Transportation & Logistics Q1 2021 Public Company Earnings Update

TRANSPORTATION & LOGISTICS Q1 2021 PUBLIC COMPANY EARNINGS UPDATE TRANSPORTATION & LOGISTICS INDUSTRY UPDATE | JUNE 2021

3 TABLE OF CONTENTS

Key Industry Takeaways 4 Sector Overview Third-Party Logistics 5 Trucking 6 Warehousing 8 Marine 10 Railroads 11 Airlines 12 Q1 M&A Transactions 13 Report Contributors 15 Firm Track Record 16 Endnotes 18

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KEYINDUSTRYTAKEAWAYS

Capstone Partners’ Transportation and Logistics (T&L) Group is pleased to share its Q1 2021 Public Earnings Report. Through coverage of this season’s public company earnings calls and our ongoing conversations with industry players, we have identified several key trends impacting the T&L industry.

1. Third-party logistics companies saw record sales due to the shift in consumer behavior towards e- commerce, with the pandemic playing an important role.

2. Investment in automation will be a key differentiator in logistics and warehousing, enabling firms to speed up processes at a lower cost and navigate labor shortages.

3. Demand for transportation has strengthened and contributed to higher rates across the industry.

4. Eyes continue to watch the digital brokerage market though industry veterans are skeptical of disruptive change.

5. Drivers are scarce, with rail-based intermodal companies spotting an opportunity to lure more customers to their services.

6. Canadian National (TSX:CNR) is acquiring Kansas City Southern (NYSE:KSU), a deal which should decrease trans-American shipping rates over time.

7. Air and ocean transport have seen demand climb with restrained capacity, causing rates to skyrocket.

Capstone Partners has developed a full suite of corporate finance solutions, including M&A advisory, debt advisory, financial advisory, and equity capital financing to help privately owned businesses and private equity firms through each stage of the company’s lifecycle, ranging from growth to an ultimate exit transaction.

To learn more about Capstone’s wide range of advisory services and Transportation and Logistics industry expertise, please contact Capstone Managing Director Burke Smith.

4 Transportation & Logistics | June 2021

THIRD-PARTY LOGISTICS

52-Week Range Q1 2020 Q1 2021 Revenue Q1 2021 EPS Q2 2020 Q2 2021 Estimates

EV/ Company PX Low High EBITDA Revenue EPS Actual Estimate S/M Actual Estimate S/M Revenue EPS Revenue EPS 99.00 75.58 106.75 15.13x 3,805 0.57 4,804 4,451 7.9% 1.28 0.99 29.5% 3,628 1.06 4,838 1.32 C.H. Robinson 68.54 35.16 69.90 8.78x 15,464 0.24 18,860 17,740 6.3% 0.94 0.87 7.9% 15,774 0.42 18,469 0.85 Deutsche Post 33.43 19.69 37.65 14.87x 551 (0.11) 801 729 9.8% 0.38 0.47 -19.4% 515 0.04 838 0.60 Echo Global Logistics 123.74 71.94 126.57 14.54x 1,902 0.71 3,358 2,714 23.7% 1.67 1.05 59.6% 2,581 1.09 3,347 1.53 Expeditors Intl. 293.11 127.29 319.90 8.35x 17,487 1.20 21,510 19,945 7.8% 3.30 3.24 1.9% 17,358 (1.28) 21,413 4.90 FedEx 165.58 110.29 183.80 2.82x 2,281 0.98 2,618 2,515 4.1% 1.37 1.17 17.5% 2,146 1.14 2,684 1.56 J.B. Hunt 317.10 137.55 320.10 19.01x 4,912 1.15 6,032 - - 2.64 1.92 37.5% 4,896 1.42 - 1.94 Kuehne + Nagel 79.02 36.31 93.45 9.79x 5,009 0.64 5,774 5,444 6.1% 2.26 1.82 24.1% 3,651 0.56 5,926 2.14 Penske 7.51 3.70 8.20 7.89x 177 0.00 237 183 29.6% 0.10 0.08 24.5% 276 0.09 215 0.15 Radiant Logistics 79.58 34.33 89.65 4.41x 2,161 (2.10) 2,222 2,151 3.3% 0.96 0.58 64.2% 1,895 (1.42) 2,210 1.30 Ryder 201.06 99.59 219.59 16.72x 18,035 1.11 22,908 20,685 10.7% 5.47 1.72 218.0% 20,459 2.03 23,082 2.78 UPS 25.29 14.77 27.95 5.95x 382 0.45 415 396 5.0% 0.80 0.74 8.1% 258 0.23 411 0.81 Universal Logistics 143.89 71.69 151.22 9.62x 3,864 0.20 4,774 4,346 9.8% 1.02 0.99 3.4% 3,502 (1.34) 4,800 1.62 XPO

Average 10.61x 5,849 7,255 6,254 16.0% 1.71 1.20 41.9% 5,918 0.31 6,787 1.65 0.39

Median 9.62x 3,805 4,774 2,714 75.9% 1.28 0.99 29.5% 3,502 0.42 3,347 1.53 0.57

EV = enterprise value; LTM = last twelve months; Source: Capital IQ as of June 10, 2021 $ in millions, except per share data; NM = Not Meaningful; Bold indicates trading above 90% of 52wk high

Sector Themes

• Industry players are investing in autonomous technology in order to increase speed and efficiency, creating a competitive edge. CH Robinson (Nasdaq:CHRW) is targeting a $10 million automation investment, both reducing manual processes and increasing automated bookings, in the second half of 2021 as part of its long-term cost saving measures.

