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What changed in UNIVERSAL LOGISTICS HOLDINGS, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of UNIVERSAL LOGISTICS HOLDINGS, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+189 added−196 removedSource: 10-K (2025-03-17) vs 10-K (2024-03-15)

Top changes in UNIVERSAL LOGISTICS HOLDINGS, INC.'s 2024 10-K

189 paragraphs added · 196 removed · 141 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeFor additional information on segments, see Item 8, Note 17 to the Consolidated Financial Statements. Business and Growth Strategy The key elements of our strategy are as follows: Make strategic acquisitions.
Biggest changeParsec also provides crane and intermodal equipment repair, drayage, and container and chassis stacking. The operating results of Parsec are reported as part of our Contract Logistics segment beginning in the third quarter of 2024. For additional information on Parsec and other acquisitions, see Item 8, Note 5 to the Consolidated Financial Statements.
We believe diversity and inclusion are critical to our ability to win in the marketplace and enable our workforce and communities to succeed. Specifically, having a diverse and inclusive workplace allows us to attract and retain the best employees to deliver results for our shareholders.
Diversity and Inclusion . We believe diversity and inclusion are critical to our ability to win in the marketplace and enable our workforce and communities to succeed. Specifically, having a diverse and inclusive workplace allows us to attract and retain the best employees to deliver results for our shareholders.
We intend to capitalize on continued growth opportunities in those outsourced, higher-value logistics services, such as sub-assembly and sequencing, which link directly into production lines and require specialized capabilities, technological expertise, and strict quality controls. 5 Continue to expand penetration in other vertical markets .
We intend to capitalize on continued growth opportunities in those outsourced, higher-value logistics services, such as sub-assembly and sequencing, which link directly into production lines and require specialized capabilities, technological expertise, and strict quality controls. Continue to expand penetration in other vertical markets .
Any significant disruption or failure of these systems could have a materially adverse effect on our operations and financial results. Government Regulation Our operations are regulated and licensed by various U.S. federal and state agencies, as well as comparable agencies in Mexico, Canada, and Colombia.
Any significant disruption or failure of these systems could have a materially adverse effect on our operations and financial results. 7 Government Regulation Our operations are regulated and licensed by various U.S. federal and state agencies, as well as comparable agencies in Mexico, Canada, and Colombia.
The automotive industry is one of the largest users of global outsourced logistics services, providing us growth opportunities with both existing and new customers. In 2023, this sector comprised approximately 43% of our total operating revenues. The vast majority of hourly employees in our automotive customers’ manufacturing operations are represented by unions and covered by collective bargaining agreements.
The automotive industry is one of the largest users of global outsourced logistics services, providing us growth opportunities with both existing and new customers. In 2024, this sector comprised approximately 47% of our total operating revenues. The vast majority of hourly employees in our automotive customers’ manufacturing operations are represented by unions and covered by collective bargaining agreements.
Our agents solicited and controlled approximately 30% of the freight we hauled in 2023, with the balance of the freight being generated by company-managed terminals. Our top 100 agents in 2023 generated approximately 20% of our annual operating revenues.
Our agents solicited and controlled approximately 30% of the freight we hauled in 2024, with the balance of the freight being generated by company-managed terminals. Our top 100 agents in 2024 generated approximately 17% of our annual operating revenues.
ITEM 1: BUSINESS Company Background Universal Logistics Holdings, Inc. is a holding company whose subsidiaries provide a variety of customized transportation and logistics solutions throughout the United States and in Mexico, Canada and Colombia. Our operating subsidiaries provide customers with a broad scope of services across their entire supply chain, including truckload, brokerage, intermodal, dedicated and value-added services.
ITEM 1: BUSINESS Company Overview Universal Logistics Holdings, Inc. is a holding company whose subsidiaries provide customized transportation and logistics solutions throughout the United States and in Mexico, Canada and Colombia. Our operating subsidiaries offer customers a broad range of services across their entire supply chain, including truckload, intermodal, and value-added services.
We also contract with owner-operators to provide greater flexibility in responding to fluctuations in customer demand. Owner-operators provide their own trucks and are contractually responsible for all associated expenses, including but not limited to financing costs, fuel, maintenance, insurance, and taxes, among other things. They are also responsible for maintaining compliance with Federal Motor Carrier Safety Administration regulations.
We also contract with owner-operators to provide greater flexibility in responding to fluctuations in customer demand. Owner-operators provide their own trucks and are contractually responsible for all associated expenses, including but not limited to financing costs, fuel, maintenance, insurance, and taxes, among other things.
Our operating subsidiaries provide a comprehensive suite of transportation and logistics solutions that allow our customers to reduce costs and manage their global supply chains more efficiently.
Our comprehensive suite of transportation and logistics solutions allow our customers to reduce costs and manage their global supply chains more efficiently.
Continue to capitalize on strong industry fundamentals and outsourcing trends . We believe long-term industry growth will be supported by manufacturers seeking to outsource non-core logistics functions to cost-effective third-party providers that can efficiently manage increasingly complex global supply chains.
We believe long-term industry growth will be supported by manufacturers seeking to outsource non-core logistics functions to cost-effective third-party providers that can efficiently manage increasingly complex global supply chains.
Any such adjustments could have a materially adverse effect on our operations and financial results. 7 To reduce our exposure to claims incurred while a vehicle is being operated without a trailer attached or is being operated with an attached trailer which does not contain or carry any cargo, we require our owner-operators to maintain non-trucking use liability coverage (which the industry refers to as deadhead bobtail coverage) of $2.0 million per occurrence.
To reduce our exposure to claims incurred while a vehicle is being operated without a trailer attached or is being operated with an attached trailer which does not contain or carry any cargo, we require our owner-operators to maintain non-trucking use liability coverage (which the industry refers to as deadhead bobtail coverage) of $2.0 million per occurrence.
During the year ended December 31, 2023, we also engaged, on average, the full-time equivalency of 450 individuals on a contract basis. As of December 31, 2023, approximately 33% of our employees were members of unions and subject to collective bargaining agreements. We believe our union and employee relationships are good. Diversity and Inclusion .
As of December 31, 2024, we had 10,821 employees. During the year ended December 31, 2024, we also engaged, on average, the full-time equivalency of 88 individuals on a contract basis. As of December 31, 2024, approximately 46% of our employees were members of unions and subject to collective bargaining agreements. We believe our union and employee relationships are good.
Our aggregate sales in the automotive industry totaled 43%, 36% and 31% of our revenues during the fiscal years ended December 31, 2023, 2022 and 2021, respectively. During 2023, 2022 and 2021, General Motors accounted for approximately 20%, 16% and 13% of our total operating revenues, respectively. Sales to our top 10 customers, including General Motors, totaled 48% in 2023.
Our aggregate sales in the automotive industry totaled 47%, 43% and 36% of our revenues during the fiscal years ended December 31, 2024, 2023 and 2022, respectively. In 2024, 2023 and 2022, General Motors accounted for approximately 18%, 20% and 16% of our total operating revenues, respectively, and Ford accounted for approximately 17%, 6% and 6%, respectively.
Accordingly, we establish financial reserves for anticipated losses and expenses related to motor cargo liability and material handling claims, and we periodically evaluate and adjust those reserves to reflect our experience.
Accordingly, we establish financial reserves for anticipated losses and expenses related to motor cargo liability and material handling claims, and we periodically evaluate and adjust those reserves to reflect our experience. Any such adjustments could have a materially adverse effect on our operations and financial results.
At December 31, 2023, we operated 50 company-managed terminal locations, serviced 71 value-added programs at locations throughout the United States and in Mexico, Canada and Colombia, and had an agent network totaling approximately 230 agents. We were incorporated in Michigan on December 11, 2001.
At December 31, 2024, we operated 52 company-managed terminal locations, serviced 90 value-added programs at locations throughout the United States and in Mexico, Canada and Colombia, and had an agent network totaling approximately 177 agents.
Under specific environmental laws, we could also be held responsible for any costs relating to contamination at our past or present facilities and at third-party waste disposal sites, as well as costs associated with cleanup of accidents involving our vehicles. 8 As climate change issues become more prevalent, federal, state and local governments, as well as some of our customers, have made efforts to respond to these issues.
Under specific environmental laws, we could also be held responsible for any costs relating to contamination at our past or present facilities and at third-party waste disposal sites, as well as costs associated with cleanup of accidents involving our vehicles.
We also encounter competition from regional and local third-party logistics providers, integrated transportation companies that operate their own aircraft, cargo sales agents and brokers, surface freight forwarders and carriers, airlines, associations of shippers organized to consolidate their members’ shipments to obtain lower freight rates, and internet-based freight exchanges.
These vendors have the scope and capabilities to provide the breadth of services required by the large and complex supply chains of automotive original equipment manufacturers (OEMs). 5 We also encounter competition from regional and local third-party logistics providers, integrated transportation companies that operate their own aircraft, cargo sales agents and brokers, surface freight forwarders and carriers, airlines, associations of shippers organized to consolidate their members’ shipments to obtain lower freight rates, and internet-based freight exchanges.
Revenue Equipment The following table represents our equipment used to provide transportation services as of December 31, 2023: Type of Equipment Company- owned or Leased Owner- Operator Provided Total Tractors 1,945 1,766 3,711 Yard Tractors 339 — 339 Trailers 4,434 950 5,384 Chassis 3,494 — 3,494 Containers 108 — 108 Risk Management and Insurance Our customers and federal regulations generally require that we provide insurance for auto liability and general liability claims up to $1.0 million per occurrence.
They are also responsible for maintaining compliance with Federal Motor Carrier Safety Administration regulations. 6 Revenue Equipment The following table represents our equipment used to provide transportation services as of December 31, 2024: Type of Equipment Company- owned or Leased Owner- Operator Provided Total Tractors 2,603 1,598 4,201 Yard Tractors 737 — 737 Trailers 5,051 709 5,760 Chassis 3,354 — 3,354 Containers 107 — 107 Risk Management and Insurance Our customers and federal regulations generally require that we provide insurance for auto liability and general liability claims up to $1.0 million per occurrence.
These agreements provide guaranteed wage and benefit levels throughout the contract term. With the ratification of new contracts in 2023, we expect our customers to experience significant increases in their labor costs through the life of the contracts.
These agreements provide guaranteed wage and benefit levels throughout the contract term. We expect our customers to experience significant increases in their labor costs through the life of the contracts. These cost increases may cause certain of our customers to evaluate the outsourcing of certain value-added operations where we possess demonstrated experience and expertise.
In 2023, dedicated services represented approximately $343.5 million, or 20.7%, of our operating revenues. Our dedicated services are primarily short run or round-trip moves within a defined geographic area provided through a network of union and non-union employee drivers, owner-operators, and contract drivers. Value-Added .
This segment also includes our dedicated services, which are primarily short run or round-trip moves within a defined geographic area provided through a network of union and non-union employee drivers, owner-operators, and contract drivers.
We have been a publicly held company since February 11, 2005, the date of our initial public offering. Our principal executive offices are located at 12755 E. Nine Mile Road, Warren, Michigan 48089. Operations We broadly group our revenues into the following service categories: truckload, brokerage, intermodal, dedicated, and value-added services. Truckload .
We were incorporated in Michigan on December 11, 2001. We have been a publicly held company since February 11, 2005, the date of our initial public offering. Our principal executive offices are located at 12755 E. Nine Mile Road, Warren, Michigan 48089.
The transportation and logistics industry is highly fragmented, with thousands of small and mid-sized competitors that are either specialized in specific vertical markets, specific service offerings, or limited to local and regional coverage. We expect to selectively evaluate and pursue acquisitions that will enhance our service capabilities, expand our geographic network and/or diversify our customer base.
