[10-Q] PAM Transportation Services Quarterly Earnings Report

Rhea-AI Filing Summary

PAMT CORP (PTSI) reported a weaker first half of 2025 as freight volumes and rates declined, driving a wider loss and higher leverage despite solid cash and investment balances. Total operating revenue fell to $306.5 million for the six months ended June 30, 2025 from $365.5 million a year earlier, principally from lower truckload and brokerage volumes and lower rates per mile. The company recorded a six-month net loss of $17.8 million (diluted loss per share $0.83) versus a $2.6 million loss in 2024.

Liquidity includes $68.9 million of cash and $48.4 million of marketable equity securities (net unrealized gain $18.2 million). Long-term debt was $331.2 million, and the company disclosed a covenant breach of its credit facility as of June 30, 2025 but obtained a lender waiver on August 7, 2025. Management completed a sizable tender repurchase of 870,000 shares for ~$14.8 million and expects ~$25.1 million of net capital expenditures for the remainder of 2025.

Insights

Financial Analyst

TL;DR: Freight recession reduced volumes and rates, producing a materially wider loss and higher leverage despite healthy cash and investments.

The company experienced a significant downturn in operating performance: second-quarter operating revenues declined from $182.9M to $151.1M year-over-year and six-month revenues declined ~16%. Net loss widened to $17.8M for the six-month period, driving diluted loss per share to $0.83. Truckload operating ratio deteriorated to 111.7% for the six months, showing operating expenses (including higher depreciation and purchased transportation) exceed freight revenue before fuel surcharge.

Balance sheet and liquidity show positives—$68.9M cash and a marketable securities portfolio of $48.4M with an $18.2M unrealized gain—which provide near-term flexibility. However, rising long-term debt ($331.2M) and higher interest costs pressure coverage metrics and drove a covenant breach that required a lender waiver.

Credit/Risk Analyst

TL;DR: Credit profile weakened due to lower adjusted EBITDA and higher funded debt; covenant waiver mitigates immediate default risk but uncertainty remains.

The company reported deterioration in operating performance that reduced rolling four-quarter adjusted EBITDA and raised the debt-to-adjusted-EBITDA ratio above the 4.00x covenant threshold. Long-term debt increased to $331.2M and interest costs rose as the weighted average rate moved to ~5.10%. Management obtained a waiver for the June 30, 2025 covenant breach on August 7, 2025, avoiding default.

Near-term liquidity indicators (unused credit availability ~$59.8M, cash balance ~$68.9M, and operating cash flow of $17.2M YTD) reduce immediate refinancing risk, but recurring operating losses, planned capital spending (~$25.1M remaining in 2025), and the need to renegotiate covenant terms present ongoing credit risk.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2025

or

☐    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________to__________

PAMT CORP

(Exact name of registrant as specified in its charter)

Nevada	0-1507	71-0633135
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification no.)

297 West Henri De Tonti, Tontitown, Arkansas 72770

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (479) 361-9111

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	PAMT	NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to the filing requirements for the past 90 days. Yes  ☑ No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files.)

Yes  ☑ No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☑
Non-accelerated filer ☐	Smaller reporting company ☑
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐    No  ☑ 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Class		Outstanding at July 22, 2025
Common Stock, $.01 Par Value		20,926,020

Table of Contents

PAMT CORP

Form 10-Q

For the Quarter Ended June 30, 2025

Table of Contents

Part I. Financial Information
Item 1.	Financial Statements (unaudited).	3
	Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024	3
	Condensed Consolidated Statements of Operations for the Six Months Ended June 30, 2025 and 2024	4
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024	5
	Condensed Consolidated Statement of Stockholders’ Equity for the Six Months Ended June 30, 2025 and 2024	6
	Notes to Condensed Consolidated Financial Statements as of June 30, 2025	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	15
Item 3.	Quantitative and Qualitative Disclosures about Market Risk.	21
Item 4.	Controls and Procedures.	22
Part II. Other Information
Item 1.	Legal Proceedings.	23
Item 1A.	Risk Factors.	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	24
Item 5.	Other Information.	24
Item 6.	Exhibits.	25
Signatures		26

2

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands, except share and per share data)

		June 30,				December 31,
		2025				2024
ASSETS
Current assets:
Cash and cash equivalents		$	68,915			$	68,060
Accounts receivable-net:
Trade, less current estimated credit loss of $7,013 and $6,636, respectively			75,683				79,967
Other			5,136				4,854
Inventories			2,382				2,433
Prepaid expenses and deposits			8,523				11,555
Marketable equity securities			48,384				42,620
Income taxes refundable			-				2,281
Total current assets			209,023				211,770
Property and equipment:
Land			30,337				30,426
Structures and improvements			56,858				53,620
Revenue equipment			672,646				733,181
Office furniture and equipment			16,199				19,263
Total property and equipment			776,040				836,490
Accumulated depreciation			(281,194	)			(309,272	)
Net property and equipment			494,846				527,218
Other assets			3,998				2,666
TOTAL ASSETS		$	707,867			$	741,654
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	30,964			$	31,198
Accrued expenses and other liabilities			16,614				14,569
Income tax payable			1,774				-
Current maturities of long-term debt			68,827				73,017
Total current liabilities			118,179				118,784
Long-term debt - less current portion			262,406				252,565
Deferred income taxes			81,790				92,547
Other long-term liabilities			578				250
Total liabilities			462,953				464,146
COMMITMENTS AND CONTINGENCIES (Note L)
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued			-				-
Common stock, $.01 par value, 100,000,000 shares authorized; 22,377,606 and 22,364,120 shares issued; 20,926,020 and 21,782,534 shares outstanding at June 30, 2025 and December 31, 2024, respectively			224				224
Additional paid-in capital			41,274				41,171
Treasury stock, at cost; 1,451,586 and 581,586 shares at June 30, 2025 and December 31, 2024, respectively			(28,924	)			(13,996	)
Retained earnings			232,340				250,109
Total stockholders’ equity			244,914				277,508
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	707,867			$	741,654

See notes to condensed consolidated financial statements.

3

Table of Contents

PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(unaudited)

(in thousands, except per share data)

		Three Months Ended June 30,								Six Months Ended June 30,
		2025				2024				2025				2024
OPERATING REVENUES:
Revenue, before fuel surcharge		$	133,806			$	160,213			$	270,506			$	321,182
Fuel surcharge			17,328				22,735				35,969				44,358
Total operating revenues			151,134				182,948				306,475				365,540
OPERATING EXPENSES AND COSTS:
Salaries, wages and benefits			40,851				43,759				81,665				87,822
Operating supplies and expenses			29,028				35,309				60,413				70,020
Rent and purchased transportation			64,866				74,803				127,838				148,082
Depreciation			21,719				18,705				44,315				37,640
Insurance and claims			5,167				5,464				9,948				10,325
Other			4,986				5,752				9,985				12,931
(Gain)/Loss on disposition of equipment			(4,414	)			(139	)			(7,428	)			101
Total operating expenses and costs			162,203				183,653				326,736				366,921
OPERATING LOSS			(11,069	)			(705	)			(20,261	)			(1,381	)
NON-OPERATING INCOME			2,263				209				4,749				4,147
INTEREST EXPENSE			(4,032	)			(3,284	)			(8,075	)			(6,167	)
LOSS BEFORE INCOME TAXES			(12,838	)			(3,780	)			(23,587	)			(3,401	)
FEDERAL AND STATE INCOME TAX (BENEFIT)/EXPENSE:
Current			(3,758	)			(47	)			4,940				59
Deferred			547				(823	)			(10,757	)			(831	)
Total federal and state income tax (benefit)/expense			(3,211	)			(870	)			(5,817	)			(772	)
NET LOSS		$	(9,627	)		$	(2,910	)		$	(17,770	)		$	(2,629	)
LOSS PER COMMON SHARE:
Basic		$	(0.46	)		$	(0.13	)		$	(0.83	)		$	(0.12	)
Diluted		$	(0.46	)		$	(0.13	)		$	(0.83	)		$	(0.12	)
AVERAGE COMMON SHARES OUTSTANDING:
Basic			21,095				21,932				21,498				21,981
Diluted			21,095				21,932				21,498				21,981

See notes to condensed consolidated financial statements.

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PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(unaudited)

(in thousands)

		Six Months Ended
		June 30,
		2025				2024
OPERATING ACTIVITIES:
Net loss		$	(17,770	)		$	(2,629	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation			44,315				37,640
Bad debt expense			379				2,406
Stock compensation-net of excess tax benefits			140				393
Provision for deferred income taxes			(10,757	)			(831	)
Gain on marketable equity securities			(2,371	)			(1,434	)
(Gain) Loss on sale or disposition of equipment			(7,428	)			101
Changes in operating assets and liabilities:
Accounts receivable			3,623				(13,366	)
Prepaid expenses, deposits, inventories, and other assets			2,663				5,589
Income taxes refundable			2,281				-
Income taxes payable			1,774				(590	)
Trade accounts payable			(382	)			1,176
Accrued expenses and other liabilities			739				(185	)
Net cash provided by operating activities			17,206				28,270
INVESTING ACTIVITIES:
Purchases of property and equipment			(18,149	)			(36,441	)
Proceeds from disposition of equipment			29,235				17,707
Sales of marketable equity securities			743				2,631
Purchases of marketable equity securities			(4,136	)			-
Net cash provided (used) by investing activities			7,693				(16,103	)
FINANCING ACTIVITIES:
Borrowings under lines of credit			324,864				384,836
Repayments under lines of credit			(324,864	)			(384,836	)
Borrowings of long-term debt			30,000				-
Repayments of long-term debt			(39,801	)			(35,538	)
Borrowings under margin account			1,821				-
Repayments under margin account			(1,136	)			-
Repurchases of common stock			(14,928	)			(5,259	)
Net cash used in financing activities			(24,044	)			(40,797	)
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH			855				(28,630	)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH -Beginning of period			68,060				100,614
CASH, CASH EQUIVALENTS AND RESTRICTED CASH -End of period		$	68,915			$	71,984
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest		$	7,985			$	6,193
Income taxes		$	886			$	669
NONCASH INVESTING AND FINANCING ACTIVITIES:
Purchases of property and equipment included in accounts payable		$	362			$	1,353

See notes to condensed consolidated financial statements.

