Post Gordon ~ Thoughts, Commentary & Reflections

When I started driving, the 'average' trucker was a 50-year-old sob with no regard for new drivers. Unfriendly. Might as well have been 900-years-old.

A-N-C-I-E-N-T.

Average trucker today still about 50-years-old, I think. Had been told 'average' at Gordon Orientation was 48. Gordon had/has young mechanics. Of course, they're paid hourly, go home at night and don't have to sleep in the shop.

At 35-ish, CougFan's a youngster! Born 1978, CougFan??

 

Update on Scott Gordon's Money

It's been a good week for Scott Gordon so far.

HTLD shares have gone up, hit $18.03 yesterday, Nov. 26, 2013.

Scott's HTLD now worth $1,528,571.

When acquired two weeks ago on Nov. 11, 2013 at $14.37, Scott's HTLD we're worth $1,218,518.

So Scott's up $310,353 in the 15 days since the acquisition.

The 'predicted' trading range for HTLD, $17-$19.

Scott can't cash in until 2017.

Been a pretty good two weeks on paper, though.

 

Great comment (msg #97) by PSUMoose here: http://www.thetruckersreport.com/tr.../229492-looking-to-hire-on-with-gordon-3.html

Comment probably deserves entire thread. Talks about choice between hometime or miles. Drivers who 'blow up his phone' about low miles while at the same time he can't rely on them. Has advice on how to communicate effectively with DM/FM over miles...

 

Vic's Commentary

'Counting Scott, Larry and Steve's Money'

​

Larry Gordon

If Scott's 84,796 is such a nice, round number, Larry Gordon's (the elder Gordon, family patriarch) 498,465 HTLD shares acquired at $14.37 per share starts to sound more like real money. So what were Larry's HTLD shares worth at acquisition??

Do the math: $7,162,942.

Still small potatoes in the Gordon world. The Gordon family received $110 million in cash and $40 million in stock. Where does this info on Larry Gordon's HTLD shares come from? See: http://biz.yahoo.com/t/17/9202.html Furthermore, there's been a sharp run up in the value of HTLD from $14.37 on Nov. 11, 2013 to $18.02 yesterday. What are Larry's 498,465 shares worth at yesterday's close, 15 days after acquisition??

Do the math: $8,982,339.

Not only that, as this is written HTLD's up another 25 cents/share. The Gordon's have never made money so fast--except they can't cash it in until 2017. Larry's gain (on paper--not counting the 25 cent rise so far today) in the last two weeks??

Two week gain: $1,819,397. About $900K per week.

Doesn't take much to imagine a Gordon family gathering where they ask themselves why they didn't do this (go public) themselves--and a long time ago, instead of risking all their financial eggs in the GTI basket without much outside help. Of course, with $110 million in cash from the deal, HTLD stock is not all that big a part of the Gordon family wealth.

Still, even on paper a $900K per week gain for the first 2 weeks has a nice ring to it, doesn't it? The problem is it doesn't seem to add up to the $40 million stated in the public announcement about the sale. More on this later.

Scott and Steve get to continue their jobs presumably up in Pacific as part of the deal. That's a good thing. At least for a while. What else does Larry get? Quite a bit, actually. First off, he became a member of the HTLD board. Larry (family patriarch) also has a number of side deals through Valley Freightliner, leases on trucks and leases on the truck terminals.

While HTLD acquired all of GTI stock, it surprised me some to read that Larry Gordon owned only 50%. So of the $110 million pay out in cash, likely $55 million went directly to Larry Gordon. This information is available here: http://biz.yahoo.com/e/131115/htld8-k.html

Larry Gordon (and his wife) own 59% of Valley Freightliner and HTLD entered into a Services Agreement to the tune of up to $60,000 per month, which will start to drop each quarter until the $$ flow to Valley ends in 2014.

But wait!! That's not all.