Business and Growth Strategy The key elements of our strategy are as follows: Make strategic acquisitions. The transportation and logistics industry is highly fragmented, with thousands of small and mid-sized competitors that are either specialized in specific vertical markets, specific service offerings, or limited to local and regional coverage.
The operations that we aggregate in our contract logistics segment deliver value-added and dedicated transportation services to support in-bound logistics to original equipment manufacturers (OEMs) and major retailers on a contractual basis, generally pursuant to terms of one year or longer.
We categorize our operations in three distinct reportable segments: contract logistics, intermodal, and trucking, which are differentiated primarily by the services provided by each segment. • Contract Logistics - Value-added or dedicated transportation services to support in-bound logistics to industrial customers and major retailers on a contractual basis, generally pursuant to terms of one year or longer.
Our truckload services include dry van, flatbed, heavy-haul and refrigerated operations. Truckload services represented approximately $213.9 million, or 12.9%, of our operating revenues in 2023. We transport a wide variety of general commodities, including automotive parts, machinery, building materials, paper, food, consumer goods, furniture, steel and other metals on behalf of customers in various industries. Brokerage .
We transport a wide variety of general commodities, including automotive parts, machinery, building materials, paper, food, consumer goods, furniture, steel and other metals on behalf of customers in various industries.
The operations that we group in our trucking segment are associated with individual freight shipments coordinated primarily by our agents using a mix of owner-operators, company equipment and broker carriers. Our company-managed brokerage segment provides for the pick-up and delivery of individual freight shipments using broker carriers, coordinated by our company-managed operations.
Operations included in our trucking segment are associated with individual freight shipments coordinated primarily by our agents and company-managed terminals using a mix of owner-operators, company equipment and broker carriers. 4 Other non-reportable segments are comprised of legacy company-managed brokerage operations and our subsidiaries that provide support services to other subsidiaries.
A significant percentage of our revenue also results from our providing capacity to other transportation companies that aggregate loads from a variety of shippers in these and other industries. Human Capital Resources Overview . As of December 31, 2023, we had 9,311 employees.
In 2024, 2023 and 2022, sales to our top 10 customers, including General Motors and Ford, totaled 56%, 48% and 42%, respectively. A significant percentage of our revenue also results from our providing capacity to other transportation companies that aggregate loads from a variety of shippers in these and other industries. Human Capital Resources Overview .
Available Information We make available free of charge on or through our website, www.universallogistics.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission (SEC).
Additionally, our transportation services business, excluding dedicated transportation tied to specific customer supply chains, is generally impacted by decreased activity during the post-holiday winter season and, in certain states during hurricane season, because some shippers reduce their shipments and inclement weather impedes trucking operations or underlying customer demand. 8 Available Information We make available free of charge on or through our website, www.universallogistics.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission (SEC).
Our value-added services, which are typically tailored to individual customer requirements, include material handling, consolidation, sequencing, sub-assembly, cross-dock services, kitting, repacking, warehousing and returnable container management. Value-added services represented approximately $486.0 million, or 29.2%, of our operating revenues in 2023.
These services are typically tailored to individual customer requirements and include material handling, consolidation, sequencing, sub-assembly, cross-dock services, kitting, repacking, warehousing and returnable container management and rail lift services.
Our commitment to diversity and inclusion means that we will continue to strive to establish and improve an inclusive workplace environment where employees from all backgrounds can succeed and be heard. 6 Employee Health and Safety . We are committed to being an industry leader in health and safety standards.
A qualified, diverse, and inclusive workforce also helps us represent the broad cross-section of ideas, values, and beliefs of our employees, customers, and communities. Our commitment to diversity and inclusion means that we will continue to strive to establish and improve an inclusive workplace environment where employees from all backgrounds can succeed and be heard. Employee Health and Safety .
Intermodal support services represented $374.7 million, or 22.5%, of our operating revenues in 2023. Our intermodal support services are primarily short- to medium-distance delivery of both international and domestic containers between the railhead or port and the customer. Dedicated . Our dedicated services are primarily provided in support of automotive customers using van equipment.
Our intermodal support services are primarily short- to medium-distance delivery of both international and domestic containers between the railhead or port and the customer. • Trucking - Dry van, flatbed, heavy-haul and refrigerated operations.
Our intermodal segment is associated with local and regional drayage moves predominately coordinated by company-managed terminals using a mix of owner-operators, company equipment and third-party capacity providers that are commonly referred to as broker carriers.
Our facilities and services are often directly integrated into the production processes of our customers and represent a critical part of their supply chains. • Intermodal - Local and regional drayage moves coordinated by company-managed terminals using a mix of owner-operators, company equipment, and third-party capacity providers (i.e., broker carriers). These services include steamship-truck, rail-truck, and support services.
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We provide customers with freight brokerage services by utilizing third-party transportation providers to transport goods. Brokerage services also include full service domestic and international freight forwarding, and customs brokerage. In 2023, brokerage services represented approximately $244.0 million, or 14.7%, of our operating revenues. 4 Intermodal . Intermodal operations include steamship-truck, rail-truck, and support services.
Added
For additional information on segments, see Item 8, Note 18 to the Consolidated Financial Statements. Business Developments Acquisitions . On September 30, 2024, we completed the acquisition of Parsec, LLC, which provides terminal management services to the Class I, regional, and short-line railroads across North America.
Removed
Our facilities and services are often directly integrated into the production processes of our customers and represent a critical piece of their supply chains. Segments We report our financial results in four distinct reportable segments: contract logistics, intermodal, trucking, and company-managed brokerage.
Added
Parsec, with a workforce of approximately 2,100 employees, offers a comprehensive suite of terminal services at over 20 rail yards throughout the United States and in Canada. Parsec specializes in time-sensitive, container lift-on and lift-off services at some of the most complex rail yards across the country.
Removed
These cost increases may cause certain of our customers to evaluate the outsourcing of certain value-added operations where we possess demonstrated experience and expertise.
Added
We expect to selectively evaluate and pursue acquisitions that will enhance our service capabilities, expand our geographic network and/or diversify our customer base. Continue to capitalize on strong industry fundamentals and outsourcing trends .
Removed
These vendors have the scope and capabilities to provide the breadth of services required by the large and complex supply chains of automotive original equipment manufacturers (OEMs).
Added
We are committed to being an industry leader in health and safety standards. The physical health, wellbeing, and mental health of our employees is crucial to our success.
Removed
A qualified, diverse, and inclusive workforce also helps us represent the broad cross-section of ideas, values, and beliefs of our employees, customers, and communities.
Added
As climate change issues become more prevalent, federal, state and local governments, as well as some of our customers, have made efforts to respond to these issues.
Removed
The physical health, wellbeing, and mental health of our employees is crucial to our success. Most recently, our primary concern during the COVID-19 pandemic has been to do our part to protect our employees, customers, vendors, and the general public from the spread of the virus while continuing to serve the vital role of supplying essential goods to the nation.
Removed
Additionally, our transportation services business, excluding dedicated transportation tied to specific customer supply chains, is generally impacted by decreased activity during the post-holiday winter season and, in certain states during hurricane season, because some shippers reduce their shipments and inclement weather impedes trucking operations or underlying customer demand.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

30 edited+16 added−8 removed89 unchanged
Biggest changeWe do not have any direct operations in Israel, Egypt, Jordan, Lebanon, Syria, the West Bank or Gaza, but we may be affected by the broader consequences of the conflict in the Middle East.
Biggest changeThe conflicts in Ukraine and the Middle East, expansion of such conflicts to other areas or similar conflicts, as well as the rising tensions between China and Taiwan, could adversely impact our business and financial results We do not have any direct operations in Russia, Belarus, Ukraine, the Middle East, China, or Taiwan, but we may be affected by the broader consequences of the conflicts, or expansion of such conflicts to other areas or countries or similar conflicts elsewhere.
These factors include the following: • we compete with many other truckload carriers and logistics companies of varying sizes, some of which have more equipment, a broader coverage network, a wider range of services and greater capital resources than we do; • some of our competitors periodically reduce their rates to gain business, especially during times of reduced growth rates in the economy, which may limit our ability to maintain or increase rates, maintain our operating margins, or maintain significant growth in our business; • many customers reduce the number of carriers they use by selecting so-called “core carriers” as approved service providers and, in some instances, we may not be selected; • some companies hire lead logistics providers to manage their logistics operations, and these lead logistics providers may hire logistics providers on a non-neutral basis which may reduce the number of business opportunities available to us; • many customers periodically accept bids from multiple carriers and providers for their shipping and logistic service needs, and this process may result in the loss of some of our business to competitors and/or price reductions; • the trend toward consolidation in the trucking and third-party logistics industries may create other large providers with greater financial resources and other competitive advantages relating to their size and with whom we may have difficulty competing; • advances in technology require increased investments to remain competitive, and our customers may not be willing to accept higher rates to cover the cost of these investments; • competition from Internet-based and other brokerage companies may adversely affect our relationships with our customers and freight rates; • economies of scale that may be passed on to smaller providers by procurement aggregation providers may improve the ability of smaller providers to compete with us; • some areas of our service coverage require trucks with engines no older than 2011 in order to comply with environmental rules; and • an inability to continue to access capital markets to finance equipment acquisition could put us at a competitive disadvantage.
These factors include the following: • we compete with many other truckload carriers and logistics companies of varying sizes, some of which have more equipment, a broader coverage network, a wider range of services and greater capital resources than we do; • some of our competitors periodically reduce their rates to gain business, especially during times of reduced growth rates in the economy, which may limit our ability to maintain or increase rates, maintain our operating margins, or maintain significant growth in our business; • many customers reduce the number of carriers they use by selecting so-called “core carriers” as approved service providers and, in some instances, we may not be selected; • some companies hire lead logistics providers to manage their logistics operations, and these lead logistics providers may hire logistics providers on a non-neutral basis which may reduce the number of business opportunities available to us; • many customers periodically accept bids from multiple carriers and providers for their shipping and logistic service needs, and this process may result in the loss of some of our business to competitors and/or price reductions; • the trend toward consolidation in the trucking and third-party logistics industries may create other large providers with greater financial resources and other competitive advantages relating to their size and with whom we may have difficulty competing; • advances in technology require increased investments to remain competitive, and our customers may not be willing to accept higher rates to cover the cost of these investments; 9 • competition from Internet-based and other brokerage companies may adversely affect our relationships with our customers and freight rates; • economies of scale that may be passed on to smaller providers by procurement aggregation providers may improve the ability of smaller providers to compete with us; • some areas of our service coverage require trucks with engines no older than 2011 in order to comply with environmental rules; and • an inability to continue to access capital markets to finance equipment acquisition could put us at a competitive disadvantage.
Our current indebtedness, as well as any future indebtedness, could, among other things: • impair our ability to obtain additional future financing for working capital, capital expenditures, acquisitions, or general corporate expenses; • limit our ability to use operating cash flow in other areas of our business due to the necessity of dedicating a substantial portion of these funds for payments on our indebtedness; • limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; • make it more difficult for us to satisfy our obligations; • increase our vulnerability to general adverse economic and industry conditions; and • place us at a competitive disadvantage compared to our competitors.
Our current indebtedness, as well as any future indebtedness, could, among other things: • impair our ability to obtain additional future financing for working capital, capital expenditures, acquisitions, or general corporate expenses; • limit our ability to use operating cash flow in other areas of our business due to the necessity of dedicating a substantial portion of these funds for payments on our indebtedness; • limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; • make it more difficult for us to satisfy our obligations; 12 • increase our vulnerability to general adverse economic and industry conditions; and • place us at a competitive disadvantage compared to our competitors.
The potential implications include increased inflation, supply chain disruption, reduced access to parts for our revenue equipment, embargoes, geopolitical shifts, reduced access to diesel fuel, higher energy prices, and other effects on the global economy. The magnitude of these risks cannot be predicted, including the extent to which the conflicts may heighten other risk factors.
