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OPERATING SEGMENT DATA | 3 Months Ended
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Mar. 31, 2023
OPERATING SEGMENT DATA |
OPERATING SEGMENT DATA | NOTE J – OPERATING SEGMENT DATA ​ The Company uses the “management approach” to determine its reportable operating segments, as well as to determine the basis of reporting the operating segment information. The management approach focuses on financial information that the Company’s management uses to make operating decisions. Management uses revenues, operating expense categories, operating ratios, operating income, and key operating statistics to evaluate performance and allocate resources to the Company’s operations. ​ On February 28, 2023, the Company sold FleetNet, a wholly owned subsidiary and reportable operating segment of the Company. Following the sale, FleetNet is reported as discontinued operations. As such, historical results of FleetNet have been excluded from both continuing operations and segment results for all periods presented, and reclassifications have been made to the prior-period financial statements to conform to the current-year presentation. ​ The Company’s reportable operating segments are impacted by seasonal fluctuations which affect tonnage and shipment levels and demand for services, as described below; therefore, operating results for the interim periods presented may not necessarily be indicative of the results for the fiscal year. In recent periods, including the three months ended March 31, 2023 and 2022, the Company’s operations have not been as heavily impacted by seasonal fluctuations. ​ Inclement weather conditions can adversely affect freight shipments and operating costs of the Asset-Based and Asset-Light segments. Shipments may decline during winter months because of post-holiday slowdowns; however, expedite shipments can be subject to short-term increases depending on the impact of weather or other disruptions to customers’ supply chains. Plant shutdowns during summer months may affect shipments for automotive and manufacturing customers of the Asset-Light segment, but disruptive events can result in higher demand for expedite services. Moving services of the Asset-Light segment are impacted by seasonal fluctuations, generally resulting in higher business levels in the second and third quarters as the demand for moving services is typically stronger in the summer months. ​ Historically, the second and third calendar quarters of each year usually have the highest tonnage and shipment levels, while the first quarter generally has the lowest, although other factors, including the state of the U.S. and global economies; available capacity in the market; the impact of yield initiatives; and the impact of adverse external events or conditions, may influence quarterly business levels. The Company’s yield initiatives, along with increased intelligence and visibility with respect to demand, have allowed for shipment optimization in non-peak times, reducing the Company’s susceptibility to seasonal fluctuations in recent years. ​ The Company’s reportable operating segments are as follows: ​
| ● | The Asset-Based segment includes the results of operations of ABF Freight System, Inc. and certain other subsidiaries. The segment operations include national, inter-regional, and regional transportation of general commodities through standard, expedited, and guaranteed LTL services. The Asset-Based segment provides services to the Asset-Light segment, including freight transportation related to certain consumer household goods self-move services.
​
| ● | The Asset-Light segment includes the results of operations of the Company’s service offerings in ground truckload, expedite, dedicated, intermodal, household goods moving, managed transportation, warehousing and distribution, and international freight transportation for air, ocean, and ground. The Asset-Light segment provides services to the Asset-Based segment.
​ The Company’s other business activities and operations that are not reportable segments include ArcBest Corporation (the parent holding company) and certain subsidiaries. Certain costs incurred by the parent holding company and the Company’s shared services subsidiary are allocated to the reportable segments. The Company eliminates intercompany transactions in consolidation. However, the information used by the Company’s management with respect to its reportable operating segments is before intersegment eliminations of revenues and expenses. ​ Shared services represent costs incurred to support all segments, including sales, pricing, customer service, marketing, capacity sourcing functions, human resources, financial services, information technology, and other company-wide services. Certain overhead costs are not attributable to any segment and remain unallocated in “Other and eliminations.” Included in unallocated costs are expenses related to investor relations, legal, the Company’s Board of Directors, and certain technology investments. Shared services costs attributable to the reportable operating segments are predominantly allocated based upon estimated and planned resource utilization-related metrics such as estimated shipment levels or number of personnel supported. The bases for such charges are modified and adjusted by management when necessary or appropriate to reflect fairly and equitably the actual incidence of cost incurred by the reportable operating segments. Management believes the methods used to allocate expenses are reasonable. ​ Further classifications of operations or revenues by geographic location are impracticable and, therefore, are not provided. The Company’s foreign operations are not significant. ​ The following tables reflect the Company’s reportable operating segment information from continuing operations: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended March 31 | ​
