Ryder System, Inc.

Good morning and welcome to the Rider System third quarter 2020 earnings release conference call. All lines are in a listen-only mode until after the presentation. Today's call is being recorded. If you have any objections, please disconnect at this time. I would now like to introduce Mr. Bob Brunn, Vice President, Investor Relations, Corporate Strategy, and Product Strategy for Rider. Mr. Brunn, you may begin.

Thanks very much. Good morning and welcome to RIDER's third quarter 2020 earnings conference call. I'd like to remind you that during this presentation, you'll hear some forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations Due to changes in economic, business, competitive, market, political, and regulatory factors. More detailed information about these factors and a reconciliation of each non-GAAP financial measure to the nearest GAAP measure is contained in this morning's earnings release, earnings call presentation, and in RIDER's filings with the Securities and Exchange Commission, which are available on RIDER's website. Presenting on today's call are Robert Sanchez, Chairman and Chief Executive Officer, and Scott Parker, Executive Vice President and Chief Financial Officer. Additionally, John Diez, President of Global Fleet Management Solutions, and Steve Sensing, President of Global Supply Chain Solutions and Dedicated Transportation are on the call today and available for questions following the presentation. With that, I'll turn it over to Robert.

Good morning, everyone, and thanks for joining us. I'd like to start the call by thanking our employees. particularly our frontline associates, our truck drivers, our maintenance technicians, warehouse workers, and all essential rider personnel who have worked tirelessly on behalf of our customers to ensure the flow of goods and services throughout the economy. On our call this morning, we'll provide an overview of our third quarter results and an update on our outlook. We'll also review the progress we're making on actions to achieve our ROE targets over time. Following our prepared remarks, we'll open the call for questions. With that, let's turn to a brief overview of our third quarter results. Operating revenue of $1.8 billion in the third quarter was in line with the prior year as higher revenues in supply chain and lease were offset by lower revenues in rental and dedicated. Comparable earnings per share from continuing operations was $1.21 in the third quarter as compared to a loss of $1.49 in the prior year. Results reflect a year-over-year earnings benefit of $108 million from a declining depreciation expense impact related to prior residual value estimate changes and higher gains on sale of used vehicles. Higher supply chain earnings and improved lease performance also contributed to increased results. Page 5 includes some additional financial information for the third quarter. Comparable EBITDA for the quarter was $640 million, up 8% from the prior year, driven primarily by improved operating performance. Excluding pension costs and other items, the comparable tax rate was an expense of 17.9% in the quarter, as compared to an expense of 7% in the prior year. Adjusted return on equity for the trailing 12-month period was a negative 4.4%. as compared to a positive 5.3% in the prior year, reflecting lower earnings from depreciation expense related to prior residual value changes and impacts related to COVID-19. I'll now turn it over to Scott to discuss the key trends that we saw in each business and review overall capital spending, cash flow, and leverage.