Radiant Logistics, Inc.
Q3 2015 Earnings Call Transcript

Published: 19 May 2015

[Operator:]

Greetings and welcome to today’s teleconference. This afternoon, Bohn Crain, Radiant Logistics’ Founder and CEO and Radiant’s Chief Financial Officer, Todd Macomber, will discuss financial results for the company’s third fiscal quarter and nine months ended March 31, 2015 and will provide an update on the recent acquisition of Wheels Group. Following their comments, we will open the call to questions. This conference is scheduled for 30 minutes. This conference call may include forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. The company has based these forward-looking statements on its current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about the company that may cause the company’s actual results or achievements to be materially different from the results or achievements expressed or implied by such forward-looking statements. While it is impossible to identify all the factors that may cause the company’s actual results or achievements to differ materially from those set forth in our forward-looking statements, such factors include those that have in the past, and may in the future, be identified in the company’s SEC filings and other public announcements, which are available on the Radiant website at www.radiantdelivers.com. In addition, past results are not necessarily an indication of future performance. Now, I’d like to pass the call over to Radiant’s Founder and CEO, Bohn Crain. Thank you. Please go ahead.

[Bohn Crain:]

Thank you, Brenda. Good afternoon, everyone and thank you for joining in on today’s call. We made good progress in delivering growth in both top line revenue and gross margin in our seasonally slowest quarter of the year ended March 31, 2015. Revenues were up 18.9% to $102.3 million and our net revenues were up 13.3% to $27.1 million. This growth in our gross margin dollars was offset by incremental commissions paid to our operating partners driven principally by the addition of 8 new stations in the comparable year-over-year period, increased personnel costs driven principally by our new company-owned operations in Minneapolis and Philadelphia, increased technology spending in support of our growth plans as well as non-recurring transaction costs related to Wheels and other transactions and processes. As a result, our adjusted EBITDA of $3.3 million was down modestly over the comparable prior year period. We expect future quarters to return to our more typical trend of double-digit growth in adjusted EBITDA. And as a reminder, our results for the quarter ended March 31, 2015 do not include the benefit of the Wheels transaction, which we concluded on April 2 for the benefit of the other transactions currently under consideration. With respect to Wheels, we are happy to report that our integration efforts are on track and Wheels financial results for the quarter ended March 31, 2015 had improved substantially on a comparable year-over-year basis. Based on internal and un-audited management reports for the quarter ended March 31 and excluding non-recurring transaction cost associated with the April 2 transaction, Wheels generated adjusted EBITDA of $1.4 million on revenues of $74.6 million, up $1 million and 275% over the comparable publicly reported prior year period in what was the slowest seasonal quarter for Wheels as well. As a reminder, these results exclude any benefit from the estimated $3 million in annual cost synergies contemplated in connection with the transaction. This is estimated at $1.5 million in contractual reduction and compensation of the founders, $0.5 million in elimination of redundant public company costs and $1 million in cost synergies from facilities consolidations currently underway in Toronto. Further, these numbers exclude any post-closing revenue or cost synergies that we may achieve. We have provided supplemental disclosure of Wheels management reports for the quarter ended March 31, 2015, including a reconciliation of adjusted EBITDA to net income at the end of our earnings release. As we have previously discussed, the Wheels transaction brings us both geographic and service line expansion and uniquely positions us as one of the premier non-asset based third party logistics companies in North America. We are very excited to bring Wheels’ truck and rail brokerage capabilities here in the U.S. and Canada to our operating partners and the end customers that we serve. In this regard, we have begun through a series of regional meetings to introduce our forwarding network to the expanded service offering now available through our acquisition of Wheels and we are very encouraged by the cross-selling opportunities emerging across the combined Radiant-Wheels network. We are maintaining our preliminary guidance for our fiscal year ending June 30, ‘16. Excluding the impact of certain additional acquisitions under consideration, gain on litigation or other extraordinary or non-recurring items for fiscal ‘16, we are projecting adjusted EBITDA in the range of $27.3 million to $31.3 million on approximately $775 million to $825 million in revenues, which equates to adjusted net income available to common shareholders in the range of $10.7 million to $13 million or $0.25 to $0.31 per basic and $0.24 to $0.30 per fully diluted share. Going forward, we will continue to execute our multi-pronged growth strategy that includes both organic and acquisition growth initiatives. As we think about our opportunities for growth through acquisition, we do not see ourselves limited by good quality acquisition opportunities. We have a robust acquisition pipeline. We do not see ourselves limited by access to capital. We continue to have ready access to capital to execute these acquisitions. Our real limiting factor is the rate at which we can onboard and integrate the acquisitions that we make. Historically, all of our acquisitions have been done from our forwarding platform. Through the Wheels acquisition, we will effectively have three platforms from which we can continue to complete tuck-in acquisitions. Our legacy forwarding operations based here in Bellevue, Washington, our bimodal brokerage operations based in Chicago and our Canadian platform based in Toronto. We will continue to cultivate acquisition opportunities across each of these platforms. Assuming we are able to conclude transactions previously identified as permitted transactions by our lenders in connection with the financing of the Wheels transaction, we are also reaffirming our expectation to achieve run rate revenues approaching $1 billion in calendar 2015 and look forward to providing updates on the acquisition front as developments materialize. With that, I will turn it over to Todd Macomber to take us through the more detailed financial results.