​ |  | 2023 |  | 2022 |
​ | ​ | (in thousands) | ​
REVENUES FROM CONTINUING OPERATIONS | ​ | ​ | ​ | ​ | ​ | ​ | ​
Asset-Based | ​ | $ | 697,817 | ​ | $ | 705,311 |
Asset-Light | ​ |  | 438,092 | ​ |  | 595,284 | ​
Other and eliminations | ​ |  | (29,815) | ​ |  | (32,504) | ​
Total consolidated revenues |  | $ | 1,106,094 |  | $ | 1,268,091 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
OPERATING EXPENSES FROM CONTINUING OPERATIONS | ​ | ​ | ​ | ​ | ​ | ​ | ​
Asset-Based | ​ | ​ | ​ | ​ | ​ | ​ | ​
Salaries, wages, and benefits | ​ | $ | 335,605 | ​ | $ | 313,497 |
Fuel, supplies, and expenses | ​ |  | 94,288 | ​ |  | 84,831 | ​
Operating taxes and licenses | ​ |  | 13,979 | ​ |  | 12,493 | ​
Insurance | ​ |  | 13,273 | ​ |  | 10,431 | ​
Communications and utilities | ​ |  | 5,304 | ​ |  | 4,687 | ​
Depreciation and amortization | ​ |  | 24,911 | ​ |  | 24,305 | ​
Rents and purchased transportation | ​ |  | 90,744 | ​ |  | 102,985 | ​
Shared services | ​ | ​ | 64,613 | ​ | ​ | 67,150 | ​
Gain on sale of property and equipment | ​ |  | (51) | ​ |  | (2,695) | ​
Innovative technology costs(1) | ​ |  | 6,068 | ​ |  | 6,960 | ​
Other | ​ |  | 1,612 | ​ |  | 633 | ​
Total Asset-Based | ​ |  | 650,346 | ​ |  | 625,277 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Asset-Light | ​ | ​ | ​ | ​ | ​ | ​ | ​
Purchased transportation | ​ |  | 370,163 | ​ |  | 508,380 | ​
Supplies and expenses | ​ |  | 4,072 | ​ |  | 3,266 | ​
Depreciation and amortization(2) | ​ |  | 5,068 | ​ |  | 5,180 | ​
Shared services | ​ | ​ | 51,429 | ​ | ​ | 50,197 | ​
Contingent consideration(3) | ​ | ​ | 15,040 | ​ | ​ | 810 | ​
Other | ​ | ​ | 6,411 | ​ |  | 6,335 | ​
Total Asset-Light | ​ |  | 452,183 | ​ |  | 574,168 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other and eliminations | ​ |  | (17,594) | ​ |  | (24,297) |
Total consolidated operating expenses | ​ | $ | 1,084,935 | ​ | $ | 1,175,148 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
OPERATING INCOME FROM CONTINUING OPERATIONS | ​ | ​ | ​ | ​ | ​ | ​ | ​
Asset-Based | ​ | $ | 47,471 | ​ | $ | 80,034 | ​
Asset-Light | ​ |  | (14,091) | ​ |  | 21,116 | ​
Other and eliminations | ​ |  | (12,221) | ​ |  | (8,207) | ​
Total consolidated operating income | ​ | $ | 21,159 | ​ | $ | 92,943 | ​
OTHER INCOME (COSTS) FROM CONTINUING OPERATIONS | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest and dividend income | ​ | $ | 2,933 | ​ | $ | 99 | ​
Interest and other related financing costs | ​ |  | (2,327) | ​ |  | (1,940) | ​
Other, net(4) | ​ |  | 1,780 | ​ |  | (826) | ​
Total other income (costs) | ​ |  | 2,386 | ​ |  | (2,667) | ​
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | ​ | $ | 23,545 | ​ | $ | 90,276 | ​
(1) | Represents costs associated with the freight handling pilot test program at ABF Freight.
(2) | Depreciation and amortization includes amortization of intangibles associated with acquired businesses.
(3) | Represents the increase in fair value of the contingent earnout consideration related to the MoLo acquisition (see Note B).
(4) | Includes the components of net periodic benefit cost (credit) other than service cost related to the Company’s SBP and postretirement plans and proceeds and changes in cash surrender value of life insurance policies.
​ The following table reflects information about revenues from customers and intersegment revenues: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended March 31 | ​
​ |  | 2023 |  | 2022 |
​ | ​ | (in thousands) | ​
Revenues from customers | ​ | ​ | ​ | ​ | ​ | ​ | ​
Asset-Based | ​ | $ | 669,220 | ​ | $ | 675,518 |
Asset-Light | ​ |  | 436,033 | ​ |  | 591,722 | ​
Other | ​ |  | 841 | ​ |  | 851 | ​
Total consolidated revenues |  | $ | 1,106,094 |  | $ | 1,268,091 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Intersegment revenues | ​ | ​ | ​ | ​ | ​ | ​ | ​
Asset-Based | ​ | $ | 28,597 | ​ | $ | 29,793 | ​
Asset-Light | ​ | ​ | 2,059 | ​ | ​ | 3,562 | ​
Other and eliminations | ​ | ​ | (30,656) | ​ | ​ | (33,355) | ​
Total intersegment revenues | ​ | $ | — |  | $ | — |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total segment revenues | ​ | ​ | ​ | ​ | ​ | ​ | ​
Asset-Based | ​ | $ | 697,817 | ​ | $ | 705,311 | ​
Asset-Light | ​ | ​ | 438,092 | ​ | ​ | 595,284 | ​
Other and eliminations | ​ | ​ | (29,815) | ​ | ​ | (32,504) | ​
Total consolidated revenues | ​ | $ | 1,106,094 | ​ | $ | 1,268,091 | ​
​ ​ The following table presents operating expenses by category on a consolidated basis: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended March 31 | ​
​ |  | 2023 |  | 2022 |
​ |  | (in thousands)
OPERATING EXPENSES | ​ | ​ | ​ | ​ | ​ | ​ | ​
Salaries, wages, and benefits | ​ | $ | 436,982 | ​ | $ | 414,905 | ​
Rents, purchased transportation, and other costs of services | ​ |  | 429,605 | ​ |  | 577,849 | ​
Fuel, supplies, and expenses | ​ |  | 122,618 | ​ |  | 110,359 | ​
Depreciation and amortization(1) | ​ |  | 35,010 | ​ |  | 34,396 | ​
Contingent consideration(2) | ​ | ​ | 15,040 | ​ | ​ | 810 | ​
Other | ​ |  | 45,680 | ​ |  | 36,829 | ​
​ | ​ | $ | 1,084,935 | ​ | $ | 1,175,148 | ​
(1) | Includes amortization of intangible assets.
(2) | Represents the increase in fair value of the contingent earnout consideration related to the MoLo acquisition (see Note B).
​

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
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