• E-commerce has quickly accelerated due to a secular shift in consumer behavior, which has bolstered sales - especially for companies that can handle more volume due to automation. XPO (NYSE:XPO) has cut a five-day logistics process down to a single day with intelligent fulfillment machinery.

• Many logistics companies project greater capital expenditures to invest in their fleets and meet growing demand post-COVID. Hub Group (Nasdaq:HUBG), for example, recently added 3,000 containers.

• “The macro environment in the first quarter continued to be one of tight capacity and increased pricing in the marketplace driven by several supply side constraints, including the ongoing challenges of driver availability, coupled with robust demand.” – Robert Biesterfeld, CEO of CH Robinson Worldwide, Inc in a company press release.1

• “This outlook reflects our belief that demand remains strong and capacity constraints persist as we enter produce season.” – Peter Rogers, CFO of Echo Global Logistics, Inc in a company press release.2

5 Transportation & Logistics | June 2021

TRUCKING

Q2 2021 52-Week Range Q1 2020 Q1 2021 Revenue Q1 2021 EPS Q2 2020 Estimates EV/ Company PX Low High EBITDA Revenue EPS Actual Estimate S/M Actual Estimate S/M Revenue EPS Revenue EPS ArcBest 61.02 22.18 93.96 4.47x 701 0.07 829 812 2.1% 0.87 0.58 50.9% 627 0.61 909 1.58 Covenant 22.43 11.68 23.97 4.47x 211 (0.12) 221 206 7.3% 0.65 0.36 82.2% 192 (1.31) 226 0.67 Daseke 7.52 2.65 9.00 6.18x 391 (0.27) 334 337 -1.0% (0.13) (0.05) -161.2% 352 (0.01) 373 0.10 Forward Air 94.11 46.23 100.93 5.37x 306 0.30 362 341 6.3% 0.40 0.57 -30.4% 282 0.11 390 0.99 Heartland Express 17.86 17.48 22.75 6.89x 166 0.16 152 158 -3.6% 0.17 0.18 -3.0% 161 0.24 168 0.26 Hub Group 65.75 43.87 74.95 9.17x 839 0.40 920 929 -1.1% 0.51 0.45 12.4% 779 0.39 975 0.69 Knight-Swift 47.49 37.07 50.96 7.05x 1,125 0.38 1,223 1,232 -0.8% 0.77 0.70 10.4% 1,061 0.47 1,281 0.86 Landstar System 161.98 103.51 182.63 16.79x 929 1.04 1,288 1,171 10.0% 2.01 1.65 21.5% 824 0.63 1,495 2.31 Marten 16.99 15.13 20.13 6.55x 219 0.17 223 224 -0.5% 0.22 0.20 8.8% 212 0.22 239 0.26 Mullen 12.98 6.19 13.85 7.81x 318 0.04 291 304 -4.3% 0.13 0.11 16.4% 257 0.22 312 0.17 Old Dominion 249.77 153.57 276.09 22.38x 987 1.11 1,127 1,099 2.5% 1.70 1.58 7.6% 896 1.25 1,233 2.07 P.A.M. 56.60 27.76 66.29 5.89x 129 (0.23) 149 - - 2.08 0.00 - 93 (0.14) - 0.00 Patriot 11.13 8.10 13.16 3.07x 24 (0.12) 20 - - 0.14 0.00 - 19 0.17 - 0.00 Roadrunner 4.92 1.74 6.13 NM 0 0.00 - - - 0.00 0.00 - - 0.00 - 0.00 Saia 203.33 100.39 249.30 15.02x 446 1.06 484 478 1.2% 1.40 1.38 1.5% 418 1.07 546 1.99 Schneider 23.36 20.20 28.13 6.04x 1,119 0.25 1,229 1,192 3.1% 0.31 0.29 7.4% 1,033 0.26 1,243 0.40 TFI 111.92 43.03 116.84 14.48x 925 0.65 1,149 1,048 9.6% 0.70 0.72 -2.9% 1,106 0.79 1,411 0.99 U.S. Xpress 10.97 5.18 12.33 5.05x 433 (0.19) 451 449 0.4% 0.05 0.05 2.0% 422 0.18 464 0.23 USA Truck 16.60 6.31 21.89 4.25x 127 (0.30) 159 - - 0.40 0.16 150.0% 124 (0.11) 168 0.55 Werner 45.72 35.15 49.76 6.27x 593 0.33 616 610 1.0% 0.68 0.64 6.8% 569 0.56 649 0.85 YRC 6.50 1.46 10.20 9.9x 1,150 0.12 1,198 - - (1.26) 0.00 - 1,015 (1.09) - 0.00

