Radiant Logistics A Compellingly Priced Growth Compounder It’s the Network That Delivers ¡ Presented By: Buckley Capital Partners Buckley Capital Partners, LP Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 1 1
Buckley Capital Management LLC January 2016 1111 Lincoln Rd. Ste. 400 Miami Beach, FL 33139 The information presented herein is not an offer to sell or solicitation of an offer to buy an interest in Buckley Capital Partners, LP and must be supplemented by an Offering Memorandum (“the Memorandum”) when considering an investment. An investment may be made only after receipt and review of the Memorandum and execution of certain agreements. There can be no assurance that the Fund will achieve its objectives or not incur losses. Buckley Capital Partners, LP Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 2 2
Background • Introduction – Buckley Capital Management, LLC (BCM) is a long-biased, deep value-oriented equity fund focused on businesses with consistent long term growth, founded in Jan. 2011 – BCM’s objective is first and foremost the preservation of capital, while also producing above-average returns through conservative/heavily discounted equity investing with an open mandate to allow us to exploit market inefficiencies in any industry or market capitalization – BCM manages a limited partnership and separately managed accounts Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 3
Background • Investment Philosophy Overview – Buckley Capital Partners, LP is a long biased, value and special situation focused long biased equity fund – BCP’s discipline is to only invest in situations with asymmetric risk- reward return characteristics – The fund employs a fundamental approach that is research intensive and concentrated, focused primarily in small cap equities • Extensive due diligence and bottom-up research into every investment with periodic physical visits and close links with management • Evaluate an investment idea as if buying the entire company, with a focus on buying with a large margin of safety Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 4
Investment Philosophy • Core Strategy – Focus on transparent, predictable, underfollowed companies at very attractive valuations such as: • Owner-operator managers where the CEO is the founder and has the majority of his net worth in the business, thus properly incentivizing him • Businesses with a long term track record of compounding at a high growth rate • Invest in businesses that are only a small portion of their tangible addressable market (TAM) but could expand to a much larger portion of their market over time, providing a long runway for growth • High barriers to entry and high returns on equity, with the ability to profitably reinvest capital – Limited dependence on debt financing – Free optionality from hidden assets ¡ Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 5
Investment Criteria • Conviction comes from a profound understanding of the management team’s incentives and capabilities which is reinforced by frequent physical visits • Margin of safety: prefer great investments that are simple and transparent • Limited downside supported by high quality businesses with consistent, predictable cash flow generation and manageable debt – Cash and securities on balance sheet – Hidden tangible assets (e.g. stakes in other businesses/real estate) – High free cash flow yield Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 6
Investment Criteria • Rapid growth in the intrinsic value of the underlying business • Negative sentiment and/or short-term events can cause a fundamental disconnect between price and value • Conviction is essential. Should be compelled to buy more if the stock price fell with no change in the business fundamentals Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 7
Risk Management • Wealth Preserving Portfolio Construction – Little to no leverage – Invest in easy to understand, transparent businesses at great prices – Invest in companies: view investments as owning entire companies, not speculating on stock prices – Focus on asymmetries of returns: look for ‘fat pitch’ situations where probability-weighted risk-reward is heavily in our favor – Concentration: ideally comprised of 10-15 core long positions – Constantly reevaluate every investment: mistakes are inevitable, realizing them quickly and remaining emotionally unattached to securities is extremely important in protecting against capital loss Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 8
Performance Data BCP Monthly Performance (Net of Fees) Year Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Annual 2011 -0.70% 1.07% 14.98% 16.90% 4.80% 3.99% -1.64% 1.81% -5.23% -2.49% 7.69% 1.97% 49.44% 2012 2.19% 3.96% 1.09% -3.30% -1.43% 0.22% -1.62% -3.99% 2.49% 0.32% 5.57% 5.11% 10.60% 2013 6.21% 1.94% 0.67% -0.76% -0.03% -2.94% 2.93% -1.75% 9.76% -1.39% 4.22% 1.96% 22.06% 2014 -7.91% 4.74% 3.12% 5.00% 3.99% 5.11% -0.30% -0.50% -1.37% 10.17% -2.48% 5.33% 26.27% 2015 -2.15% 4.37% -6.88% 14.29% 3.33% 8.20% -6.28% -4.40% 0.66% 5.51% -9.93% -7.78% -3.23% Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 9
Performance Summary $3,500 $3,000 $2,500 $2,000 BCP S&P 500 $1,500 $1,000 $500 Ø Returns are net of fees, and reflect $1,000 invested in January 2011 Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 10
Terms & Service Providers General Partner Buckley Capital Management, LLC Minimum Investment $500,000 Management Fee 1.0% (paid quarterly in arrears) Carried Interest 20.0% High Water Mark Yes Broker M.S. Howells & Co. Custodian Pershing LLC Legal Greenberg Traurig, LLP Independent Auditor PwC Independent Administrator Michael J. Liccar & Company, LLC Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 11
Biography Of Presenter • Zack Buckley, Managing Partner In 2011, Mr. Buckley worked as an analyst for Baker Street Capital while simultaneously launching Buckley Capital. Mr. Buckley has been featured in The Wall Street Journal, Barron’s, Reuters, CNBC, Market Watch, Value Walk, Business Insider, and the Financial Post, and has also been a speaker at several Value Investing Congresses. Mr. Buckley graduated from the University of Miami with two degrees - a Bachelor of Arts (BA) in Economics and a Bachelor of Business Administration (BBA) in Accounting. ¡ Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 12
¡ It’s the Network That Delivers ¡ ¡ Stock: RLGT ¡ Headquarters: Bellevue, Washington Price: $2.97 52 Week Range: $2.95-$8.00 Mkt. Cap.: $145m Enterprise Value: $190m Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 13
Investment Thesis • RLGT is an asset light, high ROIC business trading at 10x earnings and 5.6x EBITDA • Given its unlevered balance sheet and accretive M&A opportunities, