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TRANSPORTATION & LOGISTICSINDUSTRY UPDATE DECEMBER 2020www.harriswilliams.comInvestment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams Ltd, which is a private limited company incorporated under English lawwith its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales (registration number 07078852). Harris Williams Ltd is authorized andregulated by the Financial Conduct Authority. Harris Williams is a trade name under which Harris Williams LLC and Harris Williams Ltd conduct business.
TRANSPORTATION& LOGISTICSINDUSTRY UPDATE DECEMBER 2020Transportation & Logistics Industry UpdateHARRIS WILLIAMS DEAL SPOTLIGHTAppalachian Railcar ServicesHarris Williams advised Appalachian Railcar Services (ARS), a portfoliocompany of GenNx360 Capital Partners, on its sale to Cathcart Rail and itsfinancial partner, Star America Infrastructure Partners. ARS is one of thelargest railcar repair companies in the U.S. and provides a range ofindustrial logistic services.Press ReleaseWHAT WE’RE READINGLOGISTICS PANDEMIC-INDUCED VOLATILITY DRIVES COMPANIES TO SEEK VISIBILITYSOLUTIONSThe COVID-19 pandemic and the resulting supply chain disruptions have driven companies to seekvisibility solutions that allow them to track products from origin to delivery. Real-time visibility platformFourKites has seen a 200% increase in international load volumes tracked via its visibility platform and a50% increase in customers in 2020. This growth is driven not only by new customers but also by existingcustomers ramping up their interest in visibility solutions. To improve their platforms, visibility providersare investing in global expansion, capabilities to link rail, ocean, and over-the-road shipments with realtime estimated times of arrival, and real-time vessel and railcar position data measured against transittimes while factoring in speed, weather, port, and terminal congestion.TRUCKING CARRIERS FACE COMPOUNDED DEMAND THIS HOLIDAY SEASONThe trucking industry has been working diligently since March to replenish inventories depleted duringthe coronavirus, and now truckers face an additional challenge – meeting holiday season demand in ayear where 83% of U.S. consumers said they will shop online for more of their gifts. The trucking markethas tightened up quickly, keeping the pressure on intermodal as companies look for capacity. Trucking islikely to see the exceptionally high demand spill over into next year with the likelihood that gift returnswill be high and that retail inventories will still be depressed.RAIL IMPORT GAINS FUEL INTERMODALWeekly U.S. rail intermodal volumes rose 10.5% year over year in the first week of December. Railintermodal volumes have gotten a push from higher U.S. imports, which remain strong as retailers rushto fill warehouses for the holiday season and meet fast turnarounds for online orders. With this surge involume, railroads are experiencing capacity and storage issues, but they are working with intermodalmarketing companies on finding long-term solutions.MARINE TRANS-PACIFIC BOOM LIKELY TO LAST UNTIL MARCH OR LONGERThe continued rise in U.S. trans-Pacific cargo imports during Q2 and Q3 2020 is expected to continue into2021. Inbound volumes are on pace to hit a new peak in December at the port of Los Angeles, and theport of San Pedro Bay has become a container ship parking lot as trans-Pacific volumes exceed terminalcapacity. SeaIntelligence Consulting CEO Lars Jensen predicts that this wave will last through at leastMarch 2021 and will only begin to normalize when Americans shift their spending from services to goods.This shift will depend on increasing consumer confidence and less restrictive lockdown measures.AIR AIR CARGO SECTOR SHOOTS TOWARD 2021 RECOVERYWhile passenger airlines are struggling to survive, the air cargo market is poised to recover to pre-crisislevels in 2021, driven by the rebound in international trade and huge growth in e-commerce. The IATAprojects air cargo demand to fall 11.5% in 2020, but the year-over-year cargo gap is narrowing eachmonth. Cargo throughput could reach 2019 parity in the first quarter of 2021. Analysts and airfreightspecialists expect air cargo volumes to stay at peak levels through the Chinese New Year in February andthe rest of the first quarter, a period that typically sees a lull in air cargo following the holiday season inmany parts of the world.CONTENTS M&A TRANSACTIONSPUBLIC MARKETS OVERVIEWSTOCK PRICE PERFORMANCEOUR GROUPOUR PRACTICEUNITED STATESFrank MountcastleManaging Directorfmountcastle@harriswilliams.com 1 (804) 915-0124Jason BassManaging Directorjbass@harriswilliams.com 1 (804) 915-0132Joe ConnerManaging Directorjconner@harriswilliams.com 1 (804) 915-0151Jershon JonesManaging Directorjjones@harriswilliams.com 1 (804) 932-1356Jeff BurkettDirectorjburkett@harriswilliams.com 1 (804) 932-1334Jeff KiddDirectorjkidd@harriswilliams.com 1 (804) 915-0178Jon MeredithVice Presidentjmeredith@harriswilliams.com 1 (804) 887-6085Nicholas PetrickVice Presidentnipetrick@harriswilliams.com 1 (804) 887-6157Elliott YousefianVice Presidenteyousefian@harriswilliams.com 1 (804) 887-6168EUROPEJeffery PerkinsManaging Directorjperkins@harriswilliams.com 49 (0) 69 3650638 00PAGE 1
TRANSPORTATION & LOGISTICSINDUSTRY UPDATE DECEMBER 2020Public Markets Overview(1)TEV / LTM EBITDATEV / 2020E EBITDARail & Rail Services13.4xTransportation EquipmentRail & Rail Services10.5xLogistics ProvidersLogistics Providers9.3xMarine12.9xTransportation ing6.7xTRAILING TWELVE MONTHS TEV / LTM 0x5.0x4.0xDecember-19February-20Logistics ProvidersApril-20Trucking(1) Figures as of 12/16/2020June-20Rail and Rail ortation EquipmentPAGE 2
TRANSPORTATION & LOGISTICSINDUSTRY UPDATE DECEMBER 2020Stock Price Performance(1)MEDIAN % CHANGE (1 MONTH)MEDIAN % CHANGE (12 tion Equipment19.9%Logistics ProvidersLogistics Providers4.3%20.9%20.6%3.1%Rail & Rail ServicesRail & Rail Services3.0%S&P 500(2.5%)23.2%TruckingS&P 500Trucking30.2%Marine15.8%(18.1%)TRAILING TWELVE MONTH STOCK ary-20Logistic ProvidersTrucking(1) Figures as of 12/16/2020April-20Rail and Rail ServicesJuly-20MarineTransportation EquipmentS&P 500PAGE 3
TRANSPORTATION& LOGISTICSINDUSTRY UPDATE DECEMBER 2020M&A Transactions(1,2,3)RECENT M&A TRANSACTIONSDateSectorTargetBusiness DescriptionAcquirer12/15/2020LogisticsFetch LogisticsFreight brokerage company operating in the United StatesFitzMark12/15/2020TransportationAppalachian RailcarServicesLeading U.S. provider of railcar maintenance and repair servicesCathcart Rail (Star AmericaInfrastructure Partners)12/9/2020LogisticsNonstopDelivery, Inc.Provides third-party logistics and transportation servicesHub Group, Inc.12/7/2020LogisticsSEACOR Holdings Inc.Provides transportation and logistics, risk management consultancyAIP, LLC12/7/2020TransportationTrafficCast InternationalProvides intelligent transportation systems technology solutionsIteris, Inc.12/1/2020TransportationLumin8 TransportationTechnologiesProvides traffic signal, lighting, and intelligent transportation systemsolutionsCrest Rock Management11/30/2020TransportationRambler Air, LLCProvides passenger and cargo charter services. It offers scheduled passengerservices, freight and cargo services, and charter services for passenger andcargo transportationAscent Global Logistics11/30/2020LogisticsPan Am Railways, Inc.Provides rail transportation servicesCSX Corporation11/24/2020LogisticsPanther LogisticsProvides e-commerce residential transportation logistics and specialize inwhite glove and two-man deliveryAIT Worldwide ops transport management software for shippers and carriersPCS Software, Inc.11/19/2020LogisticsAssociated Couriers, Inc.Provides ground courier services. It specializes in carrying radioactivemedicines or other time sensitive freightSLS Special Logistics Services11/18/2020TransportationBeverly Hills Transfer &StorageProvides transportation, warehouse, and logistics servicesAccess Corp.11/12/2020TransportationCougar ExpressComprises pickup, warehousing, and delivery services business operationsTLSS Acquisition, Inc.11/12/2020LogisticsCapstone LogisticsDiversified 3PL offering technology-enhanced, outsourced supply chainsolutions from point-of-origin to final destinationH.I.G. Capital11/12/2020LogisticsGoConfigureProvides consumer delivery, assembly, and installation servicesSelect Express & Logistics11/10/2020TransportationFort Transfer Co.Provides freight transportation servicesThe Kenan Advantage Group,Inc.10/13/2020LogisticsAgro Merchants GroupOwns and operates temperature-controlled warehouse and distributionspace in North America, Latin America, and EuropeAmericold10/7/2020LogisticsValue LogisticsProvides intermodal transportation services in the United StatesForward AirPAGE 4
TRANSPORTATION& LOGISTICSINDUSTRY UPDATE DECEMBER 2020Our GroupHARRIS WILLIAMS IS A LEADING ADVISOR TO THE TRANSPORTATION AND LOGISTICS M&A MARKET.OUR TRANSPORTATION & LOGISTICS GROUP SERVES COMPANIES IN A BROAD RANGE OF ATTRACTIVENICHES, INCLUDING THIRD-PARTY LOGISTICS (3PL), TRUCK, RAIL, MARINE AND AIRTRANSPORTATION, TRANSPORTATION EQUIPMENT, AND THE AUTOMOTIVE AND HEAVY DUTYVEHICLE MARKET.RECENTLY CLOSED T&L DEALSDEEP EXPERIENCE ACROSS T&L SECTORSAUTOMOTIVE &HEAVY DUTYVEHICLERAIL & T ANDAVIATION SERVICESPAGE 5
TRANSPORTATION& LOGISTICSINDUSTRY UPDATE DECEMBER 2020Our FirmHARRIS WILLIAMS HAS A BROAD RANGE OF INDUSTRY EXPERTISE, WHICH CREATES POWERFULOPPORTUNITIES. OUR CLIENTS BENEFIT FROM OUR DEEP SECTOR EXPERIENCE, INTEGRATEDINDUSTRY INTELLIGENCE AND COLLABORATION ACROSS THE FIRM, AND OUR COMMITMENT TOLEARNING WHAT MAKES THEM UNIQUE. FOR MORE INFORMATION, VISIT OUR WEBSITE ATWWW.HARRISWILLIAMS.COM/INDUSTRIESAerospace, Defense& GovernmentServicesBuilding Products& MaterialsBusinessServicesConsumerEnergy, Power& InfrastructureHealthcare& Life GroupTransportation& LogisticsHarris Williams Office LocationsUNITED STATESBOSTONOne International PlaceSuite 2620Boston, Massachusetts 02110Phone: 1 (617) 482-7501CLEVELAND1900 East 9th Street20th FloorCleveland, Ohio 44114Phone: 1 (216) 689-2400MINNEAPOLIS222 South 9th StreetSuite 3350Minneapolis, Minnesota 55402Phone: 1 (612) 359-2700RICHMOND(HEADQUARTERS)1001 Haxall Point9th FloorRichmond, Virginia 23219Phone: 1 (804) 648-0072SAN FRANCISCO575 Market Street31st FloorSan Francisco, California 94105Phone: 1 (415) 288-4260EUROPEFRANKFURTBockenheimer Landstrasse 33-3560325 FrankfurtGermanyPhone: 49 069 3650638 00LONDON63 Brook StreetLondon W1K 4HS, EnglandPhone: 44 (0) 20 7518 8900WASHINGTON, D.C.800 17th St. NW2nd FloorWashington, D.C. 20006Phone: 1 202-207-2300PAGE 6
TRANSPORTATION & LOGISTICSINDUSTRY UPDATE DECEMBER 2020Public Comparables(1)Revenue( in millions)20162017201820192020EAvg. Revenue Avg. EBITDA Growth'16-19'19-212021PTransportation & LogisticsLogi s tics Provi dersAi r Tra ns port Servi ces Group, Inc. 769 1,068 892 1,452 1,586 1,73223.6%9.2% 205 250 312 436 489 53628.6%10.9%Atl a s Ai r Worl dwi de Hol di ngs , 474827886849.3%19.1%C.H. Robi ns on Worl dwi de, 1854994873750885(1.0%)0.6%Deuts che Pos t 55,5504,7575,43110,14410,9836.2%42.2%DSV Pa na l pi na 58699051,0852,1902,48322.2%51.3%Echo Gl oba l Logi s tics , 6749213.2%27.8%Expedi tors Interna tiona l of Wa s hi ngton, )37.0%Forwa rd Ai r Corpora 91631601191514.8%(2.8%)Hub Group, 0626923227824.0%1.6%J.B. Hunt Tra ns port Servi ces , ,0071,1171,2561,2321,4365.6%6.9%Kuehne Na gel Interna tiona l 491,1721,1831,2752,0672,0976.7%28.2%La nds tar Sys tem, .2%3.2%Roa drunner Tra ns portation Sys tems , Inc.2,0332,0912,2161,848Ryder Sys tem, Inc.6,7587,2808,4148,926FedEx Corpora tionTFI Interna tiona l Inc.Uni ted Pa rcel Servi ce, Inc.Uni vers a l Logi s tics Hol di ngs , Inc.XPO Logi s tics , %3.5%838814916515120525.6%11.4%14,619 263,43415,381 302,80717,279 323,41416,648 332,27015,826 352,96017,059 375,2024.4%8.0%1.2%6.3%1,131 27,9931,284 31,9451,541 32,0351,663 29,8141,309 40,9081,699 47,12513.7%2.1%1.1%25.7%14.4%Trucki ngArcBes t Corpora tion 2,700 2,826 3,094 2,988 2,925 3,1563.4%2.8% 135 154 232 188 212 24611.8%Covena nt Logi s tics Group, 2.5%)3.1%Hea rtla nd Expres s , 16.8%12.7%43343853351454559068Sa i a , 4427131237320.2%17.3%Uni vers a l Logi s tics Hol di ngs , %1.7%31935544545348555212.4%10.4%4,698 18,6564,891 21,1345,092 26,4984,871 25,9464,518 24,5694,889 26,9591.2%11.6%0.2%1.9%270 2,394246 2,704260 3,933160 3,740172 4,118302 4,895(16.0%)16.0%37.4%14.4%Kni ght-Swi ft Tra ns portation Hol di ngs Inc.Ma rten Tra ns port, Ltd.Ol d Domi ni on Frei ght Li ne, Inc.P.A.M. Tra ns portation Servi ces , Inc.USA Truck, Inc.Werner Enterpri s es , Inc.YRC Worl dwi de Inc.TotalNANA5.9%NANANA7.9%PAGE 7NA