[Todd Macomber:]

Thanks, Bohn, and good afternoon everyone. Today, we will be discussing our financial results, including adjusted net income and adjusted EBITDA for the three and nine months ended March 31, 2015. In reviewing net income, for the three months ended March 31, 2015 we reported net income attributable to common stockholders of $825,000 on $102.3 million of revenues or $0.02 per basic and fully diluted share, including a $428,000 gain on change in contingent consideration, $599,000 in acquisition-related expenses, approximately $175,000 in legal costs we anticipated will be non-recurring, and lastly a tax benefit of $41,000 due to reduction in contingent liabilities associated with stock versus asset transactions where the gains associated with these write-downs are excluded from taxable income as well as prior year true-ups from the tax churn. For the three months ended March 31, 2014, we reported net income attributable to common stockholders of $1,137,000 on $86 million of revenues or $0.03 per basic and fully diluted share. This represents a decrease of approximately $312,000 or approximately 27.4% over the comparable prior year period. As we discussed, adjusted net income for the quarter, for the three months ended March 31, 2015, we reported adjusted net income attributable to common stockholders of $1,251,000 or $0.04 per basic and $0.03 per fully diluted share. For the three months ended March 31, 2014, we reported adjusted net income attributable to common stockholders of $1,428,000 or $0.04 per basic and fully diluted share, a decrease of approximately $176,000 or about 12.4%. Moving on to adjusted EBITDA for the quarter, we reported adjusted EBITDA of $3,343,000 for the three months ended March 31, 2015 compared to adjusted EBITDA of $3,503,000 for the three months ended March 31, 2014. This represented a modest decrease of $160,000 or approximately 4.6%. Looking at the nine month results, for net income, for the nine months ended March 31, 2015, we reported net income attributable to common stockholders of $2,161,000 on $306.4 million of revenues or $0.06 per basic and fully diluted share, including a $1,149,000 gain on change in contingent consideration offset by $395,000 charge for lease termination costs. For the nine months ended March 31, 2014, we reported net income attributable to common stockholders of $2,424,000 on $246.9 million of revenues or $0.07 per basic and fully diluted share. This included a $1,358,000 gain on change in contingent consideration. This represents a decrease of approximately $262,000 or approximately 10.8% in the comparable prior year period. In reviewing adjusted net income for the nine months period ending March 31, 2015, we reported adjusted net income attributable to common stockholders of $4,320,000 or $0.12 per basic and fully diluted share. For the nine months ended March 31, 2014, we reported adjusted net income attributable to common stockholders of $4,745,000 or $0.14 per basic and $0.13 per fully diluted share, a decrease of approximately $425,000 or approximately 9%. In reviewing adjusted EBITDA, we reported adjusted EBITDA of $10,771,000 for the nine months ended March 31, 2015 compared to adjusted EBITDA of $10,254,000 for the nine month period ending March 31, 2014. This represents an increase of approximately $517,000 or about 5% over the comparable prior year period. With that, I will turn the call back over to our moderator to facilitate any Q&A from our callers.

[Operator:]

Thank you. [Operator Instructions] Our first question is from the line of Jason Seidl with Cowen and Company. Please go ahead with your question.

[Jason Seidl:]

Thank you, operator. Hey, Bohn. Thanks for the time today guys. Couple of quick questions. One, you reaffirmed your guidance which I think in a sort of questionable transportation market is a good thing, but my question to you is does the guidance that you gave include some of those cost savings which you mentioned before in the Wheels transaction?