The potential implications include increased tariffs, inflation, supply chain disruption, reduced access to parts for our revenue equipment, embargoes, geopolitical shifts, reduced access to diesel fuel, higher energy prices, and other effects on the global economy. The magnitude of these risks cannot be predicted, including the extent to which the conflicts may heighten other risk factors.
A labor dispute involving another supplier to our customers that results in a slowdown or closure of our customers’ plants where we provide services could also have a material adverse effect on our business. Significant increases in labor costs as a result of the renegotiation of our collective bargaining agreements could be harmful to our business and our profitability.
A labor dispute involving another supplier to our customers that results in a slowdown or closure of our customers’ plants where we provide services could also have a material adverse effect on our business. 11 Significant increases in labor costs as a result of the renegotiation of our collective bargaining agreements could be harmful to our business and our profitability.
Ultimately, these factors could materially and adversely affect the results of our operations. 12 Ongoing insurance and claims expenses could significantly reduce our earnings and cash flows. Our future insurance and claims expenses might exceed historical levels, which could reduce our earnings and cash flows. We are self-insured for health and workers’ compensation insurance coverage up to certain limits.
Ultimately, these factors could materially and adversely affect the results of our operations. Ongoing insurance and claims expenses could significantly reduce our earnings and cash flows. Our future insurance and claims expenses might exceed historical levels, which could reduce our earnings and cash flows. We are self-insured for health and workers’ compensation insurance coverage up to certain limits.
Further, we are affected by recessionary economic cycles and downturns in customers’ business cycles, particularly in market segments and industries, such as the automotive industry, where we have a significant concentration of customers. Economic conditions may also adversely affect our customers and their ability to pay for our services.
We are affected by recessionary economic cycles and downturns in customers’ business cycles, particularly in market segments and industries, such as the automotive industry, where we have a significant concentration of customers. Economic conditions may also adversely affect our customers and their ability to pay for our services.
Natural disasters such as earthquakes, tsunamis, hurricanes, tornadoes, floods or other adverse weather and climate conditions, whether occurring in the United States or abroad, could disrupt our operations or the operations of our customers or could damage or destroy infrastructure necessary to transport products as part of the supply chain.
Natural disasters such as fires, earthquakes, tsunamis, hurricanes, tornadoes, floods or other adverse weather and climate conditions, whether occurring in the United States or abroad, could disrupt our operations or the operations of our customers or could damage or destroy infrastructure necessary to transport products as part of the supply chain.
The cost of complying with these regulatory measures, or any future measures, could have a materially adverse effect on our business or results of operations. A determination that independent contractors are employees could expose us to various liabilities and additional costs.
The cost of complying with these regulatory measures, or any future measures, could have a materially adverse effect on our business or results of operations. 10 A determination that independent contractors are employees could expose us to various liabilities and additional costs.
As a result, these events could make it difficult or impossible for us to provide logistics and transportation services; disrupt or prevent our ability to perform functions at the corporate level; and/or otherwise impede our ability to continue business operations in a continuous manner consistent with the level and extent of business activities prior to the occurrence of the unexpected event, which could adversely affect our business and results of operations or make our results more volatile. 14 Our business may be harmed by public health crises, terrorist attacks, future war, or anti-terrorism measures.
As a result, these events could make it difficult or impossible for us to provide logistics and transportation services; disrupt or prevent our ability to perform functions at the corporate level; and/or otherwise impede our ability to continue business operations in a continuous manner consistent with the level and extent of business activities prior to the occurrence of the unexpected event, which could adversely affect our business and results of operations or make our results more volatile. 13 Our business may be harmed by public health crises, terrorist attacks, future war, or anti-terrorism measures.
Any future successful cyber-attack or catastrophic natural disaster could significantly affect our operating and financial systems and could temporarily disrupt our ability to provide required services to our customers, impact our ability to manage our operations and perform vital financial processes, any of which could have a materially adverse effect on our business. 15 We are subject to certain risks arising from doing business in Mexico.
Any future successful cyber-attack or catastrophic natural disaster could significantly affect our operating and financial systems and could temporarily disrupt our ability to provide required services to our customers, impact our ability to manage our operations and perform vital financial processes, any of which could have a materially adverse effect on our business. 14 We are subject to certain risks arising from doing business in Mexico.
Moroun, the Chairman of our Board of Directors, is the trustee of certain family trusts that collectively own greater than 50% of our outstanding shares. In this capacity, Mr. Moroun holds investment power over the shares in the family trusts. Frederick P.
Matthew T. Moroun, the Chairman of our Board of Directors, is the trustee of certain family trusts that collectively own greater than 50% of our outstanding shares. In this capacity, Mr. Moroun holds investment power over the shares in the family trusts. Frederick P.
As of December 31, 2023, approximately 33% of our employees were members of unions and subject to collective bargaining agreements. Subject to a few exceptions, each of our unionized facilities has a separate agreement with the union that generally represents the workers at only that facility.
As of December 31, 2024, approximately 46% of our employees were members of unions and subject to collective bargaining agreements. Subject to a few exceptions, each of our unionized facilities has a separate agreement with the union that generally represents the workers at only that facility.
Failure to maintain effective internal control over financial reporting could result in violations of applicable securities laws, stock exchange listing requirements, and the covenants under our debt agreements, subject us to litigation and investigations, negatively affect investor confidence in our financial statements, and adversely impact our stock price and ability to access capital markets. ITEM 1B: UNRESOLVED STAFF COMMENTS None.
Failure to maintain effective internal control over financial reporting could result in violations of applicable securities laws and stock exchange listing requirements, subject us to litigation and investigations, negatively affect investor confidence in our financial statements, and adversely impact our stock price and ability to access capital markets. ITEM 1B: UNRESOLVED STAFF COMMENTS None. 17
A large portion of our revenue is generated from a limited number of major customers concentrated in the automotive, retail and consumer goods, steel and other metals, energy and manufacturing industries. Our top 10 customers accounted for approximately 48% of our operating revenues during 2023.
A large portion of our revenue is generated from a limited number of major customers concentrated in the automotive, railroad, retail and consumer goods, steel and other metals, energy and manufacturing industries. Our top 10 customers accounted for approximately 56% of our operating revenues during 2024.
Our articles of incorporation and bylaws have, and under Michigan law are subject to, provisions that could deter or prevent a change of control. Our articles of incorporation and bylaws contain provisions that might enable our management to resist a proposed takeover of our Company.
As a result, we may not pay dividends at the historical rate or at all. Our articles of incorporation and bylaws have, and under Michigan law are subject to, provisions that could deter or prevent a change of control. Our articles of incorporation and bylaws contain provisions that might enable our management to resist a proposed takeover of our Company.
A controlled company may elect not to comply with certain corporate governance requirements, including: • a majority of the board of directors consist of independent directors; • a nominating and corporate governance committee composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and • the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities. 16 We are a controlled company under these rules, and these requirements will not apply to us as long as we retain that status.
A controlled company may elect not to comply with certain corporate governance requirements, including: • a majority of the board of directors consist of independent directors; • a nominating and corporate governance committee composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and • the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
Given the daily average trading volume of our common stock, significant sales of the common stock in a brief period of time, or the expectation of these sales, could cause a decline in the price of our common stock. Additionally, low trading volumes may limit a shareholder’s ability to sell shares of our common stock.
Given the daily average trading volume of our common stock, significant sales of the common stock in a brief period of time, or the expectation of these sales, could cause a decline in the price of our common stock.
Any of these factors could impair our operating efficiency and productivity and result in higher operating costs. In addition, revenues could decrease if we are unable to meet regulatory or customer sustainability requirements.
Any of these factors could impair our operating efficiency and productivity and result in higher operating costs. In addition, revenues could decrease if we are unable to meet regulatory or customer sustainability requirements. These additional costs, changes in operations, or loss of revenues could have a material adverse effect on our business, financial condition, and results of operations.
Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of NASDAQ. Our stock trading volume may not provide adequate liquidity for investors.
We are a controlled company under these rules, and these requirements will not apply to us as long as we retain that status. Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of NASDAQ. Our stock trading volume may not provide adequate liquidity for investors.
If we are unable to attract drivers when needed or contract with independent contractors when needed, we could be required to further adjust our driver compensation packages, increase driver recruiting efforts, or let trucks sit idle, any of which could adversely affect our growth and profitability. 10 Purchase price increases for new revenue equipment and/or decreases in the value of used revenue equipment could have an adverse effect on our results of operations, cash flows and financial condition.
If we are unable to attract drivers when needed or contract with independent contractors when needed, we could be required to further adjust our driver compensation packages, increase driver recruiting efforts, or let trucks sit idle, any of which could adversely affect our growth and profitability.
Deterioration in the United States and world economies could exacerbate any difficulties experienced by our customers and suppliers in obtaining financing, which, in turn, could materially and adversely impact our business, financial condition, results of operations and cash flows. 9 We operate in the highly competitive and fragmented transportation and logistics industry, and our business may suffer if we are unable to adequately address factors that may adversely affect our revenue and costs relative to our competitors.
Deterioration in the United States and world economies could exacerbate any difficulties experienced by our customers and suppliers in obtaining financing, which, in turn, could materially and adversely impact our business, financial condition, results of operations and cash flows.
In addition, certain provisions of Michigan law that apply to us could discourage or prevent a change of control or acquisition of our Company. 17 Ineffective internal control over financial reporting could result in errors in our financial statements, reduce investor confidence, and adversely impact our stock price.
In addition, certain provisions of Michigan law that apply to us could discourage or prevent a change of control or acquisition of our Company. We identified a material weakness in our internal control over financial reporting that could have resulted in material misstatements in our financial statements and cause us to fail to meet our reporting and financial obligations.
We also cannot provide assurance that we would be able to dispose of material assets or operations or restructure our debt or other obligations if necessary or, even if we were able to take such actions, that we could do so on terms that are acceptable to us. 13 Disruptions in the credit markets may adversely affect our business, including the availability and cost of short-term funds for liquidity requirements and our ability to meet long-term commitments, which could adversely affect our results of operations, cash flows and financial condition.
We also cannot provide assurance that we would be able to dispose of material assets or operations or restructure our debt or other obligations if necessary or, even if we were able to take such actions, that we could do so on terms that are acceptable to us.
If we are unable to address business concerns related to our Mexican operations in a timely and cost-efficient manner, our financial position, results of operations, or cash flows could be adversely affected. Risks Related to Our Common Stock Our public shareholders may have limited influence over our significant corporate actions. Matthew T.
If we are unable to address business concerns related to our Mexican operations in a timely and cost-efficient manner, our financial position, results of operations, or cash flows could be adversely affected. If we make acquisitions in the future, we may not successfully integrate the acquired company, which could have a materially adverse effect on our business.
These additional costs, changes in operations, or loss of revenues could have a material adverse effect on our business, financial condition, and results of operations. 11 Risks Related to Our Business Our revenue is largely dependent on North American automotive industry production volume and may be negatively affected by future downturns in North American automobile production.
Risks Related to Our Business Our revenue is largely dependent on North American automotive industry production volume and may be negatively affected by future downturns in North American automobile production. A significant portion of our larger customers are concentrated in the North American automotive industry.
Any future downturns in North American automobile production, which also impacts our steel and other metals customers, could similarly affect our revenues in future periods.
During 2024, 47% of our revenues were derived from customers in the North American automotive industry. Our business and growth largely depend on continued demand for its services from customers in this industry. Any future downturns in North American automobile production, which also impacts our steel and other metals customers, could similarly affect our revenues in future periods.
The terms of our future collective bargaining agreements may also affect our competitive position and results of operations. The conflict in the Middle East, or expansion of the conflict to other areas or countries, or similar conflicts in the region could adversely impact our business and financial results.
The terms of our future collective bargaining agreements may also affect our competitive position and results of operations.
