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The Brokerage segment continues to provide additional selectivity for the Company’s assets to optimize yield while at the same time offering more capacity solutions to customers. Brokerage segment revenue increased to $56.0 million in the third quarter of 2020 compared to $46.0 million in the third quarter of 2019, primarily as a result of increased revenue per load and to a lesser extent an increase in load count.  Brokerage operating loss was $4.5 million in the third quarter of 2020 as compared to an operating loss of $0.1 million in the year ago quarter.  The Company continues to work on sequentially improving margins in this division.

Liquidity and Capital Resources

At the end of the third quarter 2020, the Company had $154.9 million of liquidity (defined as cash plus availability under the Company’s revolving credit facility), $386.3 million of net debt (defined as long-term debt, including current maturities, less cash balances), and $252.2 million of total stockholders' equity.

The Company expects its net capital expenditures to approximate $100 to $120 million for the full year of 2020, which includes an approximate $20 million transaction that carried over from the fourth quarter of 2019. Through September 30, 2020, net capital expenditures were $95.3 million including the carryover $20 million from 2019.

Outlook

The Company’s baseline assumptions for the balance of 2020 include a general sequential economic recovery that may be volatile nationally or by region at times, increasing inventory re-stocking, tight trucking capacity, and a relatively benign cost inflation outside of driver-related and insurance premium expenses.  These conditions are expected to continue to support spot market rates in excess of contract rates and a strengthening contract renewal environment over the next several quarters. Based on these assumptions, the Company expects its internal initiatives around digitization and cost management, combined with continued strength in Dedicated, to have U.S. Xpress well positioned to continue improving its margins through 2021.

Conference Call

The Company will hold a conference call to discuss its third quarter results at 5:00 p.m. (Eastern Time) on October 22, 2020.  The conference call can be accessed live over the by phone dialing 1-877-423-9813 or, for international callers, 1-201-689-8573 and requesting to be joined to the U.S. Xpress Third Quarter 2020 Earnings Conference Call. A replay will be available starting at 8:00 p.m. (Eastern Time) on October 22, 2020, and can be accessed by dialing 1-844-512-2921 or, for international callers, 1-412-317-6671. The passcode for the replay is 13711865. The replay will be available until 11:59 p.m. (Eastern Time) on October 29, 2020.

Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the investor relations section of the Company’s website at investor.usxpress.com. The online replay will remain available for a limited time beginning immediately following the call. Supplementary information for the conference call will also be available on this website.

(1) Non-GAAP Financial Measures

Pursuant to the requirements of Regulation G and Regulation S-K, we have provided reconciliations of Adjusted Operating Ratio, Adjusted Operating Income, Adjusted Net Income Attributable to Controlling Interest, and Adjusted EPS to the most comparable GAAP financial measures at the end of this press release.

About U.S. Xpress Enterprises

Founded in 1985, U.S. Xpress Enterprises, Inc. is the nation’s fifth largest asset-based truckload carrier by revenue, providing services primarily throughout the United States. We offer customers a broad portfolio of services using our own truckload fleet and third‐party carriers through our non‐asset‐based truck brokerage network. Our modern fleet of tractors is backed up by a team of committed professionals whose focus lies squarely on meeting the needs of our customers and our drivers.