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PAMT CORP AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited)

(in thousands)

		Common Stock Shares / Amount								Additional Paid-In Capital				Treasury Stock				Retained Earnings				Total
Balance at January 1, 2025			21,783			$	224			$	41,171			$	(13,996	)		$	250,109			$	277,508
Net loss			-				-				-				-				(8,142	)			(8,142	)
Restricted stock issued			8				-				(37	)			-				-				(37	)
Stock based compensation			-				-				266				-				-				266
Balance at March 31, 2025			21,791			$	224			$	41,400			$	(13,996	)		$	241,967			$	269,595
Net Loss			-				-				-				-				(9,627	)			(9,627	)
Treasury stock repurchases			(870	)			-				-				(14,928	)			-				(14,928	)
Restricted stock issued			5				-				-				-				-				-
Stock based compensation			-				-				(126	)			-				-				(126	)
Balance at June 30, 2025			20,926			$	224			$	41,274			$	(28,924	)		$	232,340			$	244,914

		Common Stock Shares / Amount								Additional Paid-In Capital				Treasury Stock				Retained Earnings				Total
Balance at January 1, 2024			22,021			$	223			$	40,825			$	(8,736	)		$	281,904			$	314,216
Net Income			-				-				-				-				281				281
Restricted stock issued			14				-				(46	)			-				-				(46	)
Stock based compensation			-				-				192				-				-				192
Balance at March 31, 2024			22,035			$	223			$	40,971			$	(8,736	)		$	282,185			$	314,643
Net Loss			-				-				-				-				(2,910	)			(2,910	)
Treasury stock repurchases			(285	)			-				-				(5,259	)			-				(5,259	)
Restricted stock issued			5				-				-				-				-				-
Stock based compensation			-				-				200				-				-				200
Balance at June 30, 2024			21,755			$	223			$	41,171			$	(13,995	)		$	279,275			$	306,674

See notes to condensed consolidated financial statements.

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PAMT CORP AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited)

June 30, 2025

NOTE A: BASIS OF PRESENTATION

In accordance with generally accepted accounting principles (“GAAP”) and applicable rules of the Securities and Exchange Commission, the information reported in this Quarterly Report on Form 10-Q for PAMT CORP and its legally distinct subsidiaries, unless otherwise indicated, is presented on a consolidated basis. Unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q to the “Company,” “we,” “our,” or “us” mean PAMT CORP and its consolidated subsidiaries.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In management’s opinion, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation have been included. The consolidated balance sheet at December 31, 2024 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Operating results for the six-month period ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. For further information, refer to the consolidated financial statements and the footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2024.

NOTE B: RECENT ACCOUNTING PRONOUNCEMENTS

In November 2023, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update (“ASU”) 2023-07, Improvements to Reportable Segment Disclosures (Topic 280). ASU 2023-07 expands disclosures related to a public entity's reportable segment and requires more enhanced information about significant segment expenses, including in interim periods. This ASU is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, using a retrospective approach. The Company adopted this standard on a retrospective basis for the 2024 annual period, and for interim periods beginning January 1, 2025. See Note F, “Segment Information,” for further information. ASU 2023-07 had no material impact on the Company’s financial condition, results of operations, or cash flows.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures. ASU 2023-09 was issued to enhance the transparency and decision usefulness of income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The guidance is effective for annual reporting periods beginning after December 15, 2024, with early adoption permitted. The Company has evaluated the new guidance and does not expect it to have a material impact on its financial condition, results of operations, or cash flows.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses. ASU 2024-03 was issued to enhance the transparency of financial reporting by requiring public business entities to provide more detailed disclosures about certain operating expenses. The FASB also issued ASU 2025-01 in January clarifying that ASU 2024-03 is effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company has evaluated the new guidance and does not expect it to have a material impact on its financial condition, results of operations, or cash flows.

NOTE C: REVENUE RECOGNITION

The Company has a single performance obligation to transport our customers’ freight from a specified origin to a specified destination. The Company has the discretion to choose to self-transport or to arrange for alternate transportation to fulfill the performance obligation. Where the Company decides to self-transport the freight, the Company classifies the service as truckload services, and where the Company arranges for alternate transportation of the freight, the Company classifies the service as brokerage and logistics services. In either case, the Company is paid a rate to transport freight from its origin location to a specified destination. Because the primary factors influencing revenue recognition, including performance obligation, customer base, and timing of revenue recognition are the same for both of its service categories, the Company utilizes the same revenue recognition method throughout its operations.

Company revenue is generated from freight transportation services performed utilizing heavy truck trailer combinations. While various ownership arrangements may exist for the equipment utilized to perform these services, including Company-owned or leased, owner-operator owned, and third-party carriers, revenue is generated from the same base of customers. Contracts with these customers establish rates for services performed, which are predominantly rates that will be paid to pick up, transport and drop off freight at various locations. In addition to transportation, revenue is also awarded for various accessorial services performed in conjunction with the base transportation service. The Company also has other revenue categories that are not discussed in this note or broken out in our consolidated statements of operations due to their immaterial amounts.

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In fulfilling the Company’s obligation to transport freight from a specified origin to a specified destination, the control of freight is transferred to the Company at the point it has been loaded into the driver’s trailer, the doors are sealed and the driver has signed a bill of lading, which is the basic transportation agreement that establishes the nature, quantity and condition of the freight loaded, responsibility for invoice payment, and pickup and delivery locations. The Company’s revenue is generated, and our customer receives benefit, as the freight progresses towards delivery locations. In the event the Company’s customer cancels the shipment at some point prior to the final delivery location and re-consigns the shipment to an alternate delivery location, the Company is entitled to receive payment for services performed for the partial shipment. Shipments are generally conducted over a relatively short time span, generally one to three days; however, freight is sometimes stored temporarily in our trailer at one of our drop yard locations or at a location designated by a customer. The Company’s revenue is categorized as either Freight Revenue or Fuel Surcharge Revenue, and both are earned by performing the same freight transportation services, as discussed further below.

Freight Revenue – revenue generated by the performance of the freight transportation service, including any accessorial service, provided to customers.

Fuel Surcharge Revenue – revenue designed to adjust freight revenue rates to an agreed-upon base cost for diesel fuel. Diesel fuel prices can fluctuate widely during the term of a contract with a customer. At the point that freight revenue rates are negotiated with customers, a sliding scale is agreed upon that systematically adjusts diesel fuel costs to an agreed-upon base amount. In general, as fuel prices increase, revenue from fuel surcharge increases, so that diesel fuel cost is adjusted to the approximate agreed upon base amount.

Revenue is recognized over time as the freight progresses towards its destination and the transportation service obligation is fulfilled. For loads picked up during the reporting period, but delivered in a subsequent reporting period, revenue is allocated to each period based on the transit time in each period as a percentage of total transit time. The contract asset, or the amount of remaining performance obligation relating to loads in process, at June 30, 2025 was $3.0 million compared to $2.3 million at December 31, 2024. Recorded contract assets are included in the accounts receivable line item of the balance sheet. Corresponding liabilities are recorded in the accrued expenses and other liabilities line items for the estimated expenses on these same in-process loads. The Company had no contract liabilities associated with our operations as of June 30, 2025 and December 31, 2024, respectively.

The Company recognizes operating lease revenue from leasing tractors and related equipment to third parties, including independent contractors. Operating lease revenue from rental operations is recognized in revenue as it is earned. Upon lease termination, losses may be incurred in the recovery of leased equipment which are recognized as an expense in the period in which they are incurred.

NOTE D: MARKETABLE EQUITY SECURITIES

The Company’s investments in marketable securities consist of equity securities with readily determinable fair values. The cost of securities sold is based on the specific identification method, and interest and dividends on securities are included in non-operating income.

Marketable equity securities are carried at fair value, with gains and losses in fair market value included in the determination of net income. The fair value of marketable equity securities is determined based on quoted market prices in active markets, as described in Note J.

The following table sets forth market value, cost, and unrealized gains on equity securities as of June 30, 2025 and December 31, 2024.

		June 30, 2025				December 31, 2024
		(in thousands)
Fair market value		$	48,384			$	42,620
Cost			30,197				27,094
Unrealized gain		$	18,187			$	15,526

The following table sets forth the gross unrealized gains and losses on the Company’s marketable securities as of June 30, 2025 and December 31, 2024.