As discussed in Part II, Item 9A “Management’s Report on Internal Control Over Financial Reporting” later in this report, in the fourth quarter of 2023, we identified a material weakness in controls in place to identify potential data-entry errors related to our contracted rates and quantities and their associated invoices and amounts recorded as unbilled revenue.
As discussed in Part II, Item 9A “Management’s Report on Internal Control Over Financial Reporting” later in this report, in the fourth quarter of 2024, we identified a material weakness in our internal control over financial reporting. The material weakness results from errors in our financial statement preparation and the accounting for non-routine transactions that created changes within our business.
In 2023, the United Auto Workers conducted a trilateral strike against Ford, General Motors, and Stellantis. Although the UAW reached agreements with Ford, General Motors, and Stellantis, similar such actions in the future could negatively impact our revenue and profitability.
Strikes, work stoppages, slowdown or similar such actions in the future could negatively impact our revenue and profitability.
Removed
Numerous competitive factors could impair our ability to maintain our current profitability.
Added
The Trump administration has stated its intention to impose new or increased tariff rates on imported goods from a number of countries, including China, Canada, Mexico, and the E.U.
Removed
A significant portion of our larger customers are concentrated in the North American automotive industry. During 2023, 43% of our revenues were derived from customers in the North American automotive industry. Our business and growth largely depend on continued demand for its services from customers in this industry.
Added
Such trade policies and tariff implementations, and any related retaliatory trade policies and tariff implementations by foreign governments, may result in decreased shipping volumes and have an adverse impact on our revenues and results of operations.
Removed
Our ability to pay regular dividends on our common stock is subject to the discretion of our Board of Directors and will depend on, among other things, our financial condition, results of operations, capital requirements, any covenants included in our credit facilities any legal or contractual restrictions on the payment of dividends and other factors the Board of Directors deems relevant.
Added
We operate in the highly competitive and fragmented transportation and logistics industry, and our business may suffer if we are unable to adequately address factors that may adversely affect our revenue and costs relative to our competitors. Numerous competitive factors could impair our ability to maintain our current profitability.
Removed
We have adopted a cash dividend policy which anticipates a total annual dividend of $0.42 per share of common stock.
Added
Purchase price increases for new revenue equipment and/or decreases in the value of used revenue equipment could have an adverse effect on our results of operations, cash flows and financial condition.
Removed
However, the payment of future dividends will be at the discretion of our Board of Directors and will depend, among other things, on our financial condition, results of operations, capital requirements, any covenants included in our credit facilities, any legal or contractual restrictions on the payment of dividends and other factors the Board of Directors deem relevant.
Added
Disruptions in the credit markets may adversely affect our business, including the availability and cost of short-term funds for liquidity requirements and our ability to meet long-term commitments, which could adversely affect our results of operations, cash flows and financial condition.
Removed
As a consequence of these limitations and restrictions, we may not be able to make, or may have to reduce or eliminate, the payment of dividends on our common stock. Any change in the level of our dividends or the suspension of the payment thereof could adversely affect the market price of our common stock.
Added
Historically, acquisitions have been a part of our growth. If we experience any internal integration issues with the acquired companies, they may negatively affect our results of operations. There is no assurance that we will be successful in identifying, negotiating, or consummating any future acquisitions.
Removed
We are in the process of remediating the material weakness, but our efforts may not be successful.
Added
If we fail to make any future acquisitions, our historical growth rate could be materially and adversely affected.
Removed
To remediate the material weakness, we plan to modify our policies and procedures for the timely review and approval of those contracted rates that are entered into the system, add a monitoring control that requires a secondary review of all contracted rates entered into the system to ensure they are being reviewed timely and entered accurately, and enhance the controls associated with invoices to ensure they reflect contracted rates.
Added
If we succeed in consummating future acquisitions, our business, financial condition and results of operations, may be materially adversely affected because: • Some of the acquired businesses may not achieve anticipated revenue, earnings, or cash flows; • We may assume liabilities that were not disclosed to us or otherwise exceed our estimates; • We may be unable to integrate acquired businesses successfully, or at all, and realize anticipated economic, operational and other benefits in a timely manner, which could result in substantial costs and delays or other operational, technical, or financial problems; • Acquisitions could disrupt our ongoing business, distract our management, and divert our resources; • We may experience an increase in our customer concentration; • We may experience difficulties operating in markets in which we have had no or only limited direct experience; • We may incur transaction costs and acquisition-related integration costs; • We could lose customers, employees, and drivers of any acquired company; • We may experience potential future impairment charges, write-offs, write-downs, or restructuring charges; and • We may incur indebtedness, issue dilutive equity securities, and/or incur large one-time expenses or charges. 15 Risks Related to Our Common Stock Our public shareholders may have limited influence over our significant corporate actions.
Added
Additionally, low trading volumes may limit a shareholder’s ability to sell shares of our common stock. 16 We may change our dividend policy at any time.
Added
The declaration and amount of any future dividends, including the payment of special dividends, is dependent on multiple factors, including our financial performance and capital needs, and is subject to the discretion of the Board of Directors.
Added
Our Board may, in its discretion, determine to cut, cancel, or eliminate our dividend and, therefore, the declaration of any dividend, at any frequency, as it is not assured. Each quarter, the Board considers whether the declaration of a dividend is in the best interest of our shareholders and in compliance with applicable laws and agreements.
Added
Although we expect to continue to pay dividends to holders of our common stock, we have no obligation to do so, and our dividend policy may change at any time without notice.
Added
Future dividends may also be affected by factors that our Board deems relevant, including our potential future capital requirements for investments, legal risks, changes in federal and state income tax laws, or corporate laws and contractual restrictions such as financial or operating covenants in our credit facilities.
Added
The primary cause of the errors was the need for additional technical accounting resources to allow us to accurately record and properly present our financial statements and related disclosures. We plan on remediating our material weakness, but our efforts may not be successful.
Added
To remediate the material weakness, we plan to enhance our internal staff of accounting and financial reporting employees with employees that have the requisite technical accounting knowledge. We also plan to expand our use of external consulting firms to provide advisory support for technical accounting guidance.
Added
We further intend to design and implement controls to formalize review procedures around the financial close process with appropriate segregation of duties.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe team is led by individuals who, on a combined basis, have more than 20 years of IT and cybersecurity related experience across multiple industries. Our Manager of Information Security has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and any retained external cybersecurity consultants.
Biggest changeOur Cybersecurity team, led by our Vice President of Cyber Security, is responsible for assessing and managing our material risks from cybersecurity threats. The team is led by individuals who, on a combined basis, have more than 30 years of IT and cybersecurity related experience across multiple industries.
Key components of our cybersecurity risk management program include: • risk assessments designed to help identify cybersecurity risks to our critical systems, information, services, and our broader enterprise IT environment; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security processes; • cybersecurity awareness training of our employees, incident response personnel and senior management; and • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents.
Key components of our cybersecurity risk management program include: • risk assessments designed to help identify cybersecurity risks to our critical systems, information, services, and our broader enterprise IT environment; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) architecture, implementation and monitoring of our security controls and infrastructure, and (3) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security processes; • cybersecurity awareness training of our employees, incident response personnel and senior management; and • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents.
The Audit Committee reports to the full Board regarding its activities, including those related to cybersecurity, and the full Board also receives a periodic briefing from management on our cyber risk management program. 18 Our Cybersecurity team, led by our Manager of Information Security, is responsible for assessing and managing our material risks from cybersecurity threats.
In addition, management updates the Audit Committee, as necessary, regarding any significant cybersecurity incidents. The Audit Committee reports to the full Board regarding its activities, including those related to cybersecurity, and the full Board also receives a periodic briefing from management on our cyber risk management program.
Removed
In addition, management updates the Audit Committee, as necessary, regarding any significant cybersecurity incidents.
Added
Our Vice President of Cyber Security has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and any retained external cybersecurity consultants.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe own our corporate administrative offices, as well as 23 terminal yards and other properties in the following locations: Dearborn, Michigan; Romulus, Michigan; Compton, California; Riverside, California; Jacksonville, Florida; Garden City, Georgia; Savannah, Georgia; Harvey, Illinois; Gary, Indiana; Louisville, Kentucky; Albany, Missouri; South Kearny, New Jersey; Cleveland, Ohio; Columbus, Ohio; Reading, Ohio; York County, Pennsylvania; Wall, Pennsylvania; Mount Pleasant, South Carolina; Memphis, Tennessee; Dallas, Texas; Houston, Texas; Cloverdale, Virginia; and Clearfield, Utah.
Biggest changeWe own our corporate administrative offices, as well as 24 terminal yards and other properties in the following locations: Dearborn, Michigan; Romulus, Michigan; Compton, California; Riverside, California; Jacksonville, Florida; Garden City, Georgia; Savannah, Georgia; Harvey, Illinois; Gary, Indiana; Louisville, Kentucky; Albany, Missouri; South Kearny, New Jersey; Cleveland, Ohio; Columbus, Ohio; Reading, Ohio; York County, Pennsylvania; Wall, Pennsylvania; Mount Pleasant, South Carolina; Memphis, Tennessee; Dallas, Texas; Houston, Texas; Cloverdale, Virginia; and Clearfield, Utah. 18 As of December 31, 2024, we also leased 78 operating, terminal and yard, and administrative facilities in various U.S. cities located in 24 states, in Windsor, Ontario; and in Monterrey, Mexico; San Luis Potosí, Mexico; and Toluca, Mexico.
ITEM 2: P ROPERTIES We are headquartered and maintain our corporate administrative offices in Warren, Michigan.
ITEM 2: P ROPERTIES Our headquarters, where we maintain our corporate administrative offices, are in Warren, Michigan.
We also deliver value-added services under our contract logistics segment inside or linked to 38 facilities provided by customers. Certain of our leased facilities are leased from entities controlled by our majority shareholders. These facilities are leased on either a month-to-month basis or extended terms.
Generally, our facilities are utilized by our operating segments for various administrative, transportation-related or value-added services. We also deliver value-added services under our contract logistics segment inside or linked to 54 facilities provided by customers. Certain of our leased facilities are leased from entities controlled by our majority shareholders.
For more information on our lease arrangements, see Part II, Item 8: Notes 10, 12 and 15 to the Consolidated Financial Statements.
These facilities are leased on either a month-to-month basis or extended terms. For more information on our lease arrangements, see Part II, Item 8: Notes 11, 13 and 16 to the Consolidated Financial Statements.
Removed
As of December 31, 2023, we also leased 87 operating, terminal and yard, and administrative facilities in various U.S. cities located in 22 states, in Windsor, Ontario; and in Monterrey, Mexico; Saltillo, Mexico; and San Luis Potosí, Mexico. Generally, our facilities are utilized by our operating segments for various administrative, transportation-related or value-added services.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThere were no purchases of our equity securities by or on behalf of us or any affiliated purchaser within the fourth quarter of 2023. 20 Performance Graph The graph below matches Universal Logistics Holdings, Inc.'s cumulative 5-year total shareholder return on common stock with the cumulative total returns of the NASDAQ Composite index and the NASDAQ Transportation index.
Biggest changeNo specific expiration date has been assigned to the authorization. 20 Performance Graph The graph below matches Universal Logistics Holdings, Inc.'s cumulative 5-year total shareholder return on common stock with the cumulative total returns of the NASDAQ Composite index and the NASDAQ Transportation index.
In addition, under our current dividend policy, after considering the regular quarterly dividends made during the year, the Board of Directors also evaluates the potential declaration of an annual special dividend payable in the first quarter of each year. The Board of Directors did not declare a special dividend in the first quarter of 2024.
In addition, under our current dividend policy, after considering the regular quarterly dividends made during the year, the Board of Directors also evaluates the potential declaration of an annual special dividend payable in the first quarter of each year. The Board of Directors did not declare a special dividend in the first quarter of 2025.