Forward-Looking Statements

This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such statements may be identified by their use of terms or phrases such as "expects," "estimates," "projects," "believes," "anticipates," "plans," "intends," “outlook,” “strategy,” “optimistic,” “will,” “could,” “should,” “may,” “focus,” “seek,” “potential,” “continue,” “goal,” “target,” “objective,” derivations thereof, and similar terms and phrases.  In this press release, such statements may include, but are not limited to, statements in the "Outlook" section, statements regarding the freight environment, expected rates, expected margins, future growth of our digital fleet and Dedicated division, expected net capital expenditures, the expected impact of our driver, digital fleet, and other initiatives, and any other statements concerning: any projections of earnings, revenues, cash flows, capital expenditures, compliance with financial covenants, or other financial items; any statement of plans, strategies, or objectives for future operations; any statements regarding future economic or industry conditions or performance; any statements regarding our responses to COVID-19 and the associated economic conditions; and any statements of belief and any statements of assumptions underlying any of the foregoing. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. The following factors, among others, could cause actual results to differ materially from those in the forward-looking statements: general economic conditions, including inflation and consumer spending; political conditions and regulations, including future changes thereto; changes in tax laws or in their interpretations and changes in tax rates; future insurance and claims experience, including adverse changes in claims experience and loss development factors, or additional changes in management's estimates of liability based upon such experience and development factors that cause our expectations of insurance and claims expense to be inaccurate or otherwise impacts our results; impact of pending or future legal proceedings; future market for used revenue equipment and real estate; future revenue equipment prices; future capital expenditures, including equipment purchasing and leasing plans and equipment turnover (including expected trade-ins); fleet age; future depreciation and amortization; changes in management’s estimates of the need for new tractors and trailers; future ability to generate sufficient cash from operations and obtain financing on favorable terms to meet our significant ongoing capital requirements; our ability to maintain compliance with the provisions of our credit agreement; freight environment, including freight demand, rates, capacity, and volumes; future asset utilization; loss of one or more of our major customers; our ability to renew dedicated service offering contracts on the terms and schedule we expect; surplus inventories, recessionary economic cycles, and downturns in customers' business cycles; strikes, work slowdowns, or work stoppages at the Company, customers, ports, or other shipping related facilities; increases or rapid fluctuations in fuel prices, as well as fluctuations in surcharge collection, including, but not limited to, changes in customer fuel surcharge policies and increases in fuel surcharge bases by customers; interest rates, fuel taxes, tolls, and license and registration fees; increases in compensation for and difficulty in attracting and retaining qualified professional drivers and independent contractors; seasonal factors such as harsh weather conditions that increase operating costs; competition from trucking, rail, intermodal, and brokerage (including digital brokerage) competitors; regulatory requirements that increase costs, decrease efficiency, or reduce the availability of drivers, including revised hours-of-service requirements for drivers and the Federal Motor Carrier Safety Administration’s Compliance, Safety, Accountability program that implemented new driver standards and modified the methodology for determining a carrier’s Department of Transportation safety rating; future safety performance; our ability to reduce, or control increases in, operating costs; future third-party service provider relationships and availability; execution of the Company’s current business strategy or changes in the Company’s business strategy; the ability of the Company’s infrastructure to support future organic or inorganic growth; our ability to identify acceptable acquisition candidates, consummate acquisitions, and integrate acquired operations; our ability to adapt to changing market conditions and technologies, including the future use of autonomous tractors; disruptions to our information technology; the cost of and our ability to effectively and efficiently implement technology initiatives; costs, diversion of management’s attention, and potential payments made in connection with the multiple class action lawsuits a stockholder derivative lawsuit arising out of our IPO;  changes in methods of determining LIBOR or replacement of LIBOR; credit, reputational and relationship risks of certain of our current and former equity investments; risks arising from our Mexican operations; our ability to maintain effective internal controls without material weaknesses, as well as remediate the existing material weakness; and the impact of the recent coronavirus outbreak or other similar outbreaks. Readers should review and consider these factors along with the various disclosures by the Company in its press releases, stockholder reports, and filings with the Securities and Exchange Commission. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.

USX Financial

Contact:

U.S. Xpress Enterprises, Inc.

Brian Baubach

Sr. Vice President Corporate Finance and Investor Relations
investors@usxpress.com

Source: U.S. Xpress Enterprises, Inc.