		June 30, 2025				December 31, 2024
		(in thousands)
Gross unrealized gains		$	19,820			$	17,215
Gross unrealized losses			1,633				1,689
Net unrealized gain		$	18,187			$	15,526

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The following table shows the Company’s net realized gains during the three and six months ending on June 30, 2025 and 2024, respectively, on certain marketable equity securities.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2025				2024				2025				2024
		(in thousands)
Sales proceeds		$	742			$	2,631			$	743			$	2,631
Cost of securities sold			1,030				2,815				1,034				2,815
Realized loss		$	(288	)		$	(184	)		$	(291	)		$	(184	)

For the quarter ended June 30, 2025, the Company recognized dividends received of approximately $392,000 in non-operating income in its condensed consolidated statements of operations. For the six months ended June 30, 2025, the Company recognized dividends received of approximately $835,000 in non-operating income in its condensed consolidated statements of operations.

The Company’s equity securities are periodically used as collateral against any outstanding margin account borrowings. As of June 30, 2025, the Company had outstanding borrowings of approximately $685,000 under its margin account, compared to no outstanding borrowings under its margin account at December 31,2024. Margin account borrowings, when utilized, are used for the purchase of marketable equity securities and as a source of short-term liquidity and are included in accrued expenses and other liabilities on our condensed consolidated balance sheets.

Our marketable equity securities portfolio had a net unrealized pre-tax gain in market value of approximately $1,058,000 during the second quarter of 2025, and a net unrealized pre-tax loss in market value of approximately $1,153,000 during the second quarter of 2024, which were reported as non-operating income in its condensed consolidated statements of operations for the respective periods.

NOTE E: STOCK-BASED COMPENSATION

The Company maintains a stock incentive plan under which incentive and non-qualified stock options and other stock awards may be granted. On February 15, 2024, the Company’s Board of Directors adopted, and on October 31, 2024, our shareholders approved, the 2024 Equity Incentive Plan, as amended (the “2024 Plan”). Under the 2024 Plan, 1,600,000 shares are reserved for the issuance of stock awards to employees, officers, directors, consultants and advisors of the Company. The stock option exercise price and the restricted stock unit purchase price under the 2024 Plan shall not be less than 100% of the fair market value of the Company’s common stock on the date the award is granted. The fair market value is determined by the closing price of the Company’s common stock, on its primary exchange, on the same date that the option or other award is granted.

During May 2025, the Company granted 2,862 shares of common stock to non-employee directors. This stock award had a grant date fair value of $15.71 per share, based on the closing price of the Company’s stock on the date of grant, and vested immediately.

Prior to the 2024 Plan, the Company maintained the 2014 Amended and Restated Stock Option and Incentive Plan (the “2014 Plan”), which was adopted by the Company’s Board of Directors in March 2014 and approved by the Company’s shareholders in May 2014. Under the 2014 Plan, 3,000,000 shares (as adjusted for the Company’s 2-for-1 forward splits of its common stock paid in August 2021 and March 2022, respectively) were reserved for the issuance of stock awards to directors, officers, key employees, and others. The stock option exercise price and the restricted stock purchase price under the 2014 Plan were not to be less than 85% of the fair market value of the Company’s common stock on the date the award is granted. The fair market value was determined by the closing price of the Company’s common stock, on its primary exchange, on the same date that the option or award was granted. The 2014 Plan expired on March 13, 2024, and no further grants may be made under this plan. All outstanding unvested awards granted under the 2014 Plan, however, remain subject to the terms and conditions of the 2014 Plan.

The total grant date fair value of stock vested during the first six months of 2025 was approximately $437,000. The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first six months of 2025, was approximately $140,000 and includes approximately $45,000 recognized as a result of the issuance of shares to certain non-employee directors. The recognition of stock-based compensation expense decreased both diluted and basic earnings per common share by approximately $0.01 during the first six months of 2025. As of June 30, 2025, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $1,147,000, which is being amortized on a straight-line basis over the remaining vesting period. As a result, the Company expects to recognize approximately $336,000 in additional compensation expense related to unvested stock awards during the remainder of 2025 and to recognize approximately $304,000, $242,000, and $233,000 in additional compensation expense related to unvested stock-based awards during the years 2026, 2027, and 2028, respectively.

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The total grant date fair value of stock vested during the first six months of 2024 was approximately $550,000. The total pre-tax stock-based compensation expense, recognized in salaries, wages and benefits during the first six months of 2024, was approximately $393,000 and included approximately $38,000 recognized as a result of the issuance of shares to certain non-employee directors. The recognition of stock-based compensation expense decreased both diluted and basic earnings per common share by approximately $0.01 during the first six months of 2024. As of June 30, 2024, the Company had stock-based compensation plans with total unvested stock-based compensation expense of approximately $1,779,000, which was being amortized on a straight-line basis over the remaining vesting period.

A summary of the status of the Company’s non-vested stock awards as of June 30, 2025, and changes during the six months ended June 30, 2025, is as follows:

		Stock Awards
		Number of Shares				Weighted- Average Grant Date Fair Value
Non-vested at January 1, 2025			128,591			$	13.79
Unrestricted Shares Issued			102,862				16.09
Canceled/forfeited/expired			(141,329	)			11.90
Vested			(15,862	)			27.52
Non-vested at June 30, 2025			74,262			$	17.64

NOTE F: SEGMENT INFORMATION

The Company follows the guidance provided by ASC Topic 280, Segment Reporting, in its identification of operating segments. The Company has determined that it has a total of two operating segments whose primary operations can be characterized as either Truckload Services or Brokerage and Logistics Services; however, in accordance with the aggregation criteria provided by FASB ASC Topic 280, the Company has determined that the operations of the two operating segments can be aggregated into a single reportable segment. Both our truckload operations and our brokerage/logistics operations have similar qualitative and quantitative economic characteristics and are impacted by virtually the same economic factors. Based on the Company’s segment identification, interpretation of the aggregation criteria outlined in ASC 280-10-50-11, and the similar qualitative and quantitative economic characteristics of the Company’s operating segments, the operations of the Company are aggregated into a single motor carrier segment. The Company’s chief operating decision maker, the Chief Executive Officer, utilizes the metrics of net income and operating ratio to evaluate company performance and in competitive analysis when comparing to competing companies.

Truckload Services revenues and Brokerage and Logistics Services revenues, each before fuel surcharges, were as follows:

		Three Months Ended June 30,																Six Months Ended June 30,
		2025								2024								2025								2024
		Amount				%				Amount				%				Amount				%				Amount				%
		(in thousands)
Truckload Services revenue		$	92,824				69.4			$	106,554				66.5			$	185,253				68.5			$	208,754				65.0
Brokerage and Logistics Services revenue			40,982				30.6				53,659				33.5				85,254				31.5				112,428				35.0
Total revenues		$	133,806				100.0			$	160,213				100.0			$	270,507				100.0			$	321,182				100.0

The Company provides truckload transportation services as well as brokerage and logistics services to customers throughout the United States and portions of Canada and Mexico. The table below presents revenue dollars and percentages, each including fuel surcharges, by geographic area:

		Three Months Ended June 30,																Six Months Ended June 30,
		2025								2024								2025								2024
		Amount				%				Amount				%				Amount				%				Amount				%
		(in thousands, except percentage data)
United States - domestic shipments		$	84,304				55.8			$	117,817				64.4			$	168,149				54.9			$	236,719				64.7
Shipments to or from Mexico		$	66,537				44.0			$	64,821				35.4			$	137,634				44.9			$	128,209				35.1
Shipments to or from Canada		$	293				0.2			$	310				0.2			$	693				0.2			$	612				0.2
Total		$	151,134				100.0			$	182,948				100.0			$	306,476				100.0			$	365,540				100.0

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NOTE G: TREASURY STOCK

The Company’s stock repurchase program has been extended and expanded several times, most recently in July 2023, when the Board of Directors reauthorized 500,000 shares of common stock for repurchase under the initial September 2011 authorization. As of June 30, 2025, there remain 474,016 shares of common stock authorized for repurchase under this plan.

On April 3, 2025, the Company commenced a tender offer to repurchase up to 435,000 shares of the Company’s outstanding common stock at a price of not greater than $17.00 nor less than $14.00 per share. On April 11, 2025, the Company amended the terms of the tender offer to increase the minimum purchase price for shares purchased in the tender offer to $14.50 per share. Following the expiration of the tender offer on May 1, 2025, the Company accepted 870,000 shares of its common stock for purchase at $17.00 per share, at an aggregate purchase price of approximately $14.8 million, excluding fees and expenses related to the offer. The number of shares purchased by the Company reflects the Company’s right to purchase additional shares in the tender offer up to an additional 2% of its outstanding shares. The Company funded the purchase of the accepted shares tendered with available cash and accounted for the repurchase of these shares as treasury stock on the Company’s condensed consolidated balance sheet as of June 30, 2025.

The Company accounts for treasury stock using the cost method. As of June 30, 2025, 1,451,586 shares were held in the treasury at an aggregate cost of approximately $28,924,000.