Average 8.35x 530.3 0.23 592 504 2.0% 0.56 0.46 10.6% 497 0.21 575 0.71 Median 6.41x 432.6 0.16 451 341 1.1% 0.40 0.29 7.6% 418 0.22 390 0.55

EV = enterprise value; LTM = last twelve months; Source: Capital IQ as of June 10, 2021 $ in millions, except per share data; NM = Not Meaningful; Bold indicates trading above 90% of 52wk high

Sector Themes

• Strong demand and limited capacity has pushed shipping rates higher, leading to a robust pricing environment. Saia (Nasdaq:SAIA) implemented a general rate increase of 5.9%, while contracts that renewed in Q1 experienced a 9% rate increase.

• While truckload demand is unprecedented, it will be difficult to expand capacity due to bottlenecks in tractor manufacturing. Knight-Swift (NYSE:KNX) projects capex of $450-500 million, while FY 2020 capex was $522 million, according to its earnings release.3

• The driver shortage continues to pose challenges, including wage inflation, for truckload and less-than- truckload (LTL) shippers, while intermodal companies like J.B. Hunt (Nasdaq:JBHT) offer themselves as a cheaper, supply-efficient solution.

• “The runway for freight demand looks very good for 2021 and into '22. Inventory restocking will likely continue to occur for the next few quarters, and we also expect the economy to continue to strengthen as the national vaccine program expands and government stimulus dollars are spent.” – Derek J. Leathers, President, CEO, & Vice-Chairman of Werner Enterprises, Inc in a company press release.4

6 Transportation & Logistics | June 2021

TRUCKING (CONTINUED)

Technology Spotlight: The Digital Truck Brokerage Revolution

• The digital truck brokerage revolution continues to create disruption in the freight market, though industry veterans remain cautious about this newer technology.

• For XPO Logistics (NYSE:XPO), this story is about growth. In Q4 2020, the company reported record revenue in their brokerage business. Now, they have shattered another ceiling, reporting record year-over- year brokerage revenue of 83%.5 This is all thanks to their digital platform XPO Connect, a platform creating cost efficiencies seen in their Q1 gross profit, up 132%. In the last five years, this investment has given XPO the bandwidth to handle 41% more volume with a small 3% increase in sales and procurement headcount.

• Echo Global Logistics (Nasdaq:ECHO) has seen similar results. Carrier bookings from Echo’s digital platform, EchoDrive, increased 270% year-over-year in Q1 alone, the company booked over 10,000 loads from their digital channel. Echo focuses on data integration using its Application Programming Interface (API) to deliver real-time quotes, booking over $5 million in revenue from API integrations.

• Finally, J.B. Hunt continues to improve on and see results from Carrier 360, its own brokerage platform. The company’s Integrated Capacity Solutions segment delivered a year-over-year revenue increase of 56%. This is now J.B. Hunt’s second quarter of segment profitability since they turned to digital solutions. Additionally, an exciting new partnership with Google intends to reduce friction across their supply chain.

Leading Industry Participants

Source: Capital IQ and Capstone Research

7 Transportation & Logistics | June 2021

WAREHOUSING

Duke Realty 48.82 34.01 49.14 35.47x 229 0.05 293 249 17.4% 0.21 0.16 30.1% 241 0.11 258 0.23

Industrial Logistics 26.31 18.76 26.51 14.79x 64 0.20 54 56 -2.7% 0.30 0.40 -25.8% 65 0.23 54 0.31

Prologis 123.61 87.93 124.46 33.39x 1,067 0.70 1,215 994 22.3% 0.49 0.41 19.8% 1,320 0.54 1,025 0.50

Average 28.09x 461 0.26 549 474 10.8% 0.23 0.28 -30.0% 527 0.26 482 0.28

Median 31.04x 356 0.15 463 423 11.8% 0.25 0.28 -3.0% 362 0.19 425 0.27

EV = enterprise value; LTM = last twelve months; Source: Capital IQ as of June 10, 2021 $ in millions, except per share data; NM = Not Meaningful; Bold indicates trading above 90% of 52wk high

Sector Themes

• Investment in fulfillment technologies is becoming a competitive necessity as industry experts agree that legacy workflows are disadvantageous to operational efficiency.

• The booming, complex E-commerce industry requires warehouses to invest in processes that offer more flexibility and scalability due to intensity of demand. A report from ABI Research predicts that greater than 4 million robots will be present in warehouses by 2025, a large increase from 4,000 in 2018, according to ABI Research.7

• Larger industry players are ramping up merger and acquisition (M&A) activity and engaging in further consolidation of the industry, with strategic acquisitions being central to several companies’ expansions of their global networks. Americold (NYSE:COLD) has already completed two transactions totaling $118 million since the beginning of 2021.

