President Harry Truman fired Gen. MacArthur, DiMaggio played his final game, and Winston Churchill returned to power in the U.K. when Robert A. Young III was first introduced to a trucking company that is now a multinational operator with a global logistics reach.
That was 1951, when Young was 10 and his father, Robert A. Young Jr. bought OK Transfer – the company that would become Fort Smith-based ArcBest Corp.
On Tuesday (Feb. 2) the company announced that Young III, 75, is retiring as chairman of the Board of Directors. It ends 52 years of his being employed by the company. He served on the Board since 1970, has been board chair since 2004 and reached the board retirement age as mandated by company policy. He joined the company in 1964, served as CEO from 1988 until his retirement from that position in 2006. From 2004 to 2006, Young also served as president, CEO and board chairman.
“My pride in ArcBest and in the caring attitude that our employees demonstrate daily for customers goes back a long way,” Young said in a statement. “Seeing this company grow has given me enormous gratitude. Judy has been a strong leader in her six years as CEO, and as she takes on the role of Board Chairman, I have great confidence that our company is in the right hands for the future.”
ArcBest President and CEO Judy McReynolds has been elected to succeed Young as board chair. McReynolds, 53, has been with ArcBest 18 years. She has been president and CEO since 2010 and prior to that was the company’s chief financial officer.
McReynolds praised Young’s “deep industry knowledge.”
“Robert’s stewardship of ArcBest over so many years has been simply invaluable,” McReynolds said in the statement. “His association with ArcBest first began 65 years ago when his father, Robert A. Young Jr., purchased our first trucking company in 1951. Throughout those many years, Robert’s devotion and positive influence on our company have been evident and impactful. His deep industry knowledge and commitment to doing the right thing have led our company to expand far beyond our regional roots to become a premier provider of transportation services across the country. His guidance and friendship have meant a great deal to me personally and so many others here, and we will miss him greatly.”
ArcBest began as a small local freight hauler – OK Transfer – in 1923 operating in the Fort Smith area. The company began to grow when Fort Smith attorney Robert A. Young Jr., bought the company in 1951. More than 20 acquisitions followed the 1951 deal, with several name changes. In 1980 the company was officially known as ABF Freight System Inc.
During a September 2013 celebration of the company’s 90th anniversary, Young III said his father was a “gambler, a risk taker,” and knew the company had a future. His father “hocked his life insurance policies” and assumed other debt to bet on that future.
Young, who followed his father as president and CEO of Arkansas Best in 1973, said it was often “touch and go” in the process of buying a trucking company that was going broke before they bought it.
“After each acquisition, it was hell getting them turned around,” Young said during his anniversary comments.
One of those tough deals was on Young’s watch. In the summer of 1995 then-Arkansas Best Freight System bought in a $72.2 million deal Worldway Corp., a struggling transportation holding company whose primary business was Carolina Freight Carriers. However, the debt Arkansas Best had to acquire and the process to integrate the East Coast operations proved tough. Prior to the deal company shares were trading above $12 per share, but the equity markets saw the struggle and share prices fell to below $4.50 in late 1996. It wouldn’t be until the summer of 1999 when share prices returned to pre-Worldway levels.
Young will remain one of the largest individual shareholders (NASDAQ: ARCB) of the company. According to the company’s 2015 Proxy, Young – individually, through a Trust, and a management company – holds 1.21 million shares, or 4.6% of outstanding shares. The value of the shares, based on Tuesday’s closing price is more than $25.43 million. New York City-based BlackRock Inc. is the largest ArcBest shareholder with 2.273 million shares, or 8.75% of outstanding shares.
The company also on Tuesday announced the election of board member Steven Spinner as Lead Independent Director, a newly created position, for a one-year term. Spinner, 56, has been a director of the ArcBest board since 2011. He is president, CEO and board member of United Natural Foods (Nasdaq: UNFI). According to ArcBest, as lead independent director, Spinner’s duties will include working with McReynolds to coordinate board meeting agendas, advise McReynolds on the “information needs of the Board,” act as a liaison between McReynolds and the other independent directors, and call meetings of the independent directors.
McReynolds also serves on the board of publicly held OGE Energy Corp (NYSE: OGE), chairman of the Board of the American Transportation Research Institute, serves on the board and executive committee of the American Trucking Associations, the Transportation Industry Council of the Federal Reserve Bank of St. Louis and the Dean’s Executive Advisory Board of the Sam M. Walton College of Business at the University of Arkansas.
ArcBest is set to announce fourth quarter and full year earnings Wednesday (Feb. 3) before the markets open. The consensus estimate among the 14 analysts who cover the company is fourth quarter net income of 41 cents per share, below the 53 cents per share in the fourth quarter of 2014. The consensus estimate for full year 2015 net income is $1.96, better than the $1.82 per share in 2014.
Company shares closed Tuesday at $21.01, up 10 cents. During the past 52 weeks the share price has ranged from a $43.68 high to a $16.43 low.