NOTE H: EARNINGS PER SHARE

Basic earnings per share is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by adjusting the weighted average number of shares of common stock outstanding by common stock equivalents attributable to dilutive restricted stock. The computation of diluted earnings per share does not assume conversion, exercise, or contingent issuance of securities that would have an anti-dilutive effect on earnings per share. The computations of basic and diluted earnings per share were as follows:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2025				2024				2025				2024
		(in thousands, except per share data)
Net Loss		$	(9,627	)		$	(2,910	)		$	(17,770	)		$	(2,629	)
Basic weighted average common shares outstanding			21,095				21,932				21,498				21,981
Dilutive effect of common stock equivalents			-				-				-				-
Diluted weighted average common shares outstanding			21,095				21,932				21,498				21,981
Basic loss per share		$	(0.46	)		$	(0.13	)		$	(0.83	)		$	(0.12	)
Diluted loss per share		$	(0.46	)		$	(0.13	)		$	(0.83	)		$	(0.12	)

NOTE I: INCOME TAXES

The Company and its subsidiaries are subject to U.S. and Canadian federal income tax laws as well as the income tax laws of multiple state jurisdictions. The major tax jurisdictions in which the Company operates generally provide for a deficiency assessment statute of limitations period of three years, and as a result, the Company’s tax years 2021 and forward remain open to examination in those jurisdictions.

In determining whether a tax asset valuation allowance is necessary, management, in accordance with the provisions of ASC 740-10-30, Accounting for Income Taxes, weighs all available evidence, both positive and negative, to determine whether, based on the weight of that evidence, a valuation allowance is necessary. If negative conditions exist which indicate a valuation allowance might be necessary, consideration is then given to what effect the future reversals of existing taxable temporary differences and the availability of tax strategies might have on future taxable income to determine the amount, if any, of the required valuation allowance. As of June 30, 2024, management determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the position will be sustained on examination by taxing authorities, based on the technical merits of the position. As of June 30, 2025, an adjustment to the Company’s condensed consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws. The Company recognizes interest and penalties related to uncertain income tax positions, if any, in income tax expense. During the six months ended June 30, 2025 and 2024, the Company has not recognized or accrued any interest or penalties related to uncertain income tax positions.

The Company’s effective income tax rates were 24.7% and 22.7% for the six months ended June 30, 2025 and 2024, respectively. Our effective tax rate for the six months ended June 30, 2025 differs from amounts computed by applying the United States federal statutory rates to pre-tax income primarily due to state income taxes.

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NOTE J: FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company’s financial instruments consist of cash and cash equivalents, marketable equity securities, accounts receivable, trade accounts payable, and borrowings.

The Company follows the guidance for financial assets and liabilities measured on a recurring basis. This guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date and also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

	Level 1:		Quoted market prices in active markets for identical assets or liabilities.
	Level 2:		Inputs other than Level 1 inputs that are either directly or indirectly observable such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable; or other inputs not directly observable, but derived principally from, or corroborated by, observable market data.
	Level 3:		Unobservable inputs that are supported by little or no market activity.

The Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

At June 30, 2025, the following items are measured at fair value on a recurring basis:

		Total				Level 1				Level 2				Level 3
		(in thousands)
Marketable equity securities		$	48,384			$	48,384				-				-

The Company’s investments in marketable securities are recorded at fair value based on quoted market prices. The carrying value of other financial instruments, including cash, accounts receivable, accounts payable, and accrued liabilities approximate fair value due to their short maturities.

The carrying amount for the line of credit approximates fair value because the line of credit interest rate is adjusted frequently.

For long-term debt other than the lines of credit, the fair values are estimated using discounted cash flow analyses, based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements. The carrying value and estimated fair value of this other long-term debt at June 30, 2025 was as follows:

		Carrying Value				Estimated Fair Value
		(in thousands)
Long-term debt		$	331,233			$	331,233

The Company has not elected the fair value option for any of its financial instruments.

NOTE K: NOTES PAYABLE

During the first six months of 2025, the Company’s subsidiaries entered into installment obligations totaling approximately $45.5 million for the purpose of purchasing revenue equipment and other assets. These obligations are payable in monthly installments and are recorded in long-term debt and current maturities on the condensed consolidated balance sheets. The terms of these obligations range from 60 to 84 months.

NOTE L: COMMITMENTS AND CONTINGENCIES

We are involved in certain claims and pending litigation arising from the ordinary conduct of business. We also provide accruals for claims within our self-insured retention amounts. Since September 1, 2020, we have been self-insured for certain layers of auto liability claims in excess of $2.0 million. We currently specifically reserve for claims that are expected to exceed $2.0 million when fully developed, based on the facts and circumstances of those claims. Based on our knowledge of the facts, and in certain cases, opinions of outside counsel, we believe the resolution of such claims and pending litigation will not have a material effect on our financial position, results of operations or cash flows. However, if we experience claims that are not covered by our insurance or that exceed our estimated claim reserve, it could increase the volatility of our earnings and have a materially adverse effect on our financial condition, results of operations or cash flows.

During the first six months of 2025, we maintained a revolving line of credit with a borrowing limit of $60.0 million that contains certain restrictive covenants, which must be maintained by the Company on a consolidated basis. Under the terms of the loan agreement, the Company must maintain a debt to adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization, excluding gains/losses on equity securities and extraordinary items, calculated on a rolling four-quarter basis) ratio of less than 4.00 to 1.00 as of the end of each calendar quarter.

As of June 30, 2025, the Company was not in compliance with this financial covenant. The elevated debt to adjusted EBITDA ratio was primarily the result of increased funded debt related to the purchase of $144.2 million of revenue equipment during 2024, most of which was financed, combined with a decrease in trailing twelve-month adjusted EBITDA due to the phasing out of earlier, more favorable quarters from the rolling four-quarter calculation. The loan agreement provides a 45-day cure period for financial covenant violations, during which the Company is not deemed to be in default of the loan agreement. On August 7, 2025, within the permitted cure period, the Company received a written waiver from the lender for the covenant violation applicable to the period ended June 30, 2025. As a result of the waiver, the Company was not in default under the terms of the credit facility as of June 30, 2025 or as of the date of this filing. The Company is in compliance with all other covenants under the agreement.

At June 30, 2025 we had no outstanding borrowings against the line of credit and approximately $0.2 million of outstanding letters of credit, with availability to borrow $59.8 million.

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NOTE M: LEASES

The Company currently leases shop, office and parking spaces in various locations in the United States and Mexico. The initial term for the majority of these leases is one year or less, with an option for early cancellation and an option to renew for subsequent one- month periods. These leases can be terminated by either party by providing notice to the other party of the intent to cancel or to not extend. Relatively short lease durations for these properties are intended to provide flexibility to the Company as changing operational needs and shifting opportunities often result in cancellation or non-renewal of these leases by the Company or the lessor.

The initial lease term for certain shop and office locations is for periods ranging from one to five years with early cancellation options. The Company prefers that leases include early cancellation provisions to prevent becoming locked into long-term leases that become operationally unjustified and to allow the flexibility to pursue more cost-effective options for similar properties if they become available. These leases often include the option to extend for additional periods, which may or may not be exercised. Based on historical experience, the Company does not always extend these leases, sometimes exercises the option to cancel leases early and sometimes lessors choose to cancel leases or not extend.

The Company leases trucks to owner-operators under our lease-to-own program. We also lease dock space to a related party at our Laredo, Texas terminal.

Right-of-Use Leases

In May 2025, the Company entered into an operating lease for shop and office space for an initial term of three years that does not provide an option for early cancellation. In accordance with the provisions of ASC Topic 842, this lease resulted in the recognition of a right-of-use asset and corresponding operating lease liability of $0.9 million as of June 30, 2025. These assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date, using the Company’s incremental borrowing rate as of the respective dates of lease inception, as the rate implicit in each lease is not readily determinable. The right-of-use assets are recorded in other assets, and the lease liability is recorded in accrued expenses and other liabilities and in other long-term liabilities on our condensed consolidated balance sheet at June 30, 2025. Lease expense is recorded on a straight-line basis over the lease term and is recorded in rent and purchased transportation in our condensed consolidated statements of operations. While these lease agreements may contain provisions to extend after the initial term for an additional five years, the Company is not reasonably certain these extension options will be exercised. Therefore, potential lease payments that might occur under this extension period are not included in amounts recorded in our condensed consolidated balance sheets as of June 30, 2025.

Scheduled amounts and timing of cash flows arising from future right-of-use operating lease payments at June 30, 2025, are:

Maturity of Lease Liabilities		(in thousands)
2025 (remaining)		$	169
2026			345
2027			353
2028 and thereafter			119
Total undiscounted operating lease payments		$	986
Less: Imputed interest			(73	)
Present value of operating lease liabilities		$	913
Balance Sheet Classification
Right-of-use assets (recorded in other non-current assets)		$	913
Current lease liabilities (recorded in other current liabilities)		$	334
Long-term lease liabilities (recorded in other long-term liabilities)			579
Total operating lease liabilities		$	913
Other Information
Weighted-average remaining lease term for operating leases (years)			2.83
Weighted-average discount rate for operating leases			5.62	%

Cash Flows

A right-of-use asset of $1.0 million was recognized as a non-cash asset addition that resulted from new operating lease liabilities during the three months ended June 30, 2025. Cash paid for amounts included in the present value of operating lease liabilities was $0.05 million during the three months ended June 30, 2025 and is included in operating cash flows.

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Operating Lease Costs

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2025				2024				2025				2024
		(in thousands)
Long-term		$	48			$	29			$	48			$	114
Short-term			1,085				825				1,864				1,680
Total		$	1,133			$	854			$	1,912			$	1,794

Lease Revenue

The Company's operating lease revenue is disclosed in the table below.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2025				2024				2025				2024
		(in thousands)
Leased truck revenue (recorded in revenue, before fuel surcharge)		$	2,623			$	2,501			$	5,228			$	4,492
Leased building space revenue (recorded in non-operating income)			209				111				412				239
Total lease revenue		$	2,832			$	2,612			$	5,640			$	4,731

The Company leases trucks to owner-operators under operating leases, which generally have a term of up to five years and include options to purchase the truck at the end of the lease. In the event that an owner-operator defaults on their lease, the Company generally leases the truck to another independent contractor.