Condensed Consolidated Income Statements (unaudited)
		Quarter Ended September 30,								Nine Months Ended September 30,
(in thousands, except per share data)		2020				2019				2020				2019
Operating Revenue:
Revenue, excluding fuel surcharge		$	403,679			$	386,666			$	1,190,463			$	1,133,162
Fuel surcharge			27,790				41,837				96,051				124,566
Total operating revenue			431,469				428,503				1,286,514				1,257,728
Operating Expenses:
Salaries, wages and benefits			137,541				134,862				412,889				389,907
Fuel and fuel taxes			33,208				47,315				103,265				141,252
Vehicle rents			20,956				19,470				64,168				57,025
Depreciation and amortization, net of (gain) loss			25,785				26,684				77,871				74,498
Purchased transportation			125,997				122,433				373,117				349,017
Operating expense and supplies			33,927				36,147				101,249				104,744
Insurance premiums and claims			17,835				19,570				65,141				63,189
Operating taxes and licenses			3,359				3,533				10,756				10,112
Communications and utilities			2,187				2,209				6,895				6,659
Gain on sale of subsidiary			-				-				-				(670	)
General and other operating			14,783				12,998				42,663				37,288
Total operating expenses			415,578				425,221				1,258,014				1,233,021
Operating Income			15,891				3,282				28,500				24,707
Other Expenses (Income):
Interest Expense, net			4,381				5,467				14,664				16,366
Equity in loss of affiliated companies			-				91				-				270
Other, net			-				-				2,000				26
			4,381				5,558				16,664				16,662
Income Before Income Taxes			11,510				(2,276	)			11,836				8,045
Income Tax Provision			1,337				(813	)			1,867				1,503
Net Income (Loss)			10,173				(1,463	)			9,969				6,542
Net Income (Loss) attributable to non-controlling interest			(523	)			(17	)			(1,009	)			595
Net Income (Loss) attributable to controlling interest		$	10,696			$	(1,446	)		$	10,978			$	5,947
Income Per Share
Basic earnings (loss) per share		$	0.22			$	(0.03	)		$	0.22			$	0.12
Basic weighted average shares outstanding			49,667				48,984				49,462				48,709
Diluted earnings (loss) per share		$	0.20			$	(0.03	)		$	0.20			$	0.12
Diluted weighted average shares outstanding			51,194				48,984				50,493				49,289

Condensed Consolidated Balance Sheets (unaudited)
		September 30,				December 31,
(in thousands)		2020				2019
Assets
Current assets:
Cash and cash equivalents		$	7,422			$	5,687
Customer receivables, net of allowance of $185 and $63, respectively			190,644				183,706
Other receivables			16,345				15,253
Prepaid insurance and licenses			23,073				11,326
Operating supplies			8,249				7,193
Assets held for sale			25,623				17,732
Other current assets			16,405				15,831
Total current assets			287,761				256,728
Property and equipment, at cost			900,719				880,101
Less accumulated depreciation and amortization			(397,263	)			(388,318	)
Net property and equipment			503,456				491,783
Other assets:
Operating lease right-of-use assets			280,687				276,618
Goodwill			59,221				57,708
Intangible assets, net			25,938				27,214
Other			33,979				30,058
Total other assets			399,825				391,598
Total assets		$	1,191,042			$	1,140,109
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		$	77,646			$	68,918
Book overdraft			-				1,313
Accrued wages and benefits			32,095				24,110
Claims and insurance accruals			51,571				51,910
Other accrued liabilities			7,483				9,127
Current portion of operating leases			74,357				69,866
Current maturities of long-term debt and finance leases			111,232				80,247
Total current liabilities			354,384				305,491
Long-term debt and finance leases, net of current maturities			282,453				315,797
Less debt issuance costs			(325	)			(1,223	)
Net long-term debt and finance leases			282,128				314,574
Deferred income taxes			22,236				20,692
Other long-term liabilities			18,710				5,249
Claims and insurance accruals, long-term			55,174				56,910
Noncurrent operating lease liability			206,190				206,357
Commitments and contingencies			-				-
Stockholders' Equity:
Common Stock			496				490
Additional paid-in capital			260,365				250,700
Accumulated deficit			(10,004	)			(20,982	)
Stockholders' equity			250,857				230,208
Noncontrolling interest			1,363				628
Total stockholders' equity			252,220				230,836
Total liabilities and stockholders' equity		$	1,191,042			$	1,140,109