigation and governmental
proceedings. Additional risks or uncertainties that are not currently known to us, that we currently
deem to be immaterial, or that could apply to any company could also materially adversely affect our
business, financial condition, or future results. For additional information regarding known material
factors that could cause our actual results to differ from those expressed in forward-looking
statements, please see Daseke's filings with the Securities and Exchange Commission, available at
www.sec.gov, including Daseke's most recent annual report on Form 10-K and subsequent quarterly
reports on Form 10-Q, particularly the section titled "Risk Factors".
Non-GAAP Financial Measures
This presentation includes non-GAAP financial measures for the Company and its reporting segments,
including Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Operating Income, Adjusted Net
Income (Loss), Adjusted Earnings Per Share, Adjusted Operating Ratio, Free Cash Flow, Free Cash
Flow Yield, Adjusted Return on Equity and Net Debt. Please note that the non-GAAP measures
included herein are not a substitute for, or more meaningful than, net income (loss), cash flows from
operating activities, operating income or any other measure prescribed by GAAP, and there are
limitations to using non-GAAP measures. Certain items excluded from these non-GAAP measures are
significant components understanding and assessing a company's financial performance, such as a
company's cost of capital, tax structure and the historic costs of depreciable assets. Also, other
companies in Daseke's industry may define these non-GAAP measures differently than Daseke does,
and as a result, it may be difficult to use these non-GAAP measures to compare the performance of
those companies to Daseke's performance. Because of these limitations, these non-GAAP measures
should not be considered a measure of the income generated by Daseke's business or discretionary
cash available to it to invest in the growth of its business. Daseke's management compensates for
these limitations by relying primarily on Daseke's GAAP results and using these non-GAAP measures
supplementally. You can find the reconciliation of these non-GAAP measures to the nearest
comparable GAAP measures in the Appendix.
In the non-GAAP measures discussed below, management refers to certain material items that
management believes do not reflect the Company's core operating performance, which management
believes represents its performance in the ordinary, ongoing and customary course of its operations.
Management views the Company's core operating performance as its operating results excluding the
impact of items including, but not limited to, stock-based compensation, impairments, amortization
of intangible assets, restructuring and business transformation costs, severance, and all income and
expenses related to the Aveda Transportation and Energy Services ("Aveda") business. Management
believes excluding these items enables investors to evaluate more clearly and consistently the
Company's core operating performance in the same manner that management evaluates its core
operating performance. Although we ceased generating revenues from our Aveda business and
completed the wind-down of our Aveda operations 2020, we continued to recognize certain
income and expenses from our Aveda business in 2021 and 2022. Such income and expenses relate
primarily to, but is not limited to, workers compensation claims and insurance proceeds. Previously,
to provide investors with information about the Company excluding the impact of the Aveda
business, the Company presented certain GAAP and non-GAAP measures appended with ex-Aveda,
which represented the measure excluding the impact of the Aveda business. However, beginning in
the quarter ended March 31, 2022, the Company no longer provides ex-Aveda measures because the
impact of the Aveda business is no longer material or meaningful to a discussion of the Company's
operating results or financial condition (e.g., the comparable period in the prior year is now after the
completion of the wind-down of the Aveda business). Instead, the income and expenses from our
Aveda business will be considered as items that management believes do not reflect our core
operating performance. Such income and expenses can be identified in the non-GAAP reconciliations
under the adjustment called "Aveda expenses, net" and "Aveda operating expenses, net".
We have not reconciled non-GAAP forward-looking measures to their corresponding GAAP measures
because certain items that impact these measures are unavailable or cannot be reasonably predicted
without unreasonable efforts. In particular, we have not reconciled our expectations as to forward-
looking Adjusted EBITDA to net income due to the difficulty in making an accurate projection as to
stock-based compensation expense. Stock-based compensation expense is affected future hiring,
turnover, and retention needs, as well as the future fair market value of our common stock and
performance stock units. In addition, many of our performance stock units are classified as liabilities
which vest upon the achievement of specific performance-based conditions related to the Company's
financial performance over a three-year period, modified based on the Company's Relative Total
Shareholder Return, all of which is difficult to predict and require quarterly adjustments to their fair
value performed by outside specialists. The actual amount of the excluded stock-based
compensation expense will have a significant impact on our GAAP net income; accordingly, a
reconciliation of forward-looking Adjusted EBITDA to net income is not available without
unreasonable efforts.
DASEKE
Daseke defines:
Adjusted EBITDA as net income (loss) plus (i) depreciation and amortization, (ii) interest, (iii) income
taxes, and (iv) other material items that management believes do not reflect our core operating
performance. Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of total revenue.
Adjusted Net Income (Loss) net income (loss) adjusted for material items that management believes
do not reflect our core operating performance. Adjusted Net Income (Loss) per share as Adjusted
Net Income (Loss) available to common stockholders divided by the weighted average number of
shares of common stock outstanding during the period under the two-class method.
Free Cash Flow as net cash provided by operating activities less purchases of property and
equipment, plus proceeds from sale of property and equipment as such amounts are shown on the
face of the Statements of Cash Flows. Free Cash Flow Yield as Free Cash Flow as a percentage of
market value of equity. Adjusted Return on Equity as adjusted net income attributable to common
stockholders as a percentage of market value of equity.
Adjusted Operating Income (Loss) as total revenue less Adjusted Operating Expenses. Adjusted
Operating Expenses as total operating expenses less: material items that management believes do
not reflect our core operating performance. Adjusted Operating Ratio as Adjusted Operating
Expenses, as a percentage of total revenue.
Revenue excluding fuel surcharge as revenue less fuel surcharges.
Net Debt as total debt less cash and cash equivalents.
Rate per mile is the period's revenue less fuel surcharge, brokerage and logistics revenues divided by
total number of company and owner-operator miles driven in the period. Revenue per Tractor is the
period's revenue less fuel surcharge, brokerage and logistics revenues divided by the average number
of tractors in the period, including owner-operator tractors.
Industry and Market Data
This presentation includes market data and other statistical information from third party sources,
including independent industry publications, government publications and other published
independent sources. Although Daseke believes these third-party sources are reliable as of their
respective dates, Daseke has not independently verified the accuracy or completeness of this
information.
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