As of June 30, 2025, the gross carrying value of trucks underlying these leases was $67.5 million and accumulated depreciation was $33.9 million. Depreciation is calculated on a straight-line basis over the estimated useful life of the equipment, down to an estimated salvage value. In most cases, the Company has agreements in place with certain manufacturers whereby salvage values are guaranteed by the manufacturer. In other cases, where salvage values are not guaranteed, estimates of salvage value are based on the expected market values of equipment at the time of disposal. During the quarter ended June 30, 2025, the Company incurred $2.4 million of depreciation expense for these assets.

The Company leases dock space to a related party at our Laredo, Texas, terminal. The dock space is depreciated in conjunction with the structures and improvements for the entire Laredo terminal on a straight-line basis over the estimated useful life of the assets. Lease income is recorded as a component of non-operating income in our condensed consolidated statements of operations.

Lease Receivables

Future minimum operating lease payments receivable at June 30, 2025:

		(in thousands)
2025 (remaining)		$	5,343
2026			7,198
2027			308
2028 and thereafter			-
Total future minimum lease payments receivable		$	12,849

NOTE N: NONCASH INVESTING AND FINANCING ACTIVITIES

The Company financed approximately $15.5 million in equipment purchases during the first six months of 2025 utilizing noncash financing, compared to approximately $39.9 million during the same period of 2024.

NOTE O: SUBSEQUENT EVENTS

On July 4, 2025, the “One Big Beautiful Bill Act” was enacted into law. Among other provisions, the legislation reinstates 100% bonus depreciation for qualifying property placed in service after December 31, 2024, and modifies the limitation on business interest expense under Internal Revenue Code Section 163(j) to be based on 30% of adjusted taxable income determined using an EBITDA measure, rather than EBIT. These provisions are effective for tax years beginning after December 31, 2024, and therefore apply to the Company’s 2025 tax year.

As the legislation was enacted after the balance sheet date, its provisions did not impact the Company’s income tax provision or financial position as of June 30, 2025. The Company is currently evaluating the impact of the new law on its income tax position, cash flows, and financial statements for the remainder of 2025 and future periods.

Based on a preliminary assessment, the Company expects the reinstatement of 100% bonus depreciation and the revised business interest limitation to accelerate tax deductions in the second half of 2025. These changes are expected to reduce the Company’s estimated income tax payable recorded as of June 30, 2025 by approximately $4.5 million, resulting in the recognition of a net tax receivable and a corresponding increase in deferred tax liabilities of approximately $4.5 million.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

FORWARD-LOOKING INFORMATION

Certain information included in this Quarterly Report on Form 10-Q constitutes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may relate to expected future financial and operating results, prospects, plans or events, and are thus prospective. Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, excess capacity in the trucking industry; surplus inventories; general inflation, recessionary economic cycles and downturns in customers' business cycles; a significant reduction in or termination of the Company's trucking service by a key customer, including as a result of recent or future labor or international trade disruptions; increases or rapid fluctuations in fuel prices, interest rates, fuel taxes, tolls, and license and registration fees; potential economic, business or operational disruptions or uncertainties that may result from any future public health crises; the resale value of the Company's used equipment; the price and availability of new equipment consistent with anticipated acquisitions and replacement plans; increases in compensation for and difficulty in attracting and retaining qualified drivers and owner-operators; increases in insurance premiums and deductible amounts relating to accident, cargo, workers' compensation, health, and other claims; increases in the number or amount of claims for which the Company is self-insured; inability of the Company to continue to secure acceptable financing arrangements; seasonal factors such as harsh weather conditions that increase operating costs; competition from trucking, rail, and intermodal competitors including reductions in rates resulting from competitive bidding; the ability to identify acceptable acquisition candidates, consummate acquisitions, and integrate acquired operations; our ability to develop and implement suitable information technology systems and prevent failures in or breaches of such systems; the impact of pending or future litigation; general risks associated with doing business in Mexico, including, without limitation, exchange rate fluctuations, inflation, import duties, tariffs, quotas, political and economic instability and terrorism; the potential impact of new laws, regulations or policy, including, without limitation, rules regarding the classification of independent contractors as employees, tariffs, import/export, trade and immigration regulations or policies; and other factors, including risk factors, included from time to time in filings made by the Company with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise forward-looking statements, whether due to new information, future events or otherwise. Considering these risks and uncertainties, the forward-looking events and circumstances discussed above and in company filings might not transpire.

CRITICAL ACCOUNTING ESTIMATES

There have been no material changes to our critical accounting policies and estimates from the information provided in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Form 10-K for the fiscal year ended December 31, 2024.

BUSINESS OVERVIEW

The Company is a holding company that owns subsidiaries engaged in providing truckload dry van carrier services transporting general commodities throughout the continental United States, as well as in certain Canadian provinces. The Company’s consolidated operating subsidiaries also provide transportation services in Mexico through its gateways in Laredo and El Paso, Texas under agreements with Mexican carriers. Unless the context otherwise requires, this report presents information regarding the Company and its subsidiaries on a consolidated basis. The Company’s administrative headquarters are in Tontitown, Arkansas. From this location we manage operations conducted through our wholly owned subsidiaries based in various locations around the United States and in Mexico and Canada.

The operations of these subsidiaries can generally be classified into either truckload services or brokerage and logistics services. This designation is based primarily on the ownership of the asset that performed the freight transportation service. Truckload services are performed by Company divisions that generally utilize Company-owned trucks, long-term contractors, or single-trip contractors to transport loads of freight for customers, while brokerage and logistics services coordinate or facilitate the transport of loads of freight for customers and generally involve the utilization of single-trip contractors.

The operations of the Company and its subsidiaries are all in the motor carrier segment and are aggregated into a single reporting segment in accordance with the aggregation criteria under Generally Accepted Accounting Principles (“GAAP”). The Company has carefully considered the segment reporting requirements under Accounting Standards Codification (“ASC”) 280 and has determined that both our truckload operations and our brokerage/logistics operations have similar qualitative and quantitative economic characteristics and are impacted by virtually the same economic factors, such as rates per mile, equipment utilization and the percentage of non-compensated miles. Based on the Company’s segment identification, interpretation of the aggregation criteria outlined in ASC 280-10-50-11, and the similar qualitative and quantitative economic characteristics of the Company’s operating segments, the operations of the Company is aggregated into a single motor carrier segment. The Company’s chief operating decision maker, the Chief Executive Officer, utilizes the metrics of net income and operating ratio to evaluate company performance and in competitive analysis when comparing to competing companies.

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Truckload services revenues, excluding fuel surcharges, represented 69.4% and 66.5% of total revenues, excluding fuel surcharges, for the quarters ended June 30, 2025, and 2024, respectively. The remaining operating revenues, before fuel surcharges, for the same periods were generated from brokerage and logistics services, representing 30.6% and 33.5%, respectively.

The main factors that impact our profitability on the expense side are the costs incurred in transporting freight for our customers. Currently, our most challenging costs include capital equipment, wage and benefits costs, driver recruitment, training, independent broker costs (which we record as purchased transportation), maintenance, fuel and insurance costs.

In discussing our results of operations, we use revenue, before fuel surcharge (and fuel expense, net of fuel surcharge), because management believes that eliminating the impact of this sometimes volatile source of revenue allows a more consistent basis for comparing our results of operations from period to period. During the three months ended June 30, 2025 and 2024, approximately $17.3 million and $22.7 million, respectively, of the Company’s total revenue was generated from fuel surcharges. During the six months ended June 30, 2025 and 2024, approximately $36.0 million and $44.4 million, respectively, of the Company’s total revenue was generated from fuel surcharges. We may also discuss certain changes in our expenses as a percentage of revenue, before fuel surcharge, rather than absolute dollar changes. We do this because we believe the variable cost nature of certain expenses makes a comparison of changes in expenses as a percentage of revenue more meaningful than absolute dollar changes.

RESULTS OF OPERATIONS – TRUCKLOAD SERVICES

The following table sets forth, for truckload services, the percentage relationship of expense items to operating revenues, before fuel surcharges, for the periods indicated. Fuel costs are reported net of fuel surcharges.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2025				2024				2025				2024
		(percentages)
Operating revenues, before fuel surcharge			100.0				100.0				100.0				100.0
Operating expenses:
Salaries, wages and benefits			41.7				38.6				41.5				39.5
Operating supplies and expenses			12.3				11.5				12.9				12.0
Rent and purchased transportation			30.2				26.7				28.0				24.5
Depreciation			23.0				17.3				23.4				17.8
Insurance and claims			5.5				5.1				5.3				4.9
Other			4.6				4.6				4.6				5.2
(Gain)/loss on sale or disposal of property			(4.8	)			(0.1	)			(4.0	)			0.0
Total operating expenses			112.5				103.7				111.7				103.9
Operating loss			(12.5	)			(3.7	)			(11.7	)			(3.9	)
Non-operating income			2.4				0.1				2.5				1.8
Interest expense			(4.2	)			(2.9	)			(4.2	)			(2.7	)
Loss before income taxes			(14.3	)			(6.5	)			(13.4	)			(4.8	)

THREE MONTHS ENDED JUNE 30, 2025 VS. THREE MONTHS ENDED JUNE 30, 2024

During the second quarter of 2025, truckload services revenue, before fuel surcharges, decreased 12.9% to $92.8 million as compared to $106.6 million during the second quarter of 2024. The decrease relates primarily to an 11.9% decrease in total miles travelled from 45.8 million for the second quarter of 2024 to 40.4 million for the second quarter of 2025 and to a 2.4% decrease in our rate per mile, from $2.09 for the second quarter of 2024 to $2.04 for the second quarter of 2025. The reduction in total miles was primarily driven by a 10.7% reduction in the average number of trucks operated while the average miles driven by each truck for the second quarter of 2025 compared to the second quarter of 2024 remained relatively flat. The reduction in truck count and miles is a result of the ongoing freight recession, characterized by an oversupply of available trucks in the market compared to available freight.