• “Throughout the COVID-19 pandemic, consumer demand has remained steady. With the rollout of the vaccine and continued reopenings, we are seeing food manufacturer activity begin to ramp up again, which should result in more normalized inventory levels.” – Fred Boehler, CEO of Americold Realty Trust, Inc in a company press release.8

8 Transportation & Logistics | June 2021

WAREHOUSING (CONTINUED)

Company Highlight: Americold Realty Trust

Americold Realty Trust (NYSE:COLD) executed two successful transactions in Q1 totaling nearly $118 million. As the temperature-controlled company expands its global footprint, it seeks to strategically invest in companies in its vertical that will position Americold in key markets. These acquisitions will increase net operating income growth as Americold implements its unique operating model.

Select Transactions

$71 Million: Americold’s acquisition of KMT Brrr! of New Jersey increases its presence in Philadelphia and Wilmington. KMT owns two facilities, totaling 13 million cubic feet, as well as an LTL transportation segment to aid customers of these warehouses. As a result, Americold has grown by 15% in New Jersey.

$46 Million: The company also closed on Liberty Freezers, a Canada- based warehousing company. Liberty owns two facilities in Montréal and London, as well as two lease facilities in Toronto. With this deal, Americold has not only increased its exposure with multiple of its top 100 customers but increased its foothold in the major market of Toronto by 40%.

Source: CH Robinson Worldwide, Inc. Q1 2021 Earnings Presentation

9 Transportation & Logistics | June 2021

MARINE

52-Week Range Q1 2020 Q1 2021 Revenue Q1 2021 EPS Q2 2020 Q2 2021 Estimates

EV/ Company PX Low High EBITDA Revenue EPS Actual Estimate S/M Actual Estimate S/M Revenue EPS Revenue EPS Maersk 3,013 1,160 3,046 5.89x 9,571 10.00 12,439 12,350 0.7% 139.00 118.53 17.3% 8,997 21.00 13,461 165.53 Ardmore 4.25 2.61 6.11 13.36x 65 0.20 46 26 78.1% (0.26) (0.29) 11.0% 68 0.41 26 (0.27) Atlas 13.59 6.91 14.83 7.54x 308 0.15 373 383 -2.7% 0.31 0.34 -8.1% 364 0.26 383 0.31 DHT 6.37 4.52 6.62 4.57x 212 0.44 87 69 25.9% 0.07 0.02 269.8% 246 0.81 51 (0.07) Frontline 8.54 5.28 8.99 8.13x 412 0.84 194 95 - 0.15 (0.08) 282.7% 387 1.01 92 (0.10) Kirby 67.51 35.10 70.60 14.48x 644 (5.80) 497 474 4.8% (0.06) 0.13 -146.8% 541 0.42 533 0.13 Matson 62.92 27.01 79.05 5.97x 514 0.09 712 675 5.4% 1.99 1.87 6.4% 524 0.76 730 2.15

Average 8.56x 1,675 0.84 2,050 2,010 2.0% 20.17 17.22 17.2% 1,590 3.52 2,182 23.95 Median 7.54x 412 0.20 373 383 -2.7% 0.15 0.13 13.9% 387 0.76 383 0.13

EV = enterprise value; LTM = last twelve months; Source: Capital IQ as of June 10, 2021 $ in millions, except per share data; NM = Not Meaningful; Bold indicates trading above 90% of 52wk high

Sector Themes

• Sector-wide supply chain bottlenecks, coupled with increased ocean freight volumes and rates, were the main revenue drivers this quarter. Mærsk’s (CPSE:MAERSK B) total revenue grew 30%, a company record.

• The obstruction of the Suez Canal in March 2021 caused global congestion and equipment shortages that will continue to create scheduling unreliability in the near-term.

• Companies are focusing on decarbonization as part of their strategies, with investment pouring into carbon-neutral vessels and research to meet sustainability targets. Ardmore (NYSE:ASC) expects enormous changes in shipping in the next ten years as a result of initiatives by the International Maritime Organization (IMO).

• “The quarter's results were heavily impacted by the continuing effects of the COVID-19 pandemic and winter storm Uri, which brought extreme cold temperatures the Gulf close during February and virtually shut down the Gulf Coast refining and petrochemical industry for the balance of the quarter.” – David Grzebinski, President and CEO of Kirby Corporation in a press release.9

• “Automating our terminals is an integrated part of our strategy of being a world-class terminal operator, and we are happy to see that we are strongly progressing. We are automating our terminal in Los Angeles.” – Patrick Jany, Executive VP & CFO of A.P. Møller - Mærsk A/S in a press release.10