ITEM 5: MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED S TOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is traded on The NASDAQ Global Market under the symbol ULH. As of March 4, 2024, there were approximately 50 record holders of our common stock, based upon data available to us from our transfer agent.
ITEM 5: MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED S TOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is traded on The NASDAQ Global Market under the symbol ULH. As of March 7, 2025, there were approximately 50 record holders of our common stock, based upon data available to us from our transfer agent.
Purchases of Equity Securities by the Issuer On July 29, 2021, the Company announced that it had been authorized to purchase up to 1,000,000 shares of its common stock from time to time in the open market. As of December 31, 2023, 513,251 shares remain available under this authorization. No specific expiration date has been assigned to the authorization.
On July 29, 2021, the Company announced that it had been authorized to purchase up to 1,000,000 shares of its common stock from time to time in the open market. As of December 31, 2024, 513,251 shares remain available under this authorization.
The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from December 31, 2018 to December 31, 2023. 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 Universal Logistics Holdings, Inc. 100.00 107.96 118.61 110.74 199.29 169.50 NASDAQ Composite 100.00 136.69 198.10 242.03 163.28 236.17 NASDAQ Transportation 100.00 123.21 130.96 148.36 120.19 161.24 The stock price performance included in this graph is not necessarily indicative of future stock price performance. 21 ITEM 6: R ESERVED
The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from December 31, 2019 to December 31, 2024. 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 Universal Logistics Holdings, Inc. 100.00 109.86 102.58 184.59 157.00 260.01 NASDAQ Composite 100.00 144.92 177.06 119.45 172.77 223.87 NASDAQ Transportation 100.00 106.29 120.41 97.55 130.87 133.76 The stock price performance included in this graph is not necessarily indicative of future stock price performance. 21 ITEM 6: R ESERVED
Added
Purchases of Equity Securities by the Issuer The following table provides information regarding the Company’s purchases of its common stock during the period from September 29, 2024 to December 31, 2024, the Company’s fourth fiscal quarter: Fiscal Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Number of Shares that May Yet be Purchased Under the Plans or Program Sept. 29, 2024 - Oct. 26, 2024 — $ — — 513,251 Oct. 27, 2024 - Nov. 23, 2024 — — — 513,251 Nov. 24, 2024 - Dec. 31, 2024 471 (1) 51.46 — 513,251 Total 471 $ 51.46 — 513,251 (1) Consists of 471 shares of common stock acquired on November 25, 2024 by the Company from an employee for $24,238 upon exercising its right of first refusal pursuant to a restricted stock bonus award agreement.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe decrease in income taxes is primarily the result of a decrease in taxable income. 26 2022 Compared to 2021 The following table sets forth items derived from our Consolidated Statements of Income for the years ended December 31, 2022 and 2021: 2022 2021 Percent Change in Dollar Amount (Dollars in millions) $ % $ % % Operating revenues $ 2,015,456 100.0 % $ 1,750,980 100.0 % 15.1 % Operating expenses: Purchased transportation and equipment rent 847,414 42.0 824,789 47.1 2.7 Direct personnel and related benefits 520,263 25.8 454,256 25.9 14.5 Operating supplies and expenses 177,440 8.8 149,394 8.5 18.8 Commission expense 40,288 2.0 33,894 1.9 18.9 Occupancy expense 41,286 2.0 37,286 2.1 10.7 General and administrative 48,924 2.4 42,035 2.4 16.4 Insurance and claims 22,749 1.1 38,829 2.2 (41.4 ) Depreciation and amortization 76,657 3.8 67,537 3.9 13.5 Total operating expenses 1,775,021 88.1 1,648,020 94.1 7.7 Income from operations 240,435 11.9 102,960 5.9 133.5 Interest (expense), net (16,156 ) (0.8 ) (11,599 ) (0.7 ) 39.3 Other non-operating income 1,143 0.1 7,220 0.4 (84.2 ) Income before income taxes 225,422 11.2 98,581 5.6 128.7 Income tax expense 56,790 2.8 24,848 1.4 128.5 Net income $ 168,632 8.4 % $ 73,733 4.2 % 128.7 % Operating revenues .
Biggest changeThe following table sets forth operating revenues resulting from each of these service categories for the years ended December 31, 2024, 2023 and 2022, presented as a percentage of total operating revenues: Years ended December 31, 2024 2023 2022 Operating revenues: Truckload services 12.7 % 12.9 % 11.4 % Brokerage services 9.8 14.7 18.3 Intermodal services 16.3 22.5 29.4 Dedicated services 18.6 20.7 16.1 Value-added services 42.6 29.2 24.8 Total operating revenues 100.0 % 100.0 % 100.0 % Results of Operations 2024 Compared to 2023 The following table sets forth items derived from our Consolidated Statements of Income for the years ended December 31, 2024 and 2023: 2024 2023 Percent Change in Dollar Amount (Dollars in millions) $ % $ % % Operating revenues $ 1,846,035 100.0 % $ 1,662,139 100.0 % 11.1 % Operating expenses: Purchased transportation and equipment rent 482,948 26.2 571,213 34.4 (15.5 ) Direct personnel and related benefits 583,251 31.6 542,779 32.7 7.5 Operating supplies and expenses 295,558 16.0 170,994 10.3 72.8 Commission expense 27,285 1.5 31,370 1.9 (13.0 ) Occupancy expense 44,209 2.4 44,301 2.7 (0.2 ) General and administrative 55,323 3.0 51,839 3.1 6.7 Insurance and claims 26,441 1.4 27,163 1.6 (2.7 ) Depreciation and amortization 124,188 6.7 77,036 4.6 61.2 Impairment expense 3,720 0.2 — — n/m Total operating expenses 1,642,923 89.0 1,516,695 91.2 8.3 Income from operations 203,112 11.0 145,444 8.8 39.6 Interest (expense), net (30,207 ) (1.6 ) (22,753 ) (1.4 ) 32.8 Other non-operating income 837 0.0 1,608 0.1 (47.9 ) Income before income taxes 173,742 9.4 124,299 7.5 39.8 Income tax expense 43,835 2.4 31,398 1.9 39.6 Net income $ 129,907 7.0 % $ 92,901 5.6 % 39.8 % Operating revenues .
Trends in direct personnel and benefit costs are generally correlated with changes in operating facilities and headcount requirements and, therefore, fluctuate correspondingly with the level of demand for our staffing needs in our contract logistics segment, which includes value-added services and dedicated transportation, as well as the use of employee drivers in certain of our intermodal operations.
Trends in direct personnel and benefit costs are generally correlated with changes in operating facilities and headcount requirements and, therefore, fluctuate correspondingly with the level of demand for our staffing needs in our contract logistics segment, which includes value-added services and dedicated transportation, as well as the use of employee drivers in certain of our intermodal operations.
Income from operations increased $9.3 million and operating margin, as a percentage of revenue was 15.4% for 2023, compared to 14.4% last year. 28 Operating revenues in the intermodal segment decreased 36.7% primarily due to decreases in the average revenue per load, excluding fuel surcharges and in the number of loads hauled.
Income from operations increased $9.3 million and operating margin, as a percentage of revenue was 15.4% for 2023, compared to 14.4% last year. Operating revenues in the intermodal segment decreased 36.7% primarily due to decreases in the average revenue per load, excluding fuel surcharges and in the number of loads hauled.
Operations in our intermodal, trucking and company-managed brokerage segments are associated with individual freight shipments coordinated by our agents and company-managed terminals. In contrast, our contract logistics segment delivers value-added services and/or transportation services to specific customers on a dedicated basis, generally pursuant to contract terms of one year or longer.
Operations in our intermodal and trucking segments are associated with individual freight shipments coordinated by our agents and company-managed terminals. In contrast, our contract logistics segment delivers value-added services and/or transportation services to specific customers on a dedicated basis, generally pursuant to contract terms of one year or longer.
These fluctuations are generally correlated with changes in demand for transactional transportation-related services. The absolute decrease in purchased transportation and equipment rental costs was primarily the result of an overall decrease in transactional transportation-related services. In 2023, transactional transportation-related service revenues decreased 30.1% compared to the prior year. 25 Direct personnel and related benefits .
These fluctuations are generally correlated with changes in demand for transactional transportation-related services. The absolute decrease in purchased transportation and equipment rental costs was primarily the result of an overall decrease in transactional transportation-related services. In 2023, transactional transportation-related service revenues decreased 30.1% compared to the prior year. Direct personnel and related benefits .
The operations in the United States, Mexico and Canada that are subject to collective bargaining agreements have separate, individualized agreements with several different unions that represent employees in these operations. While there are some facilities with multiple unions, each collective bargaining agreement with each union covers a single facility for that union.
The operations in the United States and Canada that are subject to collective bargaining agreements have separate, individualized agreements with several different unions that represent employees in these operations. While there are some facilities with multiple unions, each collective bargaining agreement with each union covers a single facility for that union.
The increase in general and administrative expense was primarily due to an increase in salaries and wages as well as professional fees. Insurance and claims .
The increase in general and administrative expense was primarily due to an increase in salaries and wages as well as professional fees. 27 Insurance and claims .
During each of the third quarters of 2023 and 2022, we completed our goodwill impairment testing by performing a quantitative assessment using the income approach for each of our reporting units with goodwill. The determination of the fair value of the reporting units requires us to make estimates and assumptions related to future revenue, operating income and discount rates.
During each of the third quarters of 2024 and 2023, we completed our annual goodwill impairment testing by performing a quantitative assessment using the income approach for each of our reporting units with goodwill. The determination of the fair value of the reporting units requires us to make estimates and assumptions related to future revenue, operating income and discount rates.
We operate, manage or provide services at 121 logistics locations in the United States, Mexico, Canada and Colombia and through our network of agents and owner-operators located throughout the United States and in Ontario, Canada.
We operate, manage or provide services at 142 logistics locations in the United States, Mexico, Canada and Colombia and through our network of agents and owner-operators located throughout the United States and in Ontario, Canada.
These costs are a significant component of our cost structure and increase or decrease proportionately with the expansion, addition or closing of operating facilities. As of December 31, 2023, approximately 33% of our employees were subject to collective bargaining agreements. Any changes in union agreements will affect our personnel and related benefits cost.
These costs are a significant component of our cost structure and increase or decrease proportionately with the expansion, addition or closing of operating facilities. As of December 31, 2024, approximately 46% of our employees were subject to collective bargaining agreements. Any changes in union agreements will affect our personnel and related benefits cost.
Our facilities and services are often directly integrated into the production processes of our customers and represent a critical piece of their supply chains.
Our facilities and services are often directly integrated into the production processes of our customers and represent a critical part of their supply chains.
We also expect to continue to make strategic acquisitions of companies that complement our business model, as well as companies that derive a portion of their revenues from asset based operations. We report our financial results in four distinct reportable segments, contract logistics, intermodal, trucking, and company-managed brokerage.
We also expect to continue to make strategic acquisitions of companies that complement our business model, as well as companies that derive a portion of their revenues from asset based operations. We report our financial results in three distinct reportable segments, contract logistics, intermodal, and trucking.
Thirty-eight of our value-added service operations are located inside customer plants or distribution operations; the other facilities are generally located close to our customers’ plants to optimize the efficiency of their component supply chains and production processes.
Fifty-four of our value-added service operations are located inside customer plants or distribution operations; the other facilities are generally located close to our customers’ plants to optimize the efficiency of their component supply chains and production processes.
See Item 8, Note 15 to the Consolidated Financial Statements. 31 Critical Accounting Policies Our financial statements have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, operating revenues and operating expenses.
Critical Accounting Policies Our financial statements have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, operating revenues and operating expenses.
Operations aggregated in our contract logistics segment deliver value-added and/or dedicated transportation services to support in-bound logistics to original equipment manufacturers (OEMs) and major retailers on a contractual basis, generally pursuant to terms of one year or longer.