Salaries, wages and benefits increased from 38.6% of revenues, before fuel surcharges, in the second quarter of 2024 to 41.7% of revenues, before fuel surcharges, during the second quarter of 2025. The percentage-based increase relates primarily to the interaction of a decrease in operating revenues with the fixed-cost nature of employing human capital.

Operating supplies and expenses increased from 11.5% of revenues, before fuel surcharges, during the second quarter of 2024 to 12.3% of revenues, before fuel surcharges, during the second quarter of 2025. The increase relates primarily to the interaction of expenses with fixed-cost characteristics, such as rents, driver training schools and operating taxes and licenses with a decrease in revenue.

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Rent and purchased transportation increased from 26.7% of revenues, before fuel surcharges, during the second quarter of 2024 to 30.2% of revenues, before fuel surcharges, during the second quarter of 2025. The increase was primarily due to a quarter-over-quarter increase in the percentage of miles driven by third-party owner-operators as opposed to company-employed drivers.

Depreciation increased from 17.3% of revenues, before fuel surcharges, during the second quarter of 2024 to 23.0% of revenues, before fuel surcharges, during the second quarter of 2025. The increase is primarily attributed to management’s change in accounting estimates related to the salvage values and useful lives of revenue equipment during the year ended December 31, 2024. During 2024, the Company conducted a review of its revenue equipment and determined that changes in market conditions and expected asset usage warranted a revision to the estimated useful lives and salvage values of certain equipment. As a result, during the year ended December 31, 2024, the Company reduced the estimated useful lives of its trailer equipment and lowered the estimated salvage values of revenue equipment to better reflect their expected residual values at the end of their service periods. This change in accounting estimates shortened the depreciable life and increased the depreciable base for a significant portion of the company’s revenue equipment, thus increasing future monthly depreciation expense for the affected assets. In addition to the effect from the Company’s previous change in accounting estimate, the year-over-year increase can also be attributed to the interaction of a decrease in operating revenues with the fixed-cost nature of depreciation expense.

Gain on disposition of equipment increased from 0.1% of revenues, before fuel surcharges, during the second quarter of 2024 to 4.8% of revenues, before fuel surcharges, during the second quarter of 2025.The increase was primarily due to the disposition of revenue equipment effected by management’s change in accounting estimates related to the salvage value and useful lives of revenue equipment during the year ended December 31, 2024. The reduced estimated salvage values had a direct impact on gains recognized when disposing revenue equipment during the six months ended June 30, 2025.

Non-operating income increased from 0.1% of revenues, before fuel surcharges, during the second quarter of 2024 to 2.4% of revenues, before fuel surcharges, during the second quarter of 2025. The increase was primarily driven by growth in the market value of our marketable equity securities as of June 30, 2025, compared to the same date in 2024.

Interest expense increased from 2.9% of revenues, before fuel surcharges, during the second quarter of 2024 to 4.2% of revenues, before fuel surcharges, during the second quarter of 2025. The increase is attributed to the Company’s increased long-term debt from $266.0 million at June 30, 2024 to $331.2 million at June 30, 2025, coupled with an increase in interest rates as the Company’s weighted average interest rate increased from 4.55% in 2024 to 5.10% in 2025.

The truckload services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 103.7% for the second quarter of 2024 to 112.5% for the second quarter of 2025.

SIX MONTHS ENDED JUNE 30, 2025 VS. SIX MONTHS ENDED JUNE 30, 2024

For the six months ended June 30, 2025, truckload services revenue, before fuel surcharges, decreased 11.3% to $185.3 million as compared to $208.8 million for the six months ended June 30, 2024. The decrease relates primarily to a 9.3% decrease in total miles travelled from 89.9 million during the first six months of 2024 to 81.6 million for the first six months of 2025 and to a 2.8% decrease in our rate per mile, from $2.10 for the first six months of 2024 to $2.04 for the first six months of 2025. The reduction in total miles was primarily driven by a 7.2% reduction in the average number of trucks operated while the average miles driven by each truck remained relatively flat when comparing the six months ending June 30, 2025 to the six months ending June 30, 2024. The reduction in truck count and miles is a result of the ongoing freight recession, characterized by an oversupply of available trucks in the market compared to available freight.

Salaries, wages and benefits increased from 39.5% of revenues, before fuel surcharges, in the first six months of 2024 to 41.5% of revenues, before fuel surcharges, during the first six months of 2025. The percentage-based increase relates primarily to the interaction of a decrease in operating revenues with the fixed-cost nature of employing human capital.

Operating supplies and expenses increased from 12.0% of revenues, before fuel surcharges, in the first six months of 2024 to 12.9% of revenues, before fuel surcharges, during the first six months of 2025. The increase relates primarily to the interaction of expenses with fixed-cost characteristics, such as rents, driver training schools and operating taxes and licenses with a decrease in revenue.

Rent and purchased transportation increased from 24.5% of revenues, before fuel surcharges, in the first six months of 2024 to 28.0% of revenues, before fuel surcharges, during the first six months of 2025. The increase was primarily due to a quarter-over-quarter increase in the percentage of miles driven by third-party owner-operators as opposed to company-employed drivers.

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Depreciation increased from 17.8% of revenues, before fuel surcharges, during the first six months of 2024 to 23.4% of revenues, before fuel surcharges, during the first six months of 2025. The increase is primarily attributed to management’s change in accounting estimates related to the salvage values and useful lives of revenue equipment during the year ended December 31, 2024. In addition to the effect from the Company’s previous change in accounting estimate, the year-over-year increase can also be attributed to the interaction of a decrease in operating revenues with the fixed-cost nature of depreciation expense.

Gain on disposition of equipment increased from 0.0% of revenues, before fuel surcharges, during the first six months of 2024 to 4.0% of revenues, before fuel surcharges, during the first six months of 2025. The increase was primarily due to the disposition of revenue equipment effected by management’s change in accounting estimates related to the salvage value and useful lives of revenue equipment during the year ended December 31, 2024. The reduced estimated salvage values had a direct impact on gains recognized when disposing revenue equipment during the six months ended June 30, 2025.

Non-operating income increased from 1.8% of revenues, before fuel surcharges, during the first six months of 2024 to 2.5% of revenues, before fuel surcharges, during the first six months of 2025. The increase was primarily driven by growth in the market value of our marketable equity securities as of June 30, 2025, compared to the same date in 2024.

Interest expense increased from 2.7% of revenues, before fuel surcharges, during the first six months of 2024 to 4.2% of revenues, before fuel surcharges, during the first six months of 2025. The increase is attributed to the Company’s increased long-term debt from $266.0 million at June 30, 2024 to $331.2 million at June 30, 2025, coupled with an increase in interest rates as the Company’s weighted average interest rate increased from 4.55% in 2024 to 5.10% in 2025.

The truckload services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 103.9% for the first six months of 2024 to 111.7% for the first six months of 2025.

RESULTS OF OPERATIONS – LOGISTICS AND BROKERAGE SERVICES

The following table sets forth, for logistics and brokerage services, the percentage relationship of expense items to operating revenues, before fuel surcharges, for the periods indicated. Brokerage service operations occur specifically in certain divisions; however, brokerage operations occur throughout the Company in similar operations having substantially similar economic characteristics.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2025				2024				2025				2024
		(percentages)
Operating revenues, before fuel surcharge			100.0				100.0				100.0				100.0
Operating expenses:
Salaries, wages and benefits			5.2				4.9				5.6				4.8
Rent and purchased transportation			89.9				86.4				89.1				86.2
Other			3.6				2.6				3.6				2.9
Total operating expenses			98.7				93.9				98.3				93.9
Operating income			1.3				6.1				1.7				6.1
Non-operating income			0.1				0.2				0.0				0.2
Interest expense			(0.3	)			(0.5	)			(0.3	)			(0.5	)
Income before income taxes			1.1				5.8				1.4				5.8

THREE MONTHS ENDED JUNE 30, 2025 VS. THREE MONTHS ENDED JUNE 30, 2024

During the second quarter of 2025, logistics and brokerage services revenue, before fuel surcharges, decreased 23.6% to $41.0 million as compared to $53.7 million during the second quarter of 2024. The decrease was primarily related to a 33.7% decrease in the number of brokered loads during the second quarter 2025 as compared to 2024.

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Rents and purchased transportation increased from 86.4% of revenues, before fuel surcharges, during the second quarter of 2024 to 89.9% of revenues, before fuel surcharges, during the second quarter of 2025. The increase results from paying third-party carriers a larger percentage of customer revenue.

The logistics and brokerage services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 93.9% for the second quarter of 2024 to 98.7% for the second quarter of 2025.