[Bohn Crain:]

It does include the $3 million, which were really kind of factored in as we kind of structured the original transaction. So, the $1.5 million in contractual reduction and founders comp, the redundant op co costs and the facilities, so that $3 million is counted. What’s not counted is any revenue or cost synergies beyond that, which...

[Jason Seidl:]

And I see now you are reading my mind for the next question. Talk a little bit about – obviously, it’s early days, but what are you seeing in terms of the opportunities to generate revenue synergies between Wheels and your existing operations?

[Bohn Crain:]

So, I guess a little bit of background. So, we are in the middle of doing a series of regional meetings. So two weeks ago, we were in New Jersey. This last week and weekend, we were in Chicago. And the week after next, we will be in Los Angeles. And as part of those meetings, we basically invite in all of our operating partners within that region to come join us for kind of updates on the business and some internal meetings. And as part of those meetings kind of the main focus and thrust of this particular set of gathering to us to really introduce the Wheels leadership team and the capabilities back to the network. And so, those things are kind of transpiring or we are kind of two-thirds of the way through that process, but it was interesting because by the time we got to Chicago for our second meeting, we already had six or eight examples of new incremental pieces of business, where the East Coast stations having had the opportunity to meet the folks, had reached out and begun to book loads and take advantage of the Wheels capabilities, both in – we have examples both in Canada as well as on the truck brokerage side. So kind of the meet and greet wasn’t a week old and we were already seeing some good traction taking place. And candidly we expect that momentum to just continue to build upon itself as we kind of work our way across the country. And as the network itself has the successes in working across the aisle if you will, I think that will just kind of continue to reaffirm this good behavior that we are looking for within the organization.

[Jason Seidl:]

Okay, that’s a great color. I think the next question is going to be really – if you can look at your divisions a little separately between Washington, Chicago and Toronto as you kind of mentioned this potential platform for acquisitions. Number one, how does the base business look right now if you sort of remove the growth through the acquisition? And number two, talk about what types of acquisitions you are looking for each of them to grow of?

[Bohn Crain:]

Yes. So, in terms of the base business, obviously, this most recent quarter was a little bit of a mixed bag and that we – it was one of the better quarters in terms of delivering revenue and gross margin growth. So, we had a really positive story to tell there. And then kind of – we didn’t get as many of those gross margin dollars to the bottom line as we had hoped this particular quarter, a whole host of contributing factors from Wheels, transaction cost beefing up some of our IT spend and some of the incremental personnel cost associated with the growth, but we expect to kind of get that back online in the right trend. We know where we need to focus to get that kind of back on track where we would expect it to be. And obviously, on a comparable year-over-year basis, with the benefit of Wheels and on a comparative year-over-year basis, we are going to be posting some pretty extraordinary results here in the coming quarters with the benefit of Wheels. As we on-boarded the Wheels – there is a couple of different comments around the two components. As we – I am going to start on I guess on the organic side, which is – and this will take a little longer to germinate, but it’s very top of mind for me and that is, we have long believed the same value proposition that has found such traction in the agent-based freight forwarding community we think that will also resonate within the agent-based truck brokerage community. And now with Chicago as that platform, we are anxious to test that theory and begin to get out there and see if we can’t make some progress in the brokerage community with the brand promise of liquidity and exit strategy for these smaller guys of having them plug into our network. So, that’s certainly a piece of what we are up to and what we hope to accomplish. On the acquisition side of things, we have certainly alluded to a few in the press release. And then in fact we have a few that have already have been approved by our lenders and designated as permitted transactions and we have kind of secured that approval in connection with the financing of Wheels to begin with. And those particular opportunities are in our – what I would call our core legacy forwarding business. These were M&A opportunities that we have been cultivating for a long, long time. And it just so happened, the Wheels transaction came along and got concluded before we got these next few things over the [build] [ph] line. So in one sense, I would – it’s my hope and expectation that before too long, we will be able to share kind of more good news on the M&A front that would really just be a continuation of our core and base strategy that we began back in 2006. And then over the intermediate and longer term, I think you should continue to see us doing things in the forwarding space, while also trying to make further progress leveraging these other platforms on the brokerage side as well as up in Canada.

[Jason Seidl:]

Now, Bohn that’s great color again, but as you look at sort of the makeup of the industry, obviously M&A has been picking up of late and just some very large transactions, you guys have been involved in sort of rolling things up for a while now. Do you think that smaller carriers or – and providers are looking at this and basically saying it’s either grow it our self or we got to be acquired because this is sort of how the game plan is going to work in this industry?

