SEGMENT REPORTING

9 Months Ended

Sep. 30, 2020

SEGMENT REPORTING

SEGMENT REPORTING

NOTE 3 – SEGMENT REPORTING

The Company’s two reportable segments are Trucking and USAT Logistics.  In determining its reportable segments, the Company’s chief operating decision maker focuses on financial information, such as operating revenue, operating expense categories, operating ratios and operating income, as well as on key operating statistics, to make operating decisions.

Trucking. Trucking is comprised of one-way truckload and dedicated freight motor carrier services.  Truckload provides motor carrier services as a medium-haul common and contract carrier.  USA Truck has provided truckload motor carrier services since its inception, and continues to derive the largest portion of its gross revenue from these services.  Dedicated freight provides truckload motor carrier services to specific customers for movement of freight over particular routes at specified times.

USAT Logistics. USAT Logistics’ service offerings consist of freight brokerage, logistics, and rail intermodal services.  Each of these service offerings match customer shipments with available equipment of authorized third-party motor carriers and other service providers.  The Company provides these services to many existing Trucking customers, many of whom prefer to rely on a single service provider, or a small group of service providers, to provide all their transportation solutions.

Revenue equipment assets are not allocated to the USAT Logistics segment as freight services for customers are brokered through arrangements with third-party motor carriers who utilize their own equipment.  To the extent rail intermodal or other USAT Logistics operations require the use of Company-owned assets, they are obtained from the Company’s Trucking segment on an as-needed basis.  Depreciation and amortization expense is allocated to the USAT Logistics segment based on the Company-owned assets specifically utilized to generate USAT Logistics revenue.  All intercompany transactions between segments reflect rates similar to those that would be negotiated with independent third parties.  All other expenses for the USAT Logistics segment are specifically identifiable direct costs or are allocated to the USAT Logistics segment based on relevant cost drivers, as determined by management.

A summary of operating revenue by segment is as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Operating revenue	(in thousands)
Trucking revenue (1)	$	97,383	$	93,587	$	280,005	$	284,965
Trucking intersegment eliminations		(651)		(233)		(2,353)		(1,002)
Trucking operating revenue		96,732		93,354		277,652		283,963
USAT Logistics revenue		52,059		39,365		126,623		120,390
USAT Logistics intersegment eliminations		(7,005)		(1,795)		(11,979)		(5,833)
USAT Logistics operating revenue		45,054		37,570		114,644		114,557
Total operating revenue	$	141,786	$	130,924	$	392,296	$	398,520

1) Includes foreign revenue of $8.8 million and $9.5 million for the three months ended September 30, 2020 and 2019, respectively, and $24.9 million and $28.5 million for the nine months ended September 30, 2020 and 2019, respectively.

A summary of operating income (loss) by segment is as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Operating income (loss)	(in thousands)
Trucking	$	3,453	$	(278)	$	2,941	$	2,168
USAT Logistics		981		244		181		3,702
Total operating income (loss)	$	4,434	$	(34)	$	3,122	$	5,870

A summary of depreciation and amortization by segment is as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Depreciation and amortization	(in thousands)
Trucking	$	9,615	$	9,435	$	29,088	$	26,867
USAT Logistics		281		217		853		728
Total depreciation and amortization	$	9,896	$	9,652	$	29,941	$	27,595