SIX MONTHS ENDED JUNE 30, 2025 VS. SIX MONTHS ENDED JUNE 30, 2024

During the first six months of 2025, logistics and brokerage services revenue, before fuel surcharges, decreased 24.2% to $85.3 million as compared to $112.4 million during the first six months of 2024. The decrease was primarily related to a 30.9% decrease in the number of brokered loads during the first six months of 2025 as compared to the first six months of 2024.

Rents and purchased transportation increased from 86.2% of revenues, before fuel surcharges, during the first six months of 2024 to 89.1% of revenues, before fuel surcharges, during the first six months of 2025. The increase results from paying third-party carriers a larger percentage of customer revenue.

The logistics and brokerage services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased from 93.9% for the first six months of 2024 to 98.3% for the first six months of 2025.

RESULTS OF OPERATIONS – COMBINED SERVICES

THREE MONTHS ENDED JUNE 30, 2025 VS. THREE MONTHS ENDED JUNE 30, 2024

Net loss for all divisions was approximately $9.6 million, or 7.2% in excess of revenues, before fuel surcharges, for the second quarter of 2025 as compared to net loss of $2.9 million, or 1.8% in excess of revenues, before fuel surcharges, for the second quarter of 2024. The decrease in net income resulted in diluted loss per share of $0.46 for the second quarter of 2025 as compared to diluted loss per share of $0.13 for the second quarter of 2024.

SIX MONTHS ENDED JUNE 30, 2025 VS. SIX MONTHS ENDED JUNE 30, 2024

For the first six months of 2025, net loss for all divisions was approximately $17.8 million, or 6.6% in excess of revenues, before fuel surcharges as compared to net loss of $2.6 million, or 0.8% of revenues, before fuel surcharges for the first six months of 2024. The decrease in net income resulted in a diluted loss per share of $0.83 for the first six months of 2025 as compared to diluted loss per share of $0.12 for the first six months of 2024.

LIQUIDITY AND CAPITAL RESOURCES

Our business has required, and will continue to require, a significant investment in new revenue equipment. Our primary sources of liquidity have been funds provided by operations, proceeds from the sales of revenue equipment, borrowings under our lines of credit, installment notes, investment margin account, and issuances of equity securities.

During the first six months of 2025, we generated $17.2 million in cash from operating activities. Investing activities generated $7.7 million in cash in the first six months of 2025. Financing activities used $24.0 million in cash in the first six months of 2025.

Our primary use of funds is for the purchase of revenue equipment. We typically use installment notes with fixed interest rates and terms ranging from 36 to 84 months, our existing line of credit on an interim basis, proceeds from the sale or trade of equipment, and cash flows from operations to finance capital expenditures and repay long-term debt. During the first six months of 2025, we utilized cash on hand and long-term debt to finance purchases of revenue equipment and other assets of approximately $18.1 million.

During the remainder of 2025, we expect to purchase approximately 188 new trucks and 650 new trailers while continuing to sell or trade older equipment, which we expect to result in net capital expenditures of approximately $25.1 million.

On April 3, 2025, we commenced a tender offer to repurchase up to 435,000 shares of our outstanding common stock at a price of not greater than $17.00 nor less than $14.00 per share. On April 11, 2025, we amended the terms of the tender offer to increase the minimum purchase price for shares purchased in the tender offer to $14.50 per share. Following the expiration of the tender offer on May 1, 2025, we accepted 870,000 shares of our common stock for purchase at $17.00 per share, at an aggregate purchase price of approximately $14.8 million, excluding fees and expenses related to the offer. The number of shares we purchased reflects our right to purchase additional shares in the tender offer up to an additional 2% of our outstanding shares. We funded the purchase of the accepted shares tendered with available cash.

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We currently intend to retain our future earnings to finance our growth and do not anticipate paying cash dividends in the foreseeable future.

During the first six months of 2025, we maintained a revolving line of credit with a borrowing limit of $60.0 million. Under this credit facility, amounts outstanding under the line bear interest at Term SOFR plus 1.85% (6.20% at June 30, 2025), are secured by our trade accounts receivable and mature on July 1, 2027. The credit facility also establishes an “unused fee” of 0.25% if average borrowings are less than $18.0 million. At June 30, 2025, we had no outstanding borrowings against the line of credit and approximately $0.2 million of outstanding letters of credit, with availability to borrow $59.8 million.

The loan agreement requires us to maintain a debt to adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization, excluding gains and losses on equity securities and extraordinary items, calculated on a rolling four-quarter basis) ratio of less than 4.00 to 1.00 as of the end of each calendar quarter. As of June 30, 2025, we were not in compliance with this financial covenant. The elevated debt to adjusted EBITDA ratio was primarily the result of increased funded debt related to the purchase of $144.2 million of revenue equipment during 2024, most of which was financed, combined with a decrease in trailing twelve-month adjusted EBITDA due to the phasing out of earlier, more favorable quarters from the rolling four-quarter calculation. The agreement provides a 45-day cure period for financial covenant violations, during which we are not deemed to be in default of the loan agreement. On August 7, 2025, within the permitted cure period, we received a written waiver from the lender for the covenant violation applicable to the period ended June 30, 2025. We remain in compliance with all other covenants under the agreement as of the date of this filing.

We are currently working with the lender to amend the financial covenant terms of the agreement on a prospective basis and anticipate having a revised covenant metric in place prior to the end of the quarter, ending September 30, 2025. However, we cannot guarantee that we will reach an agreement with the lender to revise this metric for future quarters on terms favorable to us or at all. If we are unable to reach an agreement with the lender to revise the financial covenant and do not meet the current covenant as of September 30, 2025, we would need to seek an additional waiver from the lender or obtain an alternative source of funding to supplement our cash flows. While we have not borrowed any funds under the line of credit during 2025, any failure to meet this covenant in a future quarter or obtain a waiver from the lender within the applicable cure period would accelerate our payment obligations with respect to any future amounts that we may borrow under the credit facility and prevent us from making further borrowings under the facility, either of which could materially and adversely affect our future liquidity.

Prepaid expenses and deposits decreased from $11.6 million at December 31, 2024 to $8.5 million at June 30, 2025. The decrease relates to the normal amortization of items prepaid as of December 31, 2024.

Our marketable equity securities portfolio grew $5.8 million during the first six months of 2025 from $42.6 million at December 31, 2024 to $48.4 million at June 30, 2025. The increase was driven entirely by unrealized gains due to favorable market value changes in the underlying equity holdings.

Revenue equipment decreased from $733.2 million at December 31, 2024 to $672.6 million at June 30, 2025. The decrease is primarily due to the disposition of aging trucks and trailers during the first six months of 2025, partially offset by purchases of new trucks and trailers during the first six months of 2025.

During the first six months of 2025, our current income tax position shifted from a net refundable asset of $2.3 million at December 31, 2024 to a net payable liability of $1.8 million at June 30, 2025. This change was primarily driven by the reversal of previously recognized temporary differences, most notably those related to accelerated depreciation. The transition was expected and reflects the normal timing of cash tax obligations in relation to book-tax differences. In connection with these reversals, our deferred income tax liability also decreased from $92.5 million at December 31, 2024 to $81.8 million at June 30, 2025. The reduction primarily reflects the realization of deferred tax liabilities established in prior periods for the same temporary differences, most notably those related to accelerated depreciation.

In July 2025, the federal government enacted new tax legislation that includes several provisions applicable to tax years beginning after December 31, 2024. Two provisions are particularly relevant to our business. First, the law restores 100% bonus depreciation for qualifying capital assets placed in service after 2024, reversing the previously scheduled phase-down. This change is expected to increase our near-term deductions for fleet and facility investments and may reduce our cash tax obligations in future periods. Second, the legislation reinstates the more favorable EBITDA-based limitation on the deductibility of business interest under Section 163(j), replacing the prior EBIT-based calculation. As a capital-intensive operator that finances a portion of its asset base, this change will enhance our ability to deduct interest expense and reduce future cash tax liabilities. Since the legislation was enacted after June 30, 2025, it did not affect our income tax provision or financial position as of that date. We are currently evaluating the broader implications of the new law on our liquidity, effective tax rate, and capital planning strategies for the remainder of 2025 and future periods. Based on a preliminary assessment, the Company expects the reinstatement of 100% bonus depreciation and the revised business interest limitation to accelerate tax deductions in the second half of 2025. These changes are expected to reduce the Company’s estimated income tax payable recorded as of June 30, 2025 by approximately $4.5 million, resulting in the recognition of a net tax receivable and a corresponding increase in deferred tax liabilities of approximately $4.5 million.

Accounts payable and accrued expenses remained relatively flat over the quarter, with balances of $31.0 million and $16.6 million, respectively at June 30, 2025 compared to $31.2 million and $14.6 million, respectively, at December 31, 2024.

Long-term debt and current maturities of long term-debt are reviewed on an aggregate basis, as the classification of amounts in each category are typically affected merely by the passage of time. Long-term debt and current maturities of long-term debt, on an aggregate basis, increased from $325.6 million at December 31, 2024 to $331.2 million at June 30, 2025. The increase was primarily related to the financing of additional revenue equipment during the first six months of 2025.