[Bohn Crain:]

Well, it’s fair to say there is a lot of M&A going on, but ultimately you have to be in the right place at the right time with the right value proposition for folks. I do think we have and remain uniquely positioned in the marketplace with what we are doing. We have got effectively a 10-year head start than anybody else who does, that’s for sure try to pursue what we are doing. So I feel really good about kind of where we are. The pipeline remains robust. I think I know we are – as someone looking for a partner with which – a partner to partner with, it’s a lot easier to make a decision to partner with Radiant Logistics today than it was in 2006 when we were just getting started. And so we do – we are finding ourselves in more and more and more interesting opportunities as we have scaled our business. And while we are going to stay true to – or not a little side of the importance of organic growth, it is fair to say that we would at least – we are going to endeavor to increase the rate at which we do M&A.

[Jason Seidl:]

Okay. Well, listen I appreciate the time that you guys have given us always. And I want to thank everyone else at this time. So congratulations on the closing of the deal and we look forward to seeing the next one.

[Operator:]

Thank you. And our next question comes from the line of Marco Rodriguez with Stonegate. Please go ahead with your question.

[Marco Rodriguez:]

Good afternoon guys. Thanks for taking my questions. I wanted to kind of follow-up here again on the Wheels acquisition. Maybe Bohn, if you could talk a little bit about the integration aspect, kind of like a timeline and what steps you have been taking or will be taking in the near future here?

[Bohn Crain:]

Sure. Well, there is I guess a couple of components of that kind of in connection with the transaction itself, we were able to capture some big dollar cost synergies in connection with the transitioning of the founders. So that’s kind of well underway. I think if you may remember, we will – a little bit of backdrop, right. So Wheels itself was the product that’s in M&A. They had multiple facilities in Toronto and we are in the middle of integrating or consolidating facilities in Toronto. All of that is on target to be completed in the month of June and so we will get everybody under one roof in Toronto. We anticipate that’s going to unlock another $1 million in cost synergies. And then we are working through kind of what I will call the next basket, which is redundant op co cost as we are aligning D&O or insurances and auditors and tax fees and delisting on the Toronto Exchange and some of those other areas. And we are on the front side of some of the more fun and interesting work, which is going after more of the revenue synergies, which is kicking off to these regional meetings. Unlike when we acquire other agent-based forwarding networks like Adcom and Distribution By Air and there were big redundant back office cost takeouts. That’s really – as we talked about before that’s really not the case here because we are really intending on operating Chicago as its own operating division with its own back office infrastructure. We will be doing some work over time on the IT side to get things hopefully better integrated there. But I think beyond the $3 million that we have identified, we are really looking more for revenue synergies than big cost takeouts per se. And – but again, it’s been very energizing to bring folks together and see them kind of make these connections and begin to leverage each other’s capabilities. And I think that’s going to carry us perhaps farther than we might have even expected. But it’s awfully early in the process to draw conclusions, but all early indications are extremely positive.

[Marco Rodriguez:]

Got it. So is it fair that to say that here the facility consolidation you said will be done by June, the public costs, it doesn’t sound like that would take too long, so you probably have those $2 million savings by the end of year fiscal ‘15?

[Bohn Crain:]

Yes. I think that’s certainly how I am thinking about it.

[Marco Rodriguez:]

Got it. And then kind of in terms of the revenue synergies and these regional meetings that you are presenting here to your current network or the Radiant network, can you talk a little bit more – I mean, is it just a meet and greet or the people that are attending these, do they need special training, do they pass off the sales opportunity once they talk to a potential client, can you talk a little bit about the sales aspect?

[Bohn Crain:]

Well, it takes a lot of different flavors, right. So ultimately, there is not necessarily training involved, but it’s to be able to have – candidly, to have these folks from Wheels stands up and address our group and talk about their capabilities, the types of customers that they are currently servicing and the dollar volume of business they are doing across truck and rail brokerage is, this is a new world for our guys on the forwarding side of the house. And they look pretty interesting, just in some of the meetings to watch people go, Oh my goodness, I have got a – I have a customer relationships, who I know have some challenges in Canada. Are you available next Tuesday at 4 o'clock to get on a call with this customer, so we can walk through and talk about how we can help them? And that storyline is really just repeating itself over and over again as people have the opportunity to understand these incremental capabilities. And then set that up against what they know to meet some of the needs and challenges of their existing customer base.