Operations aggregated in our contract logistics segment deliver value-added and/or dedicated transportation services to support in-bound logistics to industrial customers and major retailers on a contractual basis, generally pursuant to terms of one year or longer.
Accordingly, if the outcome of legal proceedings is different than is anticipated by us, we would have to record the matter at the actual amount at which it was resolved, in the period resolved, impacting our results of operations and financial position for the period.
Accordingly, if the outcome of legal proceedings is different than is anticipated by us, we would have to record the matter at the actual amount at which it was resolved, in the period resolved, impacting our results of operations and financial position for the period. See Item 8, Note 16 to the Consolidated Financial Statements.
We market our services through a direct sales and marketing network focused on selling our portfolio of services to large customers in specific industry sectors, through company-managed facilities and full-service freight forwarding and customs house brokerage offices, and through a contract network of agents who solicit freight business directly from shippers.
We market our services through a direct sales and marketing network focused on selling our portfolio of services to large customers in specific industry sectors, through company-managed facilities, and through a contract network of agents who solicit freight business directly from shippers.
As of December 31, 2023 and 2022, we had accruals of $11.2 million and $14.3 million, respectively, for estimated claims net of insurance receivables.
As of December 31, 2024 and 2023, we had accruals of $13.3 million and $11.2 million, respectively, for estimated claims net of insurance receivables.
The following table sets forth operating revenues resulting from each of these service categories for the years ended December 31, 2023, 2022 and 2021, presented as a percentage of total operating revenues: Years ended December 31, 2023 2022 2021 Operating revenues: Truckload services 12.9 % 11.4 % 14.2 % Brokerage services 14.7 18.3 22.9 Intermodal services 22.5 29.4 27.0 Dedicated services 20.7 16.1 11.7 Value-added services 29.2 24.8 24.2 Total operating revenues 100.0 % 100.0 % 100.0 % Results of Operations 2023 Compared to 2022 The following table sets forth items derived from our Consolidated Statements of Income for the years ended December 31, 2023 and 2022: 2023 2022 Percent Change in Dollar Amount (Dollars in millions) $ % $ % % Operating revenues $ 1,662,139 100.0 % $ 2,015,456 100.0 % (17.5 )% Operating expenses: Purchased transportation and equipment rent 571,213 34.4 847,414 42.0 (32.6 ) Direct personnel and related benefits 542,779 32.7 520,263 25.8 4.3 Operating supplies and expenses 170,994 10.3 177,440 8.8 (3.6 ) Commission expense 31,370 1.9 40,288 2.0 (22.1 ) Occupancy expense 44,301 2.7 41,286 2.0 7.3 General and administrative 51,839 3.1 48,924 2.4 6.0 Insurance and claims 27,163 1.6 22,749 1.1 19.4 Depreciation and amortization 77,036 4.6 76,657 3.8 0.5 Total operating expenses 1,516,695 91.2 1,775,021 88.1 (14.6 ) Income from operations 145,444 8.8 240,435 11.9 (39.5 ) Interest (expense), net (22,753 ) (1.4 ) (16,156 ) (0.8 ) 40.8 Other non-operating income 1,608 0.1 1,143 0.1 40.7 Income before income taxes 124,299 7.5 225,422 11.2 (44.9 ) Income tax expense 31,398 1.9 56,790 2.8 (44.7 ) Net income $ 92,901 5.6 % $ 168,632 8.4 % (44.9 )% Operating revenues .
The increase in income taxes is primarily the result of an increase in taxable income. 26 2023 Compared to 2022 The following table sets forth items derived from our Consolidated Statements of Income for the years ended December 31, 2023 and 2022: 2023 2022 Percent Change in Dollar Amount (Dollars in millions) $ % $ % % Operating revenues $ 1,662,139 100.0 % $ 2,015,456 100.0 % (17.5 )% Operating expenses: Purchased transportation and equipment rent 571,213 34.4 847,414 42.0 (32.6 ) Direct personnel and related benefits 542,779 32.7 520,263 25.8 4.3 Operating supplies and expenses 170,994 10.3 177,440 8.8 (3.6 ) Commission expense 31,370 1.9 40,288 2.0 (22.1 ) Occupancy expense 44,301 2.7 41,286 2.0 7.3 General and administrative 51,839 3.1 48,924 2.4 6.0 Insurance and claims 27,163 1.6 22,749 1.1 19.4 Depreciation and amortization 77,036 4.6 76,657 3.8 0.5 Total operating expenses 1,516,695 91.2 1,775,021 88.1 (14.6 ) Income from operations 145,444 8.8 240,435 11.9 (39.5 ) Interest (expense), net (22,753 ) (1.4 ) (16,156 ) (0.8 ) 40.8 Other non-operating income 1,608 0.1 1,143 0.1 40.7 Income before income taxes 124,299 7.5 225,422 11.2 (44.9 ) Income tax expense 31,398 1.9 56,790 2.8 (44.7 ) Net income $ 92,901 5.6 % $ 168,632 8.4 % (44.9 )% Operating revenues .
Other non-operating income increased by $0.5 million in 2023 and included $0.2 million in realized gain on sales of marketable securities during the year. Income tax expense . Our effective income tax rate was 25.3% in 2023 compared to 25.2% last year.
Other non-operating income increased by $0.5 million in 2023 and included $0.2 million in realized gain on sales of marketable securities during the year. Income tax expense . Our effective income tax rate was 25.3% in 2023 compared to 25.2% in 2022. The decrease in income taxes was primarily the result of a decrease in taxable income.
Our intermodal segment is associated with local and regional drayage moves predominately coordinated by company-managed terminals using a mix of owner-operators, company equipment and third-party capacity providers (broker carriers). Operations aggregated in our trucking segment are associated with individual freight shipments coordinated by our agents and company-managed terminals using a mix of owner-operators, company equipment and broker carriers.
Our intermodal segment is associated with local and regional drayage moves predominately coordinated by company-managed terminals using a mix of owner-operators, company equipment and third-party capacity providers (broker carriers).
As of December 31, 2023, we employed 9,311 people in the United States, Mexico, Canada, and Colombia, including 3,038 employees subject to collective bargaining agreements. We also engaged contract staffing vendors to supply an average of 450 additional personnel on a full-time-equivalent basis.
As of December 31, 2024, we employed 10,821 people in the United States, Mexico, Canada, and Colombia, including 4,929 employees subject to collective bargaining agreements. We also engaged contract staffing vendors to supply an average of 88 additional personnel on a full-time-equivalent basis.
Based on our 2023 reserve for claims incurred but not reported, a 10% increase in claims incurred but not reported would increase our insurance and claims expense by approximately $0.5 million. Valuation of Long-Lived Assets, including Goodwill and Intangible Assets At both December 31, 2023 and 2022, our goodwill balance was $170.7 million.
Based on our 2024 reserve for claims incurred but not reported, a 10% increase in claims incurred but not reported would increase our insurance and claims expense by approximately $0.5 million. 31 Valuation of Long-Lived Assets, including Goodwill and Intangible Assets As of December 31, 2024 and 2023, our goodwill balances were $206.8 million and $170.7 million, respectively.
If the carrying amount of the reporting unit exceeds its fair value, then an impairment loss is recognized in an amount equal to the excess, up to the value of the goodwill.
If the carrying amount of the reporting unit exceeds its fair value, then an impairment loss is recognized in an amount equal to the excess, up to the value of the goodwill. In the third quarter of 2024, the Company closed its company-managed brokerage operations.
Our truckload, intermodal and brokerage revenues are primarily influenced by fluctuations in freight volumes and shipping rates. The main factors that affect these are competition, available truck capacity, and economic market conditions. Our value-added and dedicated transportation business is substantially driven by the level of demand for outsourced logistics services.
The main factors that affect these are competition, available truck capacity, and economic market conditions. Our value-added and dedicated transportation business is substantially driven by the level of demand for outsourced logistics services.
We offer our customers a wide range of transportation services by utilizing a diverse fleet of tractors and trailing equipment provided by us, our owner-operators and third-party transportation companies. Our owner-operators provided us with 1,766 tractors and 950 trailers. We own 2,284 tractors, 4,434 trailers, 3,494 chassis and 108 containers.
We offer our customers a wide range of transportation services by utilizing a diverse fleet of tractors and trailing equipment provided by us, our owner-operators and third-party transportation companies. Our owner-operators provided us with 1,598 tractors and 709 trailers. We own 3,340 tractors, 5,051 trailers, 3,354 chassis and 107 containers.
Contractual Obligations As of December 31, 2023, we had contractual obligations related to our long-term debt of $314.8 million and $58.2 million for principal borrowings and interest, respectively, which become due through 2032. See Item 8, Note 8 to the Consolidated Financial Statements for additional information regarding our debt obligations.
Contractual Obligations As of December 31, 2024, we had contractual obligations related to our long-term debt, inclusive of our credit facilities, of $672.9 million and $88.7 million for principal borrowings and interest, respectively, which become due through 2032. See Item 8, Note 9, Debt and Credit Facilities, for additional information regarding our debt obligations.
Our company-managed brokerage segment provides for the pick-up and delivery of individual freight shipments using broker carriers, coordinated by our company-managed operations. 22 Current Economic Conditions As a leading provider of customized freight transportation and logistics solutions, our business can be impacted to varying degrees by factors beyond our control.
Operations included in our trucking segment are associated with individual freight shipments coordinated by our agents and company-managed terminals using a mix of owner-operators, company equipment and broker carriers. 22 Current Economic Conditions As a leading provider of customized freight transportation and logistics solutions, our business can be impacted to varying degrees by factors beyond our control.
The increase was due to the launch of new business wins and robust volumes experienced at our contract logistics operations during 2022. While generalizations about the impact of personnel and related benefits costs are difficult, we manage compensation and staffing levels, including the use of contract labor, to maintain target economics based on near-term projections of demand for our services.
While generalizations about the impact of personnel and related benefits costs are difficult, we manage compensation and staffing levels, including the use of contract labor, to maintain target economics based on near-term projections of demand for our services. Operating supplies and expenses .
There were no triggering events identified from the date of our assessment through December 31, 2023 that would require an update to our annual impairment test. 32 We evaluate the carrying value of long-lived assets, other than goodwill, for impairment by analyzing the operating performance and anticipated future cash flows for those assets, whenever events or changes in circumstances indicate that the carrying amounts of such assets may not be recoverable.
We evaluate the carrying value of long-lived assets, other than goodwill, for impairment by analyzing the operating performance and anticipated future cash flows for those assets, whenever events or changes in circumstances indicate that the carrying amounts of such assets may not be recoverable.
During the period, we made payments on term loan and equipment and real estate notes totaling $74.6 million, borrowed $56.2 million for new equipment and had net borrowings on our revolving lines of credit totaling $21.9 million.
We had outstanding borrowings totaling $762.6 million at December 31, 2024 compared to $386.4 million at December 31, 2023. During the period, we made payments on term loan and equipment and real estate notes totaling $104.2 million, borrowed $191.4 million for new equipment and had net borrowings on our revolving lines of credit totaling $288.9 million.
The primary drivers behind the increase in working capital were principal reductions in operating lease liabilities during the period, increases in prepaid expenses and other assets, and decreases in trade accounts payable, accruals for insurance and claims, income taxes payable and other long-term liabilities. These were partially offset by decreases in trade and other accounts receivable, and other assets.
Excluding the impacts on working capital from business combinations, the primary drivers behind the increase were principal reductions in operating lease liabilities during the period, increases in contract assets, and decreases in trade accounts payable, income taxes payable and in other long-term liabilities.