Leading Industry Participants

Source: Capital IQ and Capstone Research

10 Transportation & Logistics | June 2021

RAILROADS

52-Week Range Q1 2020 Q1 2021 Revenue Q1 2021 EPS Q2 2020 Q2 2021 Estimates EV/ Company PX Low High EBITDA Revenue EPS Actual Estimate S/M Actual Estimate S/M Revenue EPS Revenue EPS Canadian National 110.01 95.54 123.47 14.44x 3,545 1.42 3,535 3,593 -1.6% 1.37 1.23 10.9% 3,209 0.77 3,719 1.55 Canadian Pacific 80.50 54.88 82.62 16.62x 2,043 0.60 1,959 1,981 -1.1% 0.90 0.86 4.4% 1,792 0.93 2,076 1.03 CSX 97.82 65.37 104.87 15.13x 2,855 1.00 2,813 2,767 1.6% 0.93 0.95 -2.6% 2,255 0.65 2,905 1.09 KSC 296.07 140.01 315.39 21.98x 732 1.58 706 707 -0.1% 1.68 1.93 -13.1% 548 1.16 744 2.21 Norfolk Southern 273.76 166.00 295.14 16.14x 2,625 1.47 2,639 2,623 0.6% 2.66 2.54 4.8% 2,085 1.53 2,724 2.90 Union Pacific 221.50 161.41 231.26 17.05x 5,229 2.15 5,001 5,013 -0.2% 2.00 2.05 -2.6% 4,244 1.67 5,247 2.39

Average 16.89x 2,838 1.37 2,776 2,781 -0.1% 1.59 1.60 0.3% 2,355 1.12 2,902 1.86 Median 16.38x 2,740 1.44 2,726 2,695 -0.2% 1.52 1.58 0.9% 2,170 1.05 2,814 1.88

EV = enterprise value; LTM = last twelve months; Source: Capital IQ as of June 10, 2021 $ in millions, except per share data; NM = Not Meaningful; Bold indicates trading above 90% of 52wk high

Sector Themes

• The industry is seeing increased investment in precision scheduled railroading and fuel saving technology as top players in rail attempt to streamline operations and elevate operational efficiency.

• Canadian National Railway’s (TSX:CNR) acquisition of Kansas City Southern (NYSE:KSU) reflects further consolidation of Class 1 rail. Fewer competitors in the industry mean that the new entity has more pricing leverage.

• Strong demand persists with several key industry players reporting record revenue ton miles (RTMs) and carloads. According to the Association of American Railroads, total carloads in the U.S. are up by 20% year- to-date versus 2020.11

• “Our service product made more resilient through PSR, and lower cost structures, enabling us to win new business and expand opportunities that will ultimately grow the top line.” – Lance Fritz, President and CEO of Union Pacific Corporation in a press release.12

• “Part of PSR, and as I've learned it through the last few years, it is about getting your plan rightsized for the time and then continuing to tweak it, continuing to find efficiencies in places that maybe you don't expect. I think we'll be able to see continued improvement in locomotive utilization, fuel, headcount, all of those areas beyond 2021.” – Cynthia Sanborn, Executive VP & COO of Norfolk Southern Corporation in a press release.13

Leading Industry Participants

Source: Capital IQ and Capstone Research

11 Transportation & Logistics | June 2021

AIRLINES

52-Week Range Q1 2020 Q1 2021 Revenue Q1 2021 EPS Q2 2020 Q2 2021 Estimates EV/ Su. Su. Company PX Low High EBITDA Revenue EPS Actual Estimate (Miss) Actual Estimate (Miss) Revenue EPS Revenue EPS Alaska Air 65.62 33.00 74.25 NM 1,636 (1.89) 797 789 1.0% (1.05) (3.64) 71.1% 421 (1.74) 1,509 (0.79) Allegiant 214.54 99.27 271.29 NM 409 (2.08) 279 292 -4.2% 0.42 (3.01) 113.9% 133 (5.85) 442 2.17 American 23.85 10.63 26.09 NM 8,515 (5.26) 4,008 4,039 -0.8% (1.97) (4.33) 54.5% 1,622 (4.82) 7,132 (2.42) Delta 46.52 24.38 52.28 NM 8,592 (0.84) 4,150 3,907 6.2% (1.85) (3.17) 41.7% 1,468 (9.01) 6,218 (1.42) JetBlue 18.83 9.72 21.96 NM 1,588 (0.97) 733 691 6.1% (0.78) (1.66) 52.8% 215 (1.18) 1,430 (0.75) SkyWest 48.69 25.00 61.16 29.54x 730 0.59 535 576 -7.1% 0.71 0.67 6.5% 350 (0.51) 606 0.28 Southwest 58.42 30.24 64.75 NM 4,234 (0.18) 2,052 2,069 -0.8% 0.19 (1.85) 110.3% 1,008 (1.63) 3,846 (0.39) Spirit 34.80 14.65 40.77 NM 771 (0.41) 461 459 0.5% (1.15) (2.66) 56.7% 139 (1.81) 798 (0.99) United 57.23 29.23 63.70 NM 7,979 (6.86) 3,221 3,242 -0.7% (4.29) (7.12) 39.8% 1,475 (5.80) 5,169 (4.40)

Average 29.54x 3,828 (1.99) 1,804 1,785 0.0% (1.09) (2.97) 60.8% 759 (3.59) 3,017 (0.97) Median 29.54x 1,636 (0.97) 797 789 -0.7% (1.05) (3.01) 54.5% 421 (1.81) 1,509 (0.79)

EV = enterprise value; LTM = last twelve months; Source: Capital IQ as of June 10, 2021 $ in millions, except per share data; NM = Not Meaningful; Bold indicates trading above 90% of 52wk high

Sector Themes

• Airlines are recovering quickly, with strong demand momentum in Q1 expected to surge forward into Q2 as airlines match forward capacity with booking trends.

