Werner Enterprises is pausing a bit from acquisitions, CEO Derek Leathers noted at the Morgan Stanley 11th Annual Laguna Conference Tuesday.
Leathers clarified ongoing remarks about how the carrier is focusing on integrating acquisitions and repeated how the truckload provider is still open to opportunities.
“We've kind of consciously signaled a little bit of a time-out, but we're still open and looking for deals all the time," said Leathers, who is also president of the company and the chairman of the board.
A series of companies are providing remarks and greater context to quarterly earnings remarks and public announcements during the three-day investor conference in California.
On Tuesday, Leathers noted that the carrier will focus first and foremost on investing in the business. “We’re going to be careful for now,” he said, adding that Werner is working to improve margins.
While valuations rose during the COVID-19 pandemic, they’ve since improved, according to Leathers. But there can be cautionary tales about underlying assets during trying times. Leathers suggested that maintaining equipment and the ability for a business to invest in itself in recent quarters can make M&A less favorable.
Werner acquired ReedTMS Logistics in November 2022, Baylor Trucking in October 2022 and NEHDS in November 2021. The carrier also obtained an 80% equity ownership stake in ECM Transport Group in July 2021.
Those acquisitions are still realizing their full potential. EVP, Treasurer and CFO Chris Wickoff said last month on a Q2 earnings call that the carrier is continuing to integrate those four acquisitions.
The remarks echoed Leathers’ input from earlier this year for a Q4 earnings call in February regarding M&A. “There's obviously going to be a lot of opportunity out there over the next 12 months. There's a lot of folks looking for an exit,” Leathers said.
Noting those four acquisitions, Leathers said on the earnings call that he wants them integrated. “I want to see them all functioning as one,” he said.