TRANSPORTATION & LOGISTICSINDUSTRY UPDATE DECEMBER 2020Public Comparables(1)Revenue( in millions)20162017201820192020EAvg. Revenue Avg. EBITDA Growth'16-19'19-212021PTransportation & LogisticsRa i l a nd Ra i l Servi cesCa na di a n Na tiona l Ra i l wa y Compa ny 8,961 10,399 10,495 11,501 10,815 11,8348.7%1.4% 4,867 5,453 5,241 5,788 5,327 (21.5%)14(13)(20)(40)(42)(9)(243.7%)(52.5%)Fi rs tGroup pl 7566231,314(4.7%)31.8%The Greenbri er Compa ni es , 6283256258206(17.6%)(10.3%)Ka ns a s Ci ty 41,2431,3151,4061,4011,5837.8%6.1%Norfol k Southern Corpora 1044,6455,1245,1914,5855,3658.1%1.7%Tri ni ty Indus tri es , 515529659546573(1.2%)(6.7%)Ca na di a n Pa ci fi c Ra i l wa y Li mi tedCSX Corpora tionFrei ghtCa r Ameri ca , Inc.Uni on Pa ci fi c Corpora 9,31010,25210,74610,83110,18011,3085.2%2.2%2,931 73,5733,882 77,3444,364 83,8008,200 89,0657,577 81,3587,896 84,73940.9%6.6%(1.9%)(2.5%)536 28,954576 31,598651 33,7861,278 35,6251,433 33,2261,551 37,88433.6%7.2%10.2%3.1% 468 412 380 478 460 5310.7%5.4% 309 259 217 312 321 36211416222622115716324.5%(14.1%)(12)3489843762Ki rby Corpora 074774623583871.1%(8.5%)Ma ts on, 5211367360(4.0%)30.4%Nordi c Ameri ca n Ta nkers Li mi 11.6%)19.6%SEACOR Hol di ngs 0%0.0%Wa btec Corpora tionTotalMa ri neCos tama re Inc.Di a na Shi ppi ng Inc.(Inva l i d Identifi er)Total(Inva l i d Identifi er)(Inva l i d Identifi er)(Inva l i d Identifi er)(Inva l i d Identifi er)(Inva l i d Identifi er)(Inva l i d Identifi er) 5,176 5,784 6,925 6,858 6,087 6,357NA9.8%(InvaNA l i d Identifi(Invaer) l i d Identifi(Invaer) l i d Identifi(Invaer) l i d Identifi(Invaer) l i d Identifi(Invaer) l i d Identifi er)(3.7%) 1,201 1,091 1,180 1,276 1,336 1,4190.3%(289.9%)NA2.0%7.8%(13.8%)NA5.5%Tra ns portation Equi pmentDa na Incorpora ted 5,826 7,209 8,143 8,620 6,872 8,21713.9%(2.4%) 612 787 905 940 577 87715.4%Gentherm Incorpora 2.7%)7.4%The Shyft Group, ,845 9,1801,767 10,3742,267 12,0292,319 12,6671,440 9,8611,779 11,7747.9%11.3%(12.4%)(3.6%)240 1,021174 1,133175 1,249183 1,32366 842128 1,252(8.6%)9.0%Wa ba s h Na tiona l Corpora tionTotalPAGE 8(3.4%)(16.4%)(2.7%)
TRANSPORTATION & LOGISTICSINDUSTRY UPDATE DECEMBER 2020Public Comparables(1)( in millions except per share data)Stock PerformanceChange fromPrior MonthPrior YearStock PriceCurrentTEV52-WeekHigh% of HighTEV / LTM EBITDA as ofJun-20Dec-19TEV / EBITDACurrent2020E2021PTransportation & LogisticsLogistics ProvidersAir Transport Services Group, Inc. 3,288 30.737.4%32.1% 31.7096.9%6.7x6.0x6.4x6.7xAtlas Air Worldwide Holdings, 5.3xC.H. Robinson Worldwide, 2x18.0x15.3xDeutsche Post 0xDSV Panalpina 7.8x15.7xEcho Global Logistics, Inc.Expeditors International of Washington, Inc.FedEx 93.5%8.3x8.3x9.6x16.8x11.5xForward Air x18.8x14.8xHub Group, .3xJ.B. Hunt Transport Services, 12.6x10.8xKuehne Nagel International .2x15.2x13.9xLandstar System, Inc.Roadrunner Transportation Systems, Inc.Ryder System, Inc.TFI International Inc.United Parcel Service, Inc.Universal Logistics Holdings, Inc.XPO Logistics, anTruckingArcBest Corporation 1,139 42.4714.5%49.6% 46.2591.8%3.5x3.1x5.2x5.4x4.6x430 16.18(8.1%)122.9% 20.7078.2%3.8x4.7x3.9x4.8x4.2xHeartland Express, .0x6.2xKnight-Swift Transportation Holdings .2xMarten Transport, x6.2x22,88
11/12/2020 Logistics Capstone Logistics Diversified 3PL offering technology-enhanced, outsourced supply chain solutions from point-of-origin to final destination H.I.G. Capital 11/12/2020 Logistics GoConfigure Provides consumer delivery, assembly, and installation
