Covenant Transportation Group, Inc. offers truckload transportation and brokerage services to customers throughout the continental United States. The company transports full trailer loads of freight from origin to destination without intermediate stops or handling. The company’s truckload freight services utilize equipment it owns or leases or equipment owned by independent contractors for the pick-up and delivery of freight. In most of its truckload business, the company transports freight over nonroutine routes. The company provides freight brokerage services. Through its asset based and non-asset based capabilities, the company transports many types of freight for a customer base. The company provides asset-based truckload services (Truckload). The Truckload segment consists of three asset-based operating fleets that are aggregated. The three operating fleets that comprise the company’s Truckload segment are as follows: Covenant Transport, Inc. (Covenant Transport), which provides expedited long haul, dedicated, temperature-controlled, and regional solo-driver service; Southern Refrigerated Transport, Inc. (SRT), which provides primarily long haul and regional temperature-controlled service; and Star Transportation, Inc. (Star), which provides regional solo-driver and dedicated services, primarily in the southeastern United States. In addition, its Covenant Transport Solutions, Inc. (Solutions) subsidiary has various service offerings ancillary to its Truckload operations, including freight brokerage service through freight brokerage agents who are paid a commission for the freight they provide; less-than-truckload consolidation services; and accounts receivable factoring. The company owns a 49.0% interest in Transport Enterprise Leasing, LLC (TEL). TEL is a tractor and trailer equipment leasing company and used equipment reseller. Customers and Operations The company focuses on targeted markets throughout the United States. The company is a major carrier for transportation companies, such as freight forwarders, less-than-truckload carriers, and third-party logistics providers, as well as for traditional truckload customers, such as manufacturers, retailers, and food and beverage shippers. The company operates throughout the U.S. and in parts of Canada and Mexico. Revenue Equipment As of December 31, 2013, the company operated 2,688 tractors and 6,861 trailers. Of these tractors, 1,801 were owned, 655 were financed under operating leases, and 232 were provided by independent contractors, who own and drive their own tractors. Of these trailers, 2,660 were owned, 3,428 were financed under operating leases, and 773 were financed under capital leases. Regulation The company’s drivers and independent contractors must comply with the safety and fitness regulations of the U.S. Department of Transportation, including those relating to drug and alcohol testing and hours-of-service. Such matters as weight and equipment dimensions are also subject to U.S. regulations. Other agencies, such as the Environmental Protection Agency and the Department of Homeland Security also regulate the company’s equipment, operations, and drivers. Seasonality The company’s equipment utilization typically improves substantially between May and October of each year (year ended December 31, 2013) because of the trucking industry's seasonal shortage of equipment on traffic originating in California and because of general increases in shipping demand during those months. History Covenant Transportation Group, Inc. was founded in 1994. The company was incorporated in the state of Nevada in 1994.
covenant transport grp-cl a
(CVTI:Consolidated Issue Listed on NASDAQ Global Select )
400 Birmingham Highway
Chattanooga, TN 37419
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