As a percentage of revenue, operating margin for 2023 was (1.9)% compared to 5.0% during the same period last year. 2022 Compared to 2021 In the contract logistics segment, which includes our value-added and dedicated services, operating revenues increased 31.4% due to robust volumes. At the end of 2022, Universal managed 63 value-added programs, unchanged from the prior year period.
As a percentage of revenue, operating margin in the trucking segment for the year ended December 31, 2024, was 6.3% compared to 5.2% during the same period last year. 2023 Compared to 2022 In the contract logistics segment, which includes our value-added and dedicated services, operating revenues increased 0.7%.
Trucking segment revenues included $168.3 million of brokerage services compared to $159.0 million during the same period in the prior year. Also included in our trucking segment revenues were $34.7 million in separately identified fuel surcharges during 2022 compared to $24.4 million in fuel surcharges in 2021.
Trucking segment revenues included $101.3 million of brokerage services compared to $124.3 million during the same period last year. Also included in our trucking segment revenues were $20.0 million in separately identified fuel surcharges during the year ended December 31, 2024 compared to $25.5 million in fuel surcharges in the year ended December 31, 2023.
Operating supplies and expenses . Operating supplies and expenses include items such as fuel, maintenance, cost of materials, communications, utilities and other operating expenses, and generally relate to fluctuations in customer demand. The main elements driving the change were increases in fuel expense on company tractors, vehicle and other maintenance, and bad debt expense.
Operating supplies and expenses include items such as fuel, maintenance, cost of materials, communications, utilities and other operating expenses, and generally relate to fluctuations in customer demand. The main element driving the change was an increase in the expenses incurred in connection with the previously announced contract logistics specialty development project. Commission expense .
Also included in operating revenues were other accessorial charges such as detention, demurrage and storage, which totaled $123.6 million during 2022 compared to $84.9 million one year earlier. Purchased transportation and equipment rent . Purchased transportation and equipment rent generally increases or decreases in proportion to the revenues generated through owner-operators and other third party providers.
Also included in operating revenues were other accessorial charges such as detention, demurrage and storage, which totaled $34.1 million during the year ended December 31, 2024, compared to $58.1 million one year earlier. 25 Purchased transportation and equipment rent .
These fluctuations are generally correlated with changes in demand for transactional transportation-related services. The absolute increase in purchased transportation and equipment rental costs was primarily the result of an overall increase in transactional transportation-related services. In 2022, transactional transportation-related service revenues increased 14.2% compared to 2021. Direct personnel and related benefits .
Purchased transportation and equipment rent generally increases or decreases in proportion to the revenues generated through owner-operators and other third party providers. These fluctuations are generally correlated with changes in demand for transactional transportation-related services. The absolute decrease in purchased transportation and equipment rental costs was primarily the result of an overall decrease in transactional transportation-related services.
This presentation reflects the manner in which management evaluates our operating segments, including an evaluation of economic characteristics and applicable aggregation criteria.
Segment Financial Results We report our financial results in three distinct reportable segments: contract logistics, intermodal, and trucking, which are based primarily on the services each segment provides. This presentation reflects the manner in which management evaluates our operating segments, including an evaluation of economic characteristics and applicable aggregation criteria.
In 2024, we expect our capital expenditures to be in the range of $480 million to $500 million. We expect to make these capital expenditures for the acquisition of transportation equipment, to support new and existing value-added service operations, to expand our owned terminal network, and for improvements to our existing terminal yard and container facilities.
These expenditures primarily consisted of transportation equipment, investments in support of our value-added service operations and the expansion of our terminal network. In 2025, we expect our capital expenditures to be in the range of $190 million to $215 million.
The increase in occupancy expense was attributable to an increase in building rents and property taxes. General and administrative . The increase in general and administrative expense was primarily attributable to an increase in salaries, wages, and benefits. 27 Insurance and claims .
The increase in general and administrative expense was primarily due to an increase in salaries, wages, benefits and bonuses. Insurance and claims . The decrease in insurance and claims expense was primarily due to a decrease in auto liability claims expense. Depreciation and amortization .
Affiliate transactions increased net cash provided by operating activities by $0.4 million. The increase in net cash resulted from an increase in accounts payable to affiliates of $0.1 million and a decrease in accounts receivable from affiliates of $0.2 million.
The increase in net cash resulted from an increase in accounts payable to affiliates of $2.5 million, which was partially offset by an increase in accounts receivable from affiliates of $0.6 million.
During 2022, Universal revised the estimated useful life and salvage value of certain equipment, and these adjustments resulted in additional depreciation expense of $9.7 million during the period. Interest expense, net . The increase in net interest expense reflects an increase in interest rates partially offset by a decrease in our outstanding borrowings.
The increase in depreciation and amortization expense resulted from a $38.3 million increase in depreciation expense and an $8.8 million increase in amortization expense. During the first half 2024, Universal revised the estimated useful life and salvage value of certain equipment, and these adjustments resulted in additional depreciation expense of $11.3 million during the period. Impairment expense .
We use judgment and evaluate, with the assistance of legal counsel, whether a loss contingency arising from litigation should be disclosed or recorded. The outcome of legal proceedings is inherently uncertain, so typically a loss cannot be precisely estimated.
We accrue estimated losses if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We use judgment and evaluate, with the assistance of legal counsel, whether a loss contingency arising from litigation should be disclosed or recorded.
Our segments are further distinguished by the amount of forward visibility we have into pricing and volumes, and also by the extent to which we dedicate resources and company-owned equipment. Fees charged to customers by our full service international freight forwarding and customs house brokerage are based on the specific means of forwarding or delivering freight on a shipment-by-shipment basis.
Our segments are further distinguished by the amount of forward visibility we have into pricing and volumes, and also by the extent to which we dedicate resources and company-owned equipment. Our truckload, intermodal and brokerage revenues are primarily influenced by fluctuations in freight volumes and shipping rates.
The average operating revenue per load, excluding fuel surcharges, increased 34.5% while load volumes fell 16.9% on a year-over-year basis. As a percentage of revenue, operating margin in the intermodal segment for 2022 was 14.1%, compared to 6.4% one year earlier. In the trucking segment, operating revenues decreased 2.6% due to a decrease in the number of loads hauled.
As a percentage of revenue, operating margin in the intermodal segment for the year ended December 31, 2024 was (9.0)%, compared to 0.4% one year earlier. In the trucking segment, operating revenues decreased 0.4% primarily due to a decrease in the number of loads hauled.
As a percentage of revenue, operating margin in the trucking segment for 2023 was 5.2% compared to 7.0% last year. Operating revenues in the company-managed brokerage segment decreased 40.3% primarily due to decreases in the average operating revenue per load and in the number of loads moved.
Income from operations increased $91.3 million and operating margin, as a percentage of revenue was 19.4% for the year ended December 31, 2024, compared to 15.4% in the year ended December 31, 2023. 28 Operating revenues in the intermodal segment decreased 19.3% primarily due to a decrease in the average operating revenue per load and the number of loads hauled.
The following tables summarize information about our reportable segments for the years ended December 31, 2023, 2022 and 2021 (in thousands): Operating Revenues December 31, 2023 2022 2021 Contract logistics $ 829,574 $ 823,934 $ 627,220 Intermodal 374,667 591,946 473,059 Trucking 333,211 392,639 403,312 Company-managed brokerage 119,741 200,536 242,794 Other 4,946 6,401 4,595 Total operating revenues $ 1,662,139 $ 2,015,456 $ 1,750,980 Income from Operations December 31, 2023 2022 2021 Contract logistics $ 127,752 $ 118,437 $ 44,809 Intermodal 1,297 83,640 30,379 Trucking 17,258 27,564 19,607 Company-managed brokerage (2,221 ) 9,993 7,122 Other 1,358 801 1,043 Total income from operations $ 145,444 $ 240,435 $ 102,960 2023 Compared to 2022 In the contract logistics segment, which includes our value-added and dedicated services, operating revenues increased 0.7%.
The following tables summarize information about our reportable segments for the years ended December 31, 2024, 2023 and 2022 (in thousands): Operating Revenues December 31, 2024 2023 2022 Contract logistics $ 1,129,658 $ 829,574 $ 823,934 Intermodal 308,744 382,610 622,615 Trucking 331,982 333,211 392,639 Other 75,651 116,744 176,268 Total operating revenues $ 1,846,035 $ 1,662,139 $ 2,015,456 Income from Operations December 31, 2024 2023 2022 Contract logistics $ 219,084 $ 127,752 $ 118,437 Intermodal (27,741 ) 1,604 85,037 Trucking 20,963 17,258 27,564 Other (9,194 ) (1,170 ) 9,397 Total income from operations $ 203,112 $ 145,444 $ 240,435 2024 Compared to 2023 In the contract logistics segment, which includes our value-added and dedicated services, operating revenues increased 36.2%.
As of December 31, 2022, our outstanding borrowings totaled $382.9 million compared to $428.4 million at the same time in 2021. Other non-operating income . Other non-operating income for 2022 includes a $1.0 million pre-tax holding gain on marketable securities due to changes in fair value recognized in income.
Other non-operating income . Other non-operating income decreased by $0.8 million in the year ended December 31, 2024 and included $0.8 million of pre-tax holding gain on marketable securities due to changes in fair value recognized in income. Income tax expense .
The $236.8 million in net cash used in investing activities consisted of $240.6 million in capital expenditures, which was partially offset by $3.5 million in proceeds from the sale of equipment and $0.3 million in proceeds from the sale of marketable securities. We used $8.6 million in financing activities.
The $462.9 million in net cash used in investing activities primarily consisted of $251.6 million in capital expenditures and $215.8 million for the acquisitions of Parsec and East Texas Heavy Haul. These expenditures were partially offset by $4.4 million in proceeds from the sale of equipment. Financing activities provided $365.0 million in net cash during the period.
We did not have any amounts advanced against the line as of December 31, 2023, and the maximum available borrowings were $5.3 million. Discussion of Cash Flows At December 31, 2023, we had cash and cash equivalents of $12.5 million compared to $47.2 million at December 31, 2022.
We did not have any amounts advanced against the line as of December 31, 2024, and the maximum available borrowings were $6.0 million. 29 We anticipate that cash generated from operations, together with amounts available under our credit facilities, will be sufficient to meet our requirements for the foreseeable future.
Included in intermodal segment revenues for 2022 were $92.3 million in separately identified fuel surcharges, compared to $51.2 million in 2021. Intermodal segment revenues also include other accessorial charges such as detention, demurrage and storage, which totaled $123.6 million during 2022 compared to $84.9 million one year earlier.
Intermodal segment revenues also include other accessorial charges such as detention, demurrage and storage, which totaled $34.1 million during the year ended December 31, 2024 compared to $58.1 million in the year ended December 31, 2023. Load volumes declined 11.8%, while the average operating revenue per load, excluding fuel surcharges, fell 1.6% on a year-over-year basis.
The Real Estate Facility matures on April 29, 2032 and is secured by first-priority mortgages on specific parcels of real estate owned by the Company, including all land and real property improvements, and first-priority assignments of rents and related leases of the loan parties.
We also have a $165.4 million term loan facility that matures in April 2032, and it is secured by first-priority mortgages on specific parcels of owned real estate. We also maintain a short-term line of credit secured by our portfolio of marketable securities.
Our UACL Credit Agreement includes an accordion feature which allows us to increase availability by up to $30 million upon our request. At December 31, 2023, we were in compliance with all its covenants, and $10.0 million was available for borrowing. A wholly owned subsidiary issued a series of promissory notes in order to finance transportation equipment (the “Equipment Financing”).
Our UACL subsidiaries have credit facility maturing in September 30, 2027, which includes a $10 million revolver. At December 31, 2024, $10.0 million was available for borrowing. We also finance the purchase of transportation equipment with equipment notes. The notes are secured by liens on specific vehicles and are generally payable in 60 monthly installments.
Based on the results of this test, no impairment loss was recognized.
