One of Jacksonville’s newest companies became its newest public company with a May 8 initial public offering and instantly became one of the largest companies in its field.
Proficient Auto Logistics Inc., which ships automobiles from manufacturers to dealers, sold 14.333 million shares of stock at $15 each in its IPO and followed that up May 13 by acquiring five auto transport companies. Its stock trades under the ticker symbol “PAL.”
While the company was officially formed in June 2023, according to its IPO registration statements with the Securities and Exchange Commission, it had no operating business until acquiring those five companies.
With the combination of those businesses, Proficient has a fleet of about 1,130 auto transport vehicles, ranking it third in the U.S., according to the SEC filings.
Only Plymouth, Michigan-based United Road Services, with 1,978 vehicles, and Kansas City, Missouri-based Jack Cooper Investments, with 1,286, are bigger, the filings said.
Both of those companies are privately owned.
The five Proficient companies combined produced about $415 million in revenue last year.
The largest of the five is Jacksonville-based Proficient Auto Transport Inc., which has about 140 employees and had $136 million in revenue last year.
Proficient Auto Transport CEO Randy Beggs is president and chief operating officer of parent company Proficient Auto Logistics, part of an experienced management team touted by the company in its filings.
Richard O’Dell, chief executive of the parent company, was previously CEO of publicly traded trucking company Saia Inc.
“Mr. O’Dell and Mr. Beggs will be supported by a highly talented group of tenured auto transportation and logistics veterans, who have an average of over 25 years of experience operating within the auto transportation and logistics subsector and broader trucking industry. We believe our leadership team is well positioned to execute our strategy and remains a key driver of our financial and operational success,” the IPO filings said.
Proficient also said it has an experienced board of directors that includes James Gattoni, recently retired CEO of Jacksonville-based trucking company Landstar System Inc.
Proficient intends to operate its acquired companies under their existing names and management teams.
“We anticipate that members of management of the Founding Companies and companies to be acquired in the future will continue to maintain local control of their daily operations and work in coordination with each other, rather than compete, for business opportunities in their local markets,” its filings said.
“We believe this approach will enable us to take advantage of the local and regional market knowledge, name recognition, and customer relationships possessed by each acquired company while still allowing us to bring greater operating efficiency to the larger platform.”
Besides Proficient Auto Transport, the other four firms acquired May 13 are two New Jersey-based companies, Delta Automotive Services Inc. and Tribeca Automotive Inc., and two California-based companies, Deluxe Auto Carriers Inc. and Sierra Mountain Group Inc.
Proficient is hoping an upswing in automobile manufacturing as the industry rebounds from the coronavirus pandemic will spur growth in its business.
However, the overall environment for trucking companies has been difficult in the last two years. Analysts say the capacity of the industry exceeds the demand for freight services, and that has put some trucking companies out of business.
“We have recently seen an uptick in headlines on trucking company bankruptcies, mostly amongst smaller carriers,” Morgan Stanley analyst Ravi Shanker said in a May 6 report.
Shanker cited a 92-year-old Texas-based company called Arnold Transportation Services that shut down at the end of April as its parent company filed for bankruptcy.
He also cited Jacksonville-based Raven Transport Holding Inc., a subsidiary of the Florida East Coast Railway, which filed a Worker Adjustment and Retraining Notification Act notice April 30 saying it was shutting down and permanently laying off 83 employees.
Shanker said Raven “has not provided a reason for its closure.”
Proficient said it expects to report first-quarter revenue from the combined companies of $89.5 million to $91.9 million, down from $98.7 million in the first quarter of 2023.
“This decline reflects a reduction in units delivered during the most recent quarter as the effect of United Auto Workers strikes in Fall 2023 manifested in a gap in produced vehicles available for delivery early in 2024,” its filing said.
However, the company is optimistic about its growth prospects.
“Industry production volumes are beginning to rebound, and are expected to be a continuing tailwind for the auto transportation and logistics industry throughout the next three to five years,” it said.
“We believe the combination of our executive management team, the management of the Founding Companies, and the fragmented nature of the auto transportation and logistics market will provide us with the capability and opportunity to continue to expand both organically and via effective tuck-in acquisitions.”