• Many companies are returning to positive cash flow as countries with advanced vaccine rollouts open their borders. United Airlines (Nasdaq:UAL) reported positive cash flow this quarter and expects to remain positive, signaling that the worst of the pandemic is behind the industry.

• De-levering is at, or near the top, of every airline’s agenda, with strong focus being placed on simultaneously paying down financial obligations and continuing to reduce daily cash burn. During Q1, American Airlines repaid its entire $2.8 billion of revolvers.

• “Consumer confidence in air travel continues to increase with the pace of vaccinations in the U.S. rapidly accelerating and predictions of herd immunity as soon as this summer.” – Ed Bastian, CEO of Delta Air Lines 14

• “A few weeks ago, there was a rumor that Greece was going to open. As soon as that rumor occurred, our Greece bookings took off. Athens is our second best booked Atlantic market this summer.” – Andrew Nocella, Executive VP & CCO of United Airlines Holdings, Inc. in a press release.15

Leading Industry Participants

Source: Capital IQ and Capstone Research

12 Transportation & Logistics | June 2021

Q1 2021 M&A Transactions

Enterprise EV / LTM Date Target Acquirer Target Business Description Value (mm) Revenue EBITDA

Vision Marine Provides rental electric boat and private boat 06/08/21 EB Rental --- (NAS:VMAR) club services.

Provides logistics operations and develops software for 06/08/21 Blackbird Logistics HERBL --- cannabis distribution process.

Phoenix EI Offers reliable non-emergency medical 06/06/21 GC Logistics --- Transportation transportation services.

Bright Spark Provides logistics, moving, and storage services to the 06/03/21 Sterling --- Strategies business and residential communities.

Network Wireless Operates as a full-service materials and logistics 06/02/21 Grain Management --- Solutions provider for the wireless industry.

American Trailer 06/02/21 Wind Point Advisors Offers trailer rental services. - - - Rental

06/02/21 HPN Select Buyers Access Offers group procurement services. - - -

The Kenan 06/02/21 Ag Trucking Provides transportation services. - - - Advantage Group

Knight-Swift 06/01/21 Utxl Enterprises Operates as a subsidiary of Knight-Swift. - (NYSE:KNX) $22.5 0.2x

Offers on-demand jet charters and helicopter 05/31/21 Online Jet Charters Jettly --- charters services.

Hilco Commercial 05/25/21 Sutton Leasing Offers fleet management and leasing services. - - - Industrial

HomeCorp Corporate Housing Engages in commercial and residential 05/20/21 --- Relocation Associates relocation services.

Renaissance Villa Grand Caribbean 05/20/21 Operates marinas in the Caribbean and Puerto Rico. - - - Marina Marinas

Geaux Geaux Bogalusa Bayou 05/20/21 Operates railroad lines such as ZEE railroad. - - - Railroad Railroad

Crystal Creek Provides multichannel frozen and dry order fulfillment 05/20/21 Lineage Logistics --- Logistics and shipping services for e-commerce companies.

05/13/21 Happy Returns PayPal (NAS:PYPL) Provides in-person returns for online shoppers. - - -

Provides air charter, on demand charter, aircraft 05/06/21 USAC Airways National Airways --- management, VIP jets, and aircraft sales.

Americold Provides temperature-controlled logistics services 05/05/21 KMT Logistics -- (NYSE:COLD) through road transport. $71.1

05/05/21 PCS Gophers Grand Rapids Provides logistics services. - - -

Provides pallet distribution and management, container 05/04/21 Relogistics Services 48forty Solutions --- tracking and management, and consulting services.

MarineMax 05/03/21 KCS International Offers yacht and boat building and repair services. - (NYSE:HZO) $63.0 0.8x

Source: Capital IQ, PitchBook, FactSet, and Capstone Research

13 Transportation & Logistics | June 2021

Q1 2021 M&A Transactions

Enterprise EV / LTM Date Target Acquirer Target Business Description Value (mm) Revenue EBITDA

Offers truckload transportation and e-commerce 05/03/21 Boss Logistics Ruby Has --- fulfillment services.

Provide fixed-base operator and maintenance, repair, 05/03/21 Silverhawk Aviation Ross Aviation --- and overhaul services.

Provides liquid and dry bulk food grade 04/30/21 Jasa Transit Carry Transit --- transportation services.

Engages in freight consolidation, Internet based supply 04/30/21 Century Distribution Sun Capital --- chain management, and warehousing.

Business Intelligence Provides traditional domestic/international freight 04/27/21 SecurCapital --- Group forwarding, customs house brokerage, and 3PL.

Net Savings Link Owns and operates an online blockchain based 04/22/21 Rydehails --- (OTCPK:NSAV) rideshare platform.