NEW ACCOUNTING PRONOUNCEMENTS

See Note B to the condensed consolidated financial statements for a description of the most recent accounting pronouncements and their impact, if any, on the Company.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Our primary market risk exposures include equity price risk, interest rate risk, commodity price risk (the price paid to obtain diesel fuel for our trucks), and foreign currency exchange rate risk. The potential adverse impact of these risks is discussed below. While the Company has used derivative financial instruments in the past to manage its interest rate and commodity price risks, the Company does not currently enter into such instruments for risk management purposes or for speculation or trading.

The following sensitivity analyses do not consider the effects that an adverse change may have on the overall economy, nor do they consider additional actions we may take to mitigate our exposure to such changes. The actual results of changes in prices or rates may differ materially from the hypothetical results described below.

Equity Price 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 the current market price of such securities. The recorded value of marketable equity securities increased to $48.4 million at June 30, 2025 from $42.6 million at December 31, 2024. 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 $4.8 million. For additional information with respect to the marketable equity securities, see Note D to our condensed consolidated financial statements.

Interest Rate Risk

Our line of credit bears interest at a floating rate equal to SOFR plus a fixed percentage. Accordingly, changes in SOFR, which are affected by changes in interest rates, or a change to a new index rate, will affect the interest rate on, and therefore our costs under the line of credit. Assuming $12.0 million of variable rate debt was outstanding under our line of credit for a full fiscal year, a hypothetical 100 basis point increase in SOFR would result in approximately $120,000 of additional interest expense.

Commodity Price Risk

Prices and availability of all petroleum products are subject to political, economic, and market factors that are generally outside of our control. Accordingly, the price and availability of diesel fuel, as well as other petroleum products, can be unpredictable. Because our operations are dependent upon diesel fuel, significant increases in diesel fuel costs could materially and adversely affect our results of operations and financial condition. Based upon our 2024 fuel consumption, a 10% increase in the average annual price per gallon of diesel fuel would increase our annual fuel expenses by $6.4 million.

Foreign Currency Exchange Rate Risk

We are exposed to foreign currency exchange rate risk related to the activities of our branch office located in Mexico. Currently, we do not hedge our exchange rate exposure through any currency forward contracts, currency options, or currency swaps as all of our revenues, and substantially all of our expenses and capital expenditures, are transacted in U.S. dollars. However, certain operating expenditures and capital purchases related to our Mexico branch office are incurred in or exposed to fluctuations in the exchange rate between the U.S. dollar and the Mexican peso. Based on 2024 expenditures denominated in pesos, a 10% increase in the exchange rate would increase our annual operating expenses by $0.9 million.

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Item 4. Controls and Procedures.

Evaluation of disclosure controls and procedures. Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Based on management’s evaluation, our chief executive officer and chief financial officer concluded that, as of June 30, 2025, our disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in internal controls over financial reporting. We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities, and migrating processes.

There were no changes in our internal control over financial reporting that occurred during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

We are involved in certain claims and pending litigation arising from the ordinary conduct of business. We also provide accruals for claims within our self-insured retention amounts. We currently self-insure for certain layers of auto liability claims in excess of $2.0 million. Specifically, we reserve for claims that are expected to exceed $2.0 million when fully developed, based on the facts and circumstances of those claims. Based on our knowledge of the facts, and in certain cases, opinions of outside counsel, we believe the resolution of such claims and pending litigation will not have a material effect on our financial position, results of operations or cash flows. However, if we experience claims that are not covered by our insurance or that exceed our estimated claim reserve, it could increase the volatility of our earnings and have a materially adverse effect on our financial condition, results of operations or cash flows.

Item 1A. Risk Factors.

Except as set forth below, there have been no material changes to the Company’s risk factors as previously disclosed in Item 1A to Part I of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

The imposition of tariffs on Mexico, Canada and other countries, and any retaliatory actions by such countries, may have a negative impact on our operations and profitability.

The United States has recently initiated implementation of significant new tariffs on imports from Canada, Mexico, China and other countries, and a number of these countries have announced or initiated retaliatory tariffs on exports from the United States. While certain tariffs have been suspended and/or modified on more than one occasion, the outlook remains uncertain as to what tariffs may ultimately be implemented and for how long they may be in effect. Additionally, it is uncertain the extent to which resulting retaliatory tariffs on U.S. exports may ultimately be imposed by other countries and for how long they may be in effect. There is the potential that any tariffs that have been or may be implemented could adversely affect our business operations and financial results. In particular, the imposition and enforcement of tariffs on goods imported from Mexico or Canada, or vice versa, could adversely affect our business operations and financial results because of our business in those countries. A significant portion of our business is dependent on the automotive manufacturing industry and its suppliers, which have substantial operations in Mexico and Canada. Any increases in current tariffs or the implementation of new tariffs could lead to higher costs and reduced availability and consumer demand for automotive and other products sold by our customers that are imported or exported to or from the United States. This, in turn, may result in reduced demand for our transportation services, particularly our cross-border and Mexico freight business, as customers seek to mitigate increased expenses by reducing production, sourcing components from alternative locations, or modifying their supply chain strategies. This could reduce the volume of goods transported by us, thereby affecting our operational efficiency and financial performance. In addition to the direct impact on our customers, the broader economic implications of tariffs could lead to further fluctuations in cross-border or general freight volumes and affect our operations and our ability to maintain consistent service levels. Any such disruptions could necessitate adjustments in our operational strategies, increase our costs and negatively impact our revenue and profitability.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Repurchases of Equity Securities

The Company’s stock repurchase program has been extended and expanded several times, most recently in July 2023, when the Board of Directors reauthorized 500,000 shares of common stock for repurchase under the initial September 2011 authorization. Since the reauthorization, the Company has repurchased 25,984 shares of its common stock under this repurchase program.

On April 3, 2025, the Company commenced a tender offer to repurchase up to 435,000 shares of the Company’s outstanding common stock at a price of not greater than $17.00 nor less than $14.00 per share. On April 11, 2025, the Company amended the terms of the tender offer to increase the minimum purchase price for shares purchased in the tender offer to $14.50 per share. Following the expiration of the tender offer on May 1, 2025, the Company accepted 870,000 shares of its common stock for purchase at $17.00 per share, at an aggregate purchase price of approximately $14.8 million, excluding fees and expenses related to the offer. The number of shares purchased by the Company reflects the Company’s right to purchase additional shares in the tender offer up to an additional 2% of its outstanding shares. The Company funded the purchase of the accepted shares tendered with available cash and accounted for the repurchase of these shares as treasury stock on the Company’s condensed consolidated balance sheet as of June 30, 2025.

The following table summarizes the Company’s common stock repurchases during the second quarter of 2025. No shares were purchased during the quarter other than through the 2025 tender offer, and all purchases were made by or on behalf of the Company and not by any “affiliated purchaser.”

Issuer Purchases of Equity Securities
Period		Total number of shares purchased				Average price paid per share				Total number of shares purchased as part of publicly announced plans or programs				Maximum number of shares that may yet be purchased under the plans or programs (1)
April 1-30, 2025			-				-				-				474,016
May 1-31, 2025			870,000	(2)			17.00				-				474,016
June 1-30, 2025			-				-				-				474,016
Total			870,000			$	17.00				-

(1) The Company’s stock repurchase program does not have an expiration date.

(2) Consists of shares purchased pursuant to the 2025 tender offer.

Item 5. Other Information.

Rule 10b5-1 Trading Arrangements

During the three months ended June 30, 2025, none of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

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Exhibit Number		Exhibit Description
3.1		Articles of Incorporation of PAMT CORP (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K, filed on November 12, 2024)
3.2		Bylaws of PAMT CORP (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K, filed on November 12, 2024)
10.1		Form of Amended and Restated Indemnification Agreement (incorporate by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed on May 12, 2025)
10.2		Consulting Agreement between the Company and Joseph A. Vitiritto, dated May 19, 2025 (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K, filed on May 23, 2025)
31.1		Rule 13a-14(a) Certification of Principal Executive Officer
31.2		Rule 13a-14(a) Certification of Principal Financial Officer
32.1		Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PAMT CORP
Dated: August 8, 2025	By: /s/ Lance K. Stewart
	Lance K. Stewart
	President and Chief Executive Officer
	(principal executive officer)
Dated: August 8, 2025	By: /s/ Daniel C. Kleine
	Daniel C. Kleine
	Senior Vice President of Finance and Treasurer
	(principal accounting and financial officer)

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FAQ

What were PAMT CORP (PTSI) total operating revenues for the six months ended June 30, 2025?

Total operating revenues were $306.5 million for the six months ended June 30, 2025, down from $365.5 million a year earlier.

How large was PAMT CORP's net loss and diluted loss per share for the first half of 2025?

The company reported a net loss of $17.8 million and a diluted loss per share of $0.83 for the six months ended June 30, 2025.

Did PAMT CORP face any covenant issues under its credit facility in 2025?

Yes. As of June 30, 2025 the company was not in compliance with its debt-to-adjusted-EBITDA covenant but obtained a written waiver from the lender on August 7, 2025.

How much cash and marketable securities did PAMT CORP hold at June 30, 2025?

At June 30, 2025 the company held $68.9 million in cash and $48.4 million in marketable equity securities (net unrealized gain $18.2 million).

What share repurchase activity did PAMT CORP complete in 2025?

The company accepted 870,000 shares in a tender offer at $17.00 per share for an aggregate purchase price of approximately $14.8 million.

What are PAMT CORP's expected capital expenditures for the remainder of 2025?

Management expects net capital expenditures of approximately $25.1 million for the remainder of 2025, including purchases of new trucks and trailers.