Hub Group, Inc. (HUBG) Earnings Call Transcript & Summary

Welcome to the 2021 Annual Meeting of Hub Group, Inc.'s shareholders. I would now like to introduce the first presenter, David Yeager, Chairman and CEO of Hub Group, Inc.

Good morning, and welcome to the 2021 Annual Stockholders' Meeting of Hub Group. I'm David Yeager, Chairman and Chief Executive Officer. It's my pleasure to welcome you today. These have been and continue to be challenging times. In that regard, we're pleased to be hosting our second virtual Annual Meeting. Regarding the business of the meeting, the agenda is available via the web portal. The meeting will take place as described in the agenda. It's now 10:00 a.m. Central Time on May 24. And this meeting is officially called to order. I would first like to introduce the other nominees for election to the Board who are attending today's meeting. Peter McNitt, our lead Independent Director and retired Vice Chairman of BMO Harris Bank; Martin Slark, retired CEO of Molex Inc; Mary Boosalis, President and Chief Executive Officer of Premier Health; James Kenny, former U.S. ambassador to Ireland; Charles Reaves, President and CEO of Reaves Enterprises; Jon Ward, operating partner at Kohlberg & Company; and Jenell Ross, President of the Bob Ross Automotive Group. I would also like to introduce [ Jeannie Adamson ] and [ Blake Delhis ], representatives from Ernst & Young, our independent auditors. We indicated in our proxy statement that representatives of Ernst & Young would be available to respond to appropriate questions and to make a statement if they desired. I'm advised that no stockholder questions have been submitted that were directed to Ernst & Young, and they have advised me that they do not wish to make a statement. Finally, I would also like to announce that Broadridge Financial Services has been appointed to act as inspector of election. Mr. [ Peter Sablich ] from Broadridge is with us today, and has taken his oath. The Board of Directors fixed March 29, 2021, as the record date for determining stockholders entitled to vote at this meeting. I have received an affidavit, which will be made a part of the minutes of today's meeting, that indicates that our proxy materials were appropriately mailed to all record stockholders on or about April 12, 2021. The stockholder list shows that as of the record date, there were 34,426,310 shares of Class A common stock and 662,296 shares of Class B common stock outstanding and entitled to vote at the meeting, representing approximately 90,059,174 votes. As required by Delaware law, a certified list of stockholders as of the record date is available for inspection during the meeting via the virtual portal. I'm informed by the inspector of elections that over 80% of our shares are present in person or by proxy. This constitutes a quorum for purposes of transacting business. Therefore, I declare this meeting duly and validly called, convened and open for business, properly brought before it. It's now 10:04 a.m. Central Time on May 24, 2021. And the polls are now open. Any stockholder who hasn't yet voted or wishes to change their vote, may do so by clicking on the voting button on the web portal and following the instructions there. Stockholders who have sent in proxies or voted via telephone or Internet and do not want to change their vote, do not need to take any further action. The polls for voting will close immediately following the reading of the proposals to be voted upon. Also, stockholders wishing to ask questions or submit comments may do so at this time. Please note that this meeting is being recorded. However, no one attending via the webcast or telephone is permitted to use any audio recording device. Now I present the matters to be voted upon. Proposal 1 is the election Directors. The current Board has nominated David Yeager, Mary Boosalis, James Kenny, Peter McNitt, Charles Reaves, Martin Slark, Jonathan Ward, and Jenell Ross for election as Directors by the company's stockholders. No other nominations have been submitted in accordance with the company's bylaws. I hereby declare nominations closed. Proposal 2 is the advisory vote to approve the compensation of our named executive officers as described in the proxy statement. This vote, also known as say-on-pay, is nonbinding, although the compensation committee and the Board will take the results into account when making future compensation decisions. Proposal 3 is the vote to ratify the appointment of Ernst & Young as our independent registered public accountants for 2021. This is also an advisory vote. While voting takes place, I'll make a few remarks. The year 2020 was one of the most challenging in recent memory. The importance of a strong supply chain was front and center, and Hub Group's drivers and office employees delivered when our customers needed it most. Our corporate response to the pandemic was early and swift. We admittedly activated our business continuity plan, developed protocols and supply the necessary PPE to protect the health and safety of our workforce as well as that of our valued customers and suppliers. Additionally, in support of COVID-19 relief efforts, helped donated $6 million of equipment to hospitals and food banks. Our team maintained its commitment to providing a world-class customer experience during this difficult time. We managed through the COVID-induced economic softness in the spring of 2020 and grew with our highly valued customers. We then met the challenge of a shift to a strong demand environment, leading to a 9% increase in intermodal volume and a 4% overall revenue growth in the second half of the year. We continue to invest in our business, adding both containers and new energy-efficient tractors while continuing our heavy investment in technology. Meanwhile, our efforts to reduce costs resulted in us achieving our 2020 goal of annualized savings of $40 million. We continue to identify additional cost reduction opportunities this year. In addition, we continue to diversify our non-asset-based product offerings. In December, we acquired NonstopDelivery, which expanded our service offering into the fast-growing last mile delivery space. Our service offerings deliver a compelling combination of value and performance while enabling our customers to reduce their carbon footprint. My parents, Phil and [ Joy Yeager], founded Hub Group 50 years ago with a vision for providing the best service in the industry at the highest level of integrity. Much has changed since then, but Hub Group's core values of service, integrity and innovation remain unchanged. Thank you to our shareholders for being a part of Hub Group's first 50 years. We appreciate your support, and look forward to the next 50. Everyone has now had the opportunity to vote. And I now declare the polls for the 2021 Hub Group Annual Stockholder Meeting closed at 10:08 a.m. Central Time on May 24, 2021. I've been informed by the inspector of election that the preliminary vote report shows that all nominees for election to the Board have been duly elected, the compensation of the named executive Officers has been approved, and the selection of Ernst & Young as the company's registered independent accounting firm has been approved. We will be reporting the final vote results in a current report on Form 8-K to be filed with the Securities and Exchange Commission within 4 business days following this meeting. Therefore, I declare David Yeager, Mary Boosalis, James Kenny, Peter McNitt, Charles Reaves, Martin Slark, Jonathan Ward and Jenell Ross to be duly elected as Directors of Hub Group to serve until the successors are elected and qualified. I also declare the compensation to our named executive Officers and the selection of Ernst & Young as our auditors approved on an advisory basis by the stockholders. There will be no further business. The 2021 Annual Meeting of the Stockholders of Hub Group is now adjourned. Thank you for attending.