[Marco Rodriguez:]

And are there any sort of meetings that are similar to this that are going on with the Wheels individuals, so that they are more familiar with your specific offerings?

[Bohn Crain:]

Well, let’s say it’s ultimately it’s the same group. So the – so that is just a two-way exchange. But certainly, we are – and this is driven in part by kind of our long-term view that we have wanted a truck brokerage platform to act as a capacity provider back to our forwarding network. You have heard me talk about that for years, right, so at least that’s out of the gate here. We are really – the primary focus is how can we further differentiate ourselves in the marketplace and with our existing customer base where we already have good credibility and access to the decision makers to show them the new and incremental tools we have in the toolbox to help them.

[Marco Rodriguez:]

Got it. And then a modeling question here, just kind of looking at your guys guidance, your historical performance as well as obviously, Wheels’ historical performance, just trying to get a better handle on how some of the cost structures are going to look like going forward? It kind of looks like your blended gross margins will probably be dropping from somewhere from the upper 20% range to the mid to lower 20% range. Is that fair? And also, how should we be thinking about how the agent commissions, personnel costs and SG&A costs move around once the Wheels is finally in the system here for your June quarter and going on?

[Bohn Crain:]

Well, that was a great detailed question and I am going to happily pass the baton to Todd.

[Todd Macomber:]

Well, the margins I think are going to come down a little bit. I mean, we have spent a lot of time putting that model together. So, it will come down. As it relates to the agent-based commissions, Marco, that’s really the network that we have here. It doesn’t really apply as much to Wheels. So, those as a percent of gross margins is going to come down. And then depending upon the acquisitions, how we layer those things on is ultimately what’s going to – how fiscal year ‘16 is going to end up looking. But yes, you are absolutely correct in regards to the margin….

[Bohn Crain:]

Yes. And let me hop in. I am going to give you kind of an anecdotal comment. So, I am not going to give you precise percentage, but I think it will at least help you begin to frame how you would think about it and that is on a pre-Wheels basis, if we looked at gross margin and try to attribute that between company-owned and agent-based stations, about 25% of our gross margins were generated from company-owned locations. That’s pre-Wheels. So, on a combined basis, basically 100% of the Wheels is going to be company-owned stores. So, we are going to see a marked – on a fully consolidated basis, a demonstrable move, it’s not 50%, but certainly approaching 50% of our aggregate gross margins are going to be controlled out of the company-owned locations. And then the second kind of aspect of your question is that, ultimately, the agent commissions will be somewhat impacted by the rate at which we buy in and convert agent stations to company-owned stores. And so that will be just another variable as we move through time and continue to execute our plan.

[Marco Rodriguez:]

Got it. I appreciate the color guys. Thanks a lot.

[Operator:]

Thank you. And our next question comes from the line of Jeff Martin with ROTH Capital Partners. Please go ahead with your question.

[Jeff Martin:]

Thanks. Hey, Bohn. Hi, Todd.

[Bohn Crain:]

Hi, Jeff.

[Jeff Martin:]

Bohn, could you give us an update on just kind of the bigger picture business trends and geographic mix, pricing mix? You have had regionalized managers responsible for driving organic growth initiatives, an update on those things would be helpful?

[Bohn Crain:]

Yes. Where do I begin with that one? I think all in all, we are still pretty bullish about business. I know there has been a little bit of negative sentiment, I guess you would call it on some of the truckload or asset-based guys and capacity maybe not being as tight as what people might have thought that it was going to be. But that has a non-asset based guy that hasn’t negatively affected our world. So, I don’t – I am not in a – I don’t feel comfortable acting as the economist, but I can tell you just from our little view on the world, we feel good about where we are, where we are going, and we seem to be winning more than our fair share of business out there. And I think that we talked about scale and size and kind of some of the financial aspects of that, but it’s an intangible. But I also think as we continued to grow and scale, it also helps us on the customer-facing side of things. We might have talked about this on one of the prior calls. But if we look and kind of segment the business by relative size of companies, there is a handful of multi-billion dollar companies and a handful of $300 million to $500 million companies, but there is this huge gap between the smaller guys and the really big guys. And we are on a path – if we are not there already, we are on a path where we are going to be out there and kind of in that – in between those largely unaccompanied. And so we think that’s going to continue to kind of provide a good landscape or relative competitive positioning as we are trying to continue to grow and attract more operating partners and drive new organic growth to the platform.