Based on the results of this test, no further impairment loss was recognized. There were no triggering events identified from the date of our assessment through December 31, 2024 that would require an update to our annual impairment test.
The increase in operating revenues was primarily due to robust volumes in our contract logistics segment and increased rates in our transactional transportation-related services, which includes truckload, brokerage, and intermodal services. Operating revenues included separately identified fuel surcharges of $168.6 million in 2022, compared to $96.9 million in 2021.
The overall increase in operating revenues was primarily due to an increase in our contract logistics segment revenues. This increase was partially offset by decreases in our transactional transportation-related services.
Included in our contract logistics segment revenues for 2022 were $41.7 million in separately identified fuel surcharges from dedicated transportation services, compared to $21.2 million in 2021. Income from operations increased $73.6 million and operating margin, as a percentage of revenue was 14.4% for 2022, compared to 7.1% in 2021.
Included in contract logistics segment revenues for the year ended December 31, 2024, were $36.3 million in separately identified fuel surcharges from dedicated transportation services, compared to $36.3 million in the same period last year.
Removed
These were partially offset by decreases in other operating expenses including professional fees and travel and entertainment expense. Other operating expenses included $5.8 million of previously disclosed legal matters in 2021. Commission expense . Commission expense increased due to increased revenue from both our agency based truckload business and our intermodal agents. Occupancy expense .
Added
Contract logistics segment revenues in 2024 included $228.0 million attributable to our specialty development project in Stanton, TN, which was completed during the year, and an additional $59.5 million from the fourth quarter acquisition of Parsec.
Removed
The decrease in insurance and claims was attributable to decreases in auto liability insurance premiums and claims expense and in cargo and service failure claims. Our 2022 insurance and claims included a $3.0 million credit resulting from the favorable settlement of certain auto liability claims during the period.
Added
Operating revenues included separately-identified fuel surcharges of $97.1 million in the year ended December 31, 2024, compared to $118.3 million in the year ended December 31, 2023.
Removed
Included in insurance and claims expense in 2021 were $6.0 million related to previously disclosed items. Depreciation and amortization . The increase in depreciation and amortization expense resulted from an $8.6 million increase in depreciation expense and a $0.5 million increase in amortization expense.
Added
In the year ended December 31, 2024, transactional transportation-related service revenues decreased 14.0% compared to the prior year. Direct personnel and related benefits .
Removed
Other non-operating income for 2021 includes a $5.7 million pre-tax gain from a favorable legal settlement and a $1.5 million pre-tax holding gain on marketable securities due to changes in fair value recognized in income. Income tax expense . Our effective tax rate was 25.2% in both 2022 and 2021.
Added
The increase in the year ended December 31, 2024, was due to an increase in headcount in our contract logistics businesses primarily due to the acquisition of Parsec.
Removed
The increase in income taxes in 2022 is the result of an increase in taxable income. Segment Financial Results We report our financial results in four distinct reportable segments: contract logistics, intermodal, trucking, and company-managed brokerage, which are based primarily on the services each segment provides.
Added
Commission expense decreased due to decreased revenue in our agency-based truckload business. Occupancy expense . The decrease in occupancy expense was attributable to a decrease in building rents. This was partially offset by an increase in property taxes. General and administrative .
Removed
On a year-over-year basis, average operating revenue per load and load volumes in the company-managed brokerage segment decreased 21.0% and 16.9%, respectively.
Added
The increase in impairment expense primarily relates to the goodwill impairment charges resulting from the closure of our company-managed brokerage operations. Interest expense, net . The increase in net interest expense reflects an increase in our outstanding borrowings. As of December 31, 2024, our outstanding borrowings were $762.6 million compared to $386.4 million at December 31, 2023.
Removed
Included in 2021 were also $18.9 million of losses incurred in connection with previously disclosed contract logistics program launches. Operating revenues in the intermodal segment increased 25.1% primarily due to an increase in the average revenue per load, excluding fuel surcharges.
Added
Our effective income tax rate was 25.2% in year ended December 31, 2024, compared to 25.3% in the year ended December 31, 2023.
Removed
Trucking segment results also included $6.0 million in previously disclosed pre-tax charges in 2021. On a year-over-year basis, the average operating revenue per load, excluding fuel surcharges, increased 33.3% while load volumes declined 30.7%. As a percentage of revenue, operating margin in the trucking segment for 2022 was 7.0% compared to 4.9% for 2021.
Added
Contract logistics segment revenues in 2024 included $228.0 million attributable to our specialty development project in Stanton, TN, which was completed during the year, and an additional $59.5 million from the fourth quarter acquisition of Parsec.
Removed
Operating revenues in the company-managed brokerage segment decreased 17.4% primarily due to a decrease in the number of loads moved. On a year-over-year basis, load volumes in the company-managed brokerage segment decreased 25.8% while average operating revenue per load increased 2.6%. As a percentage of revenue, operating margin for 2022 was 5.0% compared to 2.9% for 2021.
Added
At the end of the fourth quarter 2024, we managed 90 value-added programs, including 20 new rail terminal operations compared to 71 in the prior year.
Removed
Liquidity and Capital Resources Our primary sources of liquidity are funds generated by operations, loans and extensions of credit under our credit facilities, on margin against our marketable securities and from installment notes, and proceeds from the sales of marketable securities. We use secured asset lending to fund a substantial portion of purchases of tractors, trailers and material handling equipment.
Added
Included in intermodal segment revenues for the year ended December 31, 2024 were $40.7 million in separately identified fuel surcharges, compared to $56.5 million in the same period last year.
Removed
We employ a flexible operating strategy which we believe lowers our capital expenditure requirements. In general, our facilities used in our value-added services are leased on terms that are either substantially matched to our customer’s contracts, are month-to-month or are provided to us by our customers.
Added
On a year-over-year basis, load volumes declined 12.8%; however, the average operating revenue per load, excluding fuel surcharges, increased 14.7%, supported by our specialty, heavy-haul wind business.
Removed
We also utilize owner-operators and third-party carriers to provide a significant portion of our transportation and specialized services. A significant portion of the tractors and trailers used in our business are provided by our owner-operators. In addition, our use of agents reduces our overall need for large terminals.
Added
As a percentage of revenue, operating margin in the trucking segment for 2023 was 5.2% compared to 7.0% last year. Liquidity and Capital Resources Our primary uses of cash are working capital requirements, capital expenditures, dividend payments, share repurchases, and debt service requirements. Additionally, we may use cash for acquisitions and other investment and financing activities.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

12 edited+0 added−0 removed12 unchanged
Biggest changeFor additional information with respect to the marketable equity securities, see Item 8, Note 4 to the Consolidated Financial Statements. 33 Foreign Exchange Risk In the years ended December 31, 2023 and 2022, 2.4% and 1.9%, respectively, of our revenues were derived from services provided outside the United States, principally in Mexico, Canada and Colombia.
Biggest changeForeign Exchange Risk In the years ended December 31, 2024 and 2023, 3.0% and 2.4%, respectively, of our revenues were derived from services provided outside the United States, principally in Mexico, Canada and Colombia.
In addition, we have the ability to put these instruments back to the issuer at any time. Accordingly, any future interest rate risk on these short-term investments would not be material. Commodity Price Risk Fluctuations in fuel prices can affect our profitability by affecting our ability to retain or recruit owner-operators.
In addition, we have the ability to put these instruments back to the issuer at any time. Accordingly, any future interest rate risk on these short-term investments would not be material. 32 Commodity Price Risk Fluctuations in fuel prices can affect our profitability by affecting our ability to retain or recruit owner-operators.
Based upon our 2023 fuel consumption, a 10% increase in the average annual price per gallon of diesel fuel would increase our annual fuel expense on company owned tractors by approximately $5.5 million.
Based upon our 2024 fuel consumption, a 10% increase in the average annual price per gallon of diesel fuel would increase our annual fuel expense on company owned tractors by approximately $5.2 million.
Since the swap agreements qualifies for hedge accounting, the changes in fair value are recorded in other comprehensive income (loss), net of tax. Included in cash and cash equivalents is approximately $0.2 million in short-term investment grade instruments. The interest rates on these instruments are adjusted to market rates at least monthly.
Since the swap agreements qualifies for hedge accounting, the changes in fair value are recorded in other comprehensive income (loss), net of tax. Included in cash and cash equivalents is approximately $26 thousand in short-term investment grade instruments. The interest rates on these instruments are adjusted to market rates at least monthly.
Based on 2023 expenditures denominated in foreign currencies, a 10% decrease in the exchange rates would increase our annual operating expenses by approximately $3.0 million. Historically, we have not entered into financial instruments for trading or speculative purposes. Short-term exposure to fluctuating foreign currency exchange rates are related primarily to intercompany transactions.
Based on 2024 expenditures denominated in foreign currencies, a 10% decrease in the exchange rates would increase our annual operating expenses by approximately $4.5 million. Historically, we have not entered into financial instruments for trading or speculative purposes. Short-term exposure to fluctuating foreign currency exchange rates are related primarily to intercompany transactions.
Equity Securities Risk We hold certain actively traded marketable equity securities, which subjects the Company to fluctuations in the fair market value of its investment portfolio based on current market price. The recorded value of marketable equity securities increased to $10.8 million at December 31, 2023 from $10.0 million at December 31, 2022.
Equity Securities Risk We hold certain actively traded marketable equity securities, which subjects the Company to fluctuations in the fair market value of its investment portfolio based on current market price. The recorded value of marketable equity securities increased to $11.6 million at December 31, 2024 from $10.8 million at December 31, 2023.
Borrowings under the credit agreements with each of the banks bear interest at Term SOFR or a base rate, plus an applicable margin. Our margin facility bears interest at Term SOFR plus 1.10%. As of December 31, 2023, we had total variable interest rate borrowings of $230.1 million.
Borrowings under the credit agreements with each of the banks bear interest at Term SOFR or a base rate, plus an applicable margin. Our margin facility bears interest at Term SOFR plus 1.10%. As of December 31, 2024, we had total variable interest rate borrowings of $484.5 million.
The swap agreement has an effective date of April 29, 2022, a maturity date of April 30, 2027, and an amortizing notional amount of $83.3 million. At December 31, 2023, the fair value of the swap agreement was an asset of $1.8 million.
The swap agreement has an effective date of April 29, 2022, a maturity date of April 30, 2027, and an amortizing notional amount of $73.3 million. At December 31, 2024, the fair value of the swap agreement was an asset of $1.6 million.
The increase resulted from an increase in the market value of the portfolio of approximately $0.8 million. During 2023, we also sold $0.3 million of marketable equity, with realized gains on sales totaling approximately $0.2 million.
The increase resulted from an increase in the market value of the portfolio of approximately $0.8 million. During 2024, we also sold $19 thousand of marketable equity securities, with realized gains on sales totaling approximately $2 thousand.
Assuming variable rate debt levels remain at $230.1 million for a full year, a 100 basis point increase in interest rates on our variable rate debt would increase interest expense approximately $2.3 million annually.
Assuming variable rate debt levels remain at $484.5 million for a full year, a 100 basis point increase in interest rates on our variable rate debt would increase interest expense approximately $4.8 million annually.
Adjustments from the translation of the net investment in these operations increased equity by approximately $4.1 million for the year ended December 31, 2023. 34
Adjustments from the translation of the net investment in these operations decreased equity by approximately $4.5 million for the year ended December 31, 2024. 33
A 10% decrease in the market price of our marketable equity securities would cause a corresponding 10% decrease in the carrying amounts of these securities, or approximately $1.1 million.
A 10% decrease in the market price of our marketable equity securities would cause a corresponding 10% decrease in the carrying amounts of these securities, or approximately $1.2 million. For additional information with respect to the marketable equity securities, see Item 8, Note 4 to the Consolidated Financial Statements.

Other ULH 10-K year-over-year comparisons