In addition to warranty work (separate apparently from the $60K per month above), Larry Gordon and wife have a 19% interest in tractors that were leased to Gordon and Larry and wife receive $153,653 per year, over $10K per month of the yearly $808,700 lease payment.

A second similar lease has a $7,448,000 yearly payment, of which Larry and wife own 59%. Their share per year: $4,397,299.

Some of us would consider income off either of those leases a big enough pay increase to take the rest of the year off, just let the $$ to roll in.

But wait!! There's more.

HTLD entered into 5-year commercial leases with Larry (and wife) on 20 terminals, with purchase options and first right of refusal--except for Pacific (for some reason). There's one lease Larry (and wife) own only 19%, so their share of $174,420 yearly lease payment is only $33,140. Larry (and wife) own 50% of ten leases and their share of $2,518,800 yearly is a nice $1,259,400 yearly. Hey!! That'll cover lunches all year.

Then there's 4 leases that Larry (and wife) own just over 42% of $985,200 lease payments yearly of which their share is $416,962. On 3 leases Larry (and wife) own 59% of $289,200 of which their share is $170,744 yearly.

Finally, Larry (and wife) own 100% of lease payments of $141,600. All 20 of these leases are 'triple net', which means the leassee (HTLD) pays all costs, maintenance, utilities, taxes, repairs, insurance and improvements. Larry (and wife) pay nothing further for property-related expenses, although there could be encumbrances we don't know about. So how does it add up??

Do the math: $2,021,846 yearly for 5 years, something over $10 million all told. Like Charlie Sheen famously said, after a while it starts to add up!

Summary of Larry Gordon's money from HTLD deal

$55 million in cash (50% of $110 million)
498,465 HTLD shares (worth $7,162,942 at $14.37 acquisition--more now)
$60,000 monthly Service Agreement with Valley Freightliner
$153,653 year share of one tractor lease
$4,397,299 year share of second tractor lease
$2,021,846 yearly share of 5 year commercial leases on 20 terminals

So how much of this is 'keeping money' and how much is just 'passing through', like your pay check each week? Dunno, really. Oh sure, the $55 million's keeping money, bank that. Think about how many deals Larry Gordon could have stepped into in the last 50-odd years that turned out bad, cowpies or tarbabies that Larry managed to extricate Gordon from, around and through. Think about what it took to guide GTI all these years from a dream, to another dream and another and turn those dreams into GTI.

Money's probably been just a sideshow to the main act.

A tool needed to build powerhouse Gordon Trucking.





/Happy Thanksgiving, all. I'm kinda a bah humbug myself. Temp was 22 degrees this morning and dropped to 19 degrees by 8 am. I'm putting together a 'heater' made up of an 8" concrete pipe with heat lamp pushed inside for the girls. Have a plug-in thermostat that turns on at 35 and off at 40. Will heat coop a little and keep their drinking water from freezing. No need for thermostat today, though. High 27. Still working on chicken coop today.

//HTLD close today, $18.43. That's up 41 cents a share today. Larry's 'up' $4.06/share (from $14.37) on 498,465 shares, a paper gain of $2,023,767 over the last 15 days.





​

 

This was the last paragraph of a long msg Calspring posted on another thread: http://www.thetruckersreport.com/tr...rator/233526-input-on-starting-new-fleet.html

What an intriguing idea! We did something like that between LA and Las Vegas. Called it the Ludlow turn-around. Ludlow was out in the middle of nowhere. Every night we ran a set of doubles out there and Wells Cargo sent a set from LV, they swapped and went home.

 

Don't see this every night around here. GTI tractor 36xx parked for the night at Spencer, IN (population < 2500) Wal-Mart. Young black driver walking to Wally from truck.

"You, Gordon?"

"Yeah."

"You mean, Heartland Express... "

"Yeah." (Uncomfy smile.)

"Any changes yet?"

"Nah, not really, not yet." (Same uncomfy smile.)


Of course, I used to park one right here, hard by the highway on Dean Hill. Still great equipment. Standing proud. Both here and in town. Had never seen another one in town, though.