[Jeff Martin:]

Okay, great. And then in that revenue guidance range you gave, what is the embedded organic growth rate of the combined businesses that’s assumed in that guidance?

[Todd Macomber:]

That was 3.5%, 4%.

[Jeff Martin:]

Okay, great. And then currencies moved around a little bit with Canadian dollar weakening, are you just basically assuming that it comes back down? It’s not too far below where it was in January when you announced the Wheels acquisition. Are you assuming it just kind of comes back down to that level within your guidance?

[Todd Macomber:]

Yes, that’s what we were expecting. Obviously, it’s very difficult to know what we have done with the anticipation, yes.

[Bohn Crain:]

And I guess just one other little asterisk relative to that just to kind of remind folks, but Wheels itself, about 50% of their business is U.S. based, denominated in U.S. dollars. So, although you are absolutely correct that, that kind of FX is going to be – become a feature and component of our conversation going forward, it’s not as big as you might think because – again, Chicago and in essence, California business is already denominated in U.S. dollars.

[Jeff Martin:]

Okay, okay. And then Bohn, you have alluded several times to some impending acquisitions, are you able to kind of give a general timeframe when we should expect to hear more on those?

[Bohn Crain:]

Not without getting beat up by my general counsel.

[Jeff Martin:]

Okay, fair enough. Good luck guys.

[Bohn Crain:]

Alright, thank you.

[Todd Macomber:]

Thank you.

[Operator:]

Thank you. And our next question comes from the line of David Campbell with Thompson, Davis & Company. Please go ahead with your question.

[David Campbell:]

Hi, Bohn. Hi, Todd. I just want to ask you quickly if you can give us an interest expense forecast for the fourth quarter of the fiscal ‘15 year through the June ‘15 quarter?

[Bohn Crain:]

Do you happen to know that interest expense number?

[Todd Macomber:]

I don’t have the [indiscernible].

[Bohn Crain:]

I think and Todd, correct me if I am wrong, I think you can look at our full year guidance for ‘16, and just take a quarter of that. That could be a pretty good proxy, because that was...

[Todd Macomber:]

I would agree.

[Bohn Crain:]

Baked in for being – existing leverage based on the current platform.

[David Campbell:]

Is that in the press release, the ‘16 interest expense?

[Bohn Crain:]

Yes. And there is a whole series of kind of financial statement attachments and one of them is the outlook.

[David Campbell:]

Okay, okay. And is there any opportunity for increasing Wheels’ gross margin percentage either as a result of the merger or any other reason?

[Bohn Crain:]

I would think, I mean, intuitively I don’t know that absolute gross margin is going to go up necessarily, but I think they are going to have the same kind of benefit of scale as we do that’s kind of in the core reporting segment. So, they have a fixed cost structure there to service the accounts. And as we can push more business across their platforms, they are going to kind of enjoy the same benefits that we do. And they will get – as they continue to scale, we should see more and more of those gross margin dollars getting to the bottom line as we scale.

[David Campbell:]

Good. It will be a function of growth more than a function of merging the two companies?

[Bohn Crain:]

I think that’s right.

[David Campbell:]

Okay. And the last question is do you have an organic growth number for the third quarter, the March quarter?

[Todd Macomber:]

We do. It was around 3.5% organic growth on a net revenue basis.

[David Campbell:]

3.5% net revenues?

[Todd Macomber:]

Yes.

[David Campbell:]

Okay. That’s all I have. Thank you very much.

[Bohn Crain:]

You bet.

[Operator:]

Thank you. And it seems that we have no further questions at this time. I would like to turn the floor back over to management for any additional remarks.

[Bohn Crain:]

Alright, thank you. Let me close by saying that we remain very excited with our progress and prospects here at Radiant and we remain very bullish on the growth platform we have created and the scalability of our non-asset based business model. We continue to make good progress in executing our strategy, leveraging the Radiant platform to bring value to our operating partners. And we remain very excited about the opportunity to grow our business organically, both on a same-store and new store basis and by completing acquisitions of other companies that bring critical mass from a geographic standpoint, incremental purchasing power and/or complementary service offerings, which will benefit the broader network. At the right place, at the right time, with the right value proposition, we look forward to reporting further progress in terms of both organic and acquisition initiatives in the quarters ahead. Thanks for listening and your support of Radiant Logistics.

[Operator:]

Thank you, ladies and gentlemen. This concludes today’s teleconference. You may disconnect your lines at this time and thank you for your participation.