04/21/21 Kent Moving Rose Moving Provides moving and storage services. - - -

Engages in the construction, maintenance, repair, and 04/19/21 ITR Concession Caisse de dépôt --- operation of the Indiana Toll Road.

04/19/21 RLB Contracting Encore Dredging Provides dredging services. - - -

04/15/21 Sunshine Services Sobel Network Provides cargo services for airlines. - - -

Offers dry bulk, liquid bulk, dry van transportation, 04/13/21 Luckey Trucking A&R Logistics --- warehousing, and logistics services.

Holiday Island 04/16/21 UStorage USA Offers self-service self-storage solutions. -- (OTCPK:HIHI) $1.48

04/12/21 BC Freightways Magnum LTL Provides trucking terminals in the United States. - - -

Provides home delivery and distribution services 04/06/21 DSI Logistics Pilot Freight --- for retailers.

Operates as a custom brokerage and freight 04/06/21 DJS International Bdp International --- forwarding firm.

Comprises a franchised logistics unit that provides 04/01/21 Kansas City Pilot Freight --- transportation and logistics services.

Daryl Flood Offers moving, relocation, and logistics services in 04/01/21 Suddath --- Relocation Dallas, Fort Worth, Houston, and Austin, Texas.

03/24/21 Star Leasing I Squared Capital Offers trailer leasing services in the USA. - - -

Offers an integrated biometric facial recognition system 03/19/21 veriScan PRE --- for airports and airlines.

The Jordan Provides transportation and logistics solutions around 03/17/21 AIT Worldwide - Company the world. $1,200.0 1.0x

Provides customs brokerage and freight 03/16/21 Alba Wheels Up Southfield Capital --- forwarding services.

Source: Capital IQ, PitchBook, FactSet, and Capstone Research

14 Transportation & Logistics | June 2021

TRANSPORTATION & LOGISTICS REPORT CONTRIBUTORS

Burke Smith Managing Director [email protected] | 310-872-0038

Burke brings to Capstone Partners over 20 years of experience as an advisor to or leader of middle market companies, including several asset-based trucking and warehousing operations. Over his career as an M&A advisor, Burke has executed more than 45 transactions with a combined value in excess of $40 billion.

Burke began his career working on Wall Street. He initially trained at Wasserstein Perella & Co., where he worked directly for famed M&A banker Bruce Wasserstein. Burke then joined Donaldson, Lufkin & Jenrette (DLJ) as an early member of the firm’s Exclusive Sales Group, which became one of the most successful middle market sell-side advisory practices on Wall Street. Following the acquisition of DLJ by Credit Suisse, Burke joined UBS as an Executive Director in the mergers and acquisitions group.

Jay Mercier Vice President [email protected] | 404-934-6362

Jay serves as a Vice President in Capstone’s Transportation and Logistics Group. He brings over 10+ years of capital markets experience spanning Investment Banking, Credit Trading and Equity Derivatives Trading. Prior to joining Capstone Partners, Jay worked as a Director at Cowen where he was a member of the Outsourced Trading Team. He was responsible for the account coverage of institutional buy-side accounts and advised clients on risk mitigation strategies with the use of exchange-traded derivatives.

Nathan Feldman Associate [email protected] | 845-416-5906

Nathan currently serves on Capstone Partners’ Transportation and Logistics team helping business owners in the industry execute sell-side M&A transactions. Previously, he was part of Capstone Partners’ Research and Business Development Teams, writing about and communicating M&A trends to business owners in various industries. Prior to joining Capstone, Nathan worked at a Boston-based startup incubator that focused on building companies that connected the U.S. and Chinese market. Nathan earned his BA from Brandeis University with a degree in English, Business and Physics.

Special contribution by Capstone’s Summer Analyst John Lindsey

15 Transportation & Logistics | June 2021

FIRM TRACK RECORD

Capstone has represented numerous companies in transportation and logistics that serve the needs of the global economy. Sample recent engagements include the following:

HAS BEEN ACQUIRED BY HAS BEEN ACQUIRED BY HAS BEEN ACQUIRED BY

HAS SECURED DEBT IN HAS BEEN ACQUIRED BY HAS BEEN ACQUIRED BY CONNECTION WITH THE ACQUISTION BY

“ The team at Capstone did an incredible job combining these two successful family-owned companies. Current and new customers now have a real cost-saving alternative with our nationwide volume LTL network.

” Mike Wallace, Co-Founder of Am Trans

16 Transportation & Logistics | June 2021

ENDNOTES

1. Seeking Alpha, “CH Robinson Worldwide, Inc. Robert Biesterfeld on Q1 2021 Results,” https://seekingalpha.com/article/4421821-ch-robinson-worldwide-inc-chrw-ceo-robert-biesterfeld-on-q1-2021-results- earnings-call, accessed May 25, 2021. 2. Seeking Alpha, “Echo Global Logistics. CEO Doug Waggoner on Q1 2021 Results,” https://seekingalpha.com/article/4422311- echo-global-logistics-echo-ceo-doug-waggoner-on-q1-2021-results-earnings-call-transcript, accessed May 25, 2021. 3. Knight-Swift Transportation, “Knight-Swift Transportation 2020 Annual Report,” https://d18rn0p25nwr6d.cloudfront.net/CIK-0001492691/8771c1a1-29f7-4c2a-ac82-00f4b0b6cbe6.pdf, accessed June 9, 2021. 4. Werner Enterprises, Inc., “Werner Enterprises 2020 Annual Report,” https://d18rn0p25nwr6d.cloudfront.net/CIK- 0000793074/6310fdd4-2cd0-4cc3-8dc2-0a8bd42d5c19.pdf, accessed June 9, 2021. 5. Seeking Alpha, “XPO Logistics, Inc. CEO Brad Jacobs on Q1 2021 Results,” https://seekingalpha.com/article/4424305-xpo- logistics-inc-xpo-ceo-brad-jacobs-on-q1-2021-results-earnings-call-transcript, accessed May 25, 2021. 6. Seeking Alpha, “Knight Swift Transportation Holdings, Inc. 2021 Q1 Earnings Presentation,” https://seekingalpha.com/article/4420265-knight-swift-transportation-holdings-inc-2021-q1-results-earnings-call- presentation, accessed May 25, 2021. 7. ABI Research, “50,000 Warehouses to Use Robots by 2025,” https://www.abiresearch.com/press/50000-warehouses- use-robots-2025-barriers-entry-fall-and-ai-innovation-accelerates, accessed June 9, 2021. 8. Seeking Alpha, “Americold Realty Trust CEO Fred Boehler on Q1 2021 Results,” https://seekingalpha.com/article/4426610- americold-realty-trust-cold-ceo-fred-boehler-on-q1-2021-results-earnings-call-transcript, accessed May 25, 2021. 9. Seeking Alpha, “Kirby Corporation CEO David Grzebinski on Q1 2021 Results,” https://seekingalpha.com/article/4423214- kirby-corporation-kex-ceo-david-grzebinski-on-q1-2021-results-earnings-call-transcript, accessed May 25, 2021. 10. Maersk, “Maersk Delivers Strong Transformation Progress and Results in 2020,” https://www.maersk.com/news/articles/2021/02/10/ap-moller-maersk-delivers-strong-transformation-progress-and- results-2020, accessed June 9, 2021. 11. Raymond James, “Executive Freight Trends Insight,” https://www.raymondjames.com/- /media/rj/dotcom/files/corporations-and-institutions/investment-banking/industry- insight/executive_freight_trends_digest.pdf,” accessed June 9, 2021. 12. Seeking Alpha, “Union Pacific Corporation CEO Lance Fritz on Q1 2021 Results,” https://seekingalpha.com/article/4420730-union-pacific-corporation-unp-ceo-lance-fritz-on-q1-2021-results- earnings-call-transcript, accessed May 25, 2021. 13. Seeking Alpha, “Norfolk Southern Corporation 2020 Annual Report,” https://seekingalpha.com/filing/5343951, accessed June 9, 2021. 14. Seeking Alpha, “Delta Air Lines Inc. CEO Ed Bastian on Q1 2021 Results,” https://seekingalpha.com/article/4419326-delta- air-lines-inc-dal-ceo-ed-bastian-on-q1-2021-results-earnings-call-transcript, accessed May 25, 2021. 15. Seeking Alpha, “United Airlines Holdings, Inc. 2020 Annual Report,” https://seekingalpha.com/filing/5401961, accessed June 9, 2021.

Common Goals. Uncommon Results.

Disclosure This report is a periodic compilation of certain economic and corporate information, as well as completed and announced merger and acquisition activity. Information contained in this report should not be construed as a recommendation to sell or buy any security. Any reference to or omission of any reference to any company in this report should not be construed as a recommendation to buy, sell or take any other action with respect to any security of any such company. We are not soliciting any action with respect to any security or company based on this report. The report is published solely for the general information of clients and friends of Capstone Partners. It does not take into account the particular investment objectives, financial situation or needs of individual recipients. Certain transactions, including those involving early-stage companies, give rise to substantial risk and are not suitable for all investors. This report is based upon information that we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied upon as such. Prediction of future events is inherently subject to both known and unknown risks and other factors that may cause actual results to vary materially. We are under no obligation to update the information contained in this report. Opinions expressed are our present opinions only and are subject to change without notice. Additional information is available upon request. The companies mentioned in this report may be clients of Capstone Partners. The decisions to include any company in this report is unrelated in all respects to any service that Capstone Partners may provide to such company. This report may not be copied or reproduced in any form or redistributed without the prior written consent of Capstone Partners. The information contained herein should not be construed as legal advice.

17 Market Presence With a long-established U.S. footprint, together with an international partner platform, we provide clients with broad expertise and access to key market relationships on a global basis. Our presence is backed by ~200 professionals in the U.S. with 450+ professionals across 43 countries.

218 $12.5B 30% 6th M&A transactions aggregate of our deals globally ranked for completed in 2020 transaction value are cross- deals under $500m border $65.1M 51 65% average deals involving foreign completed with a transaction private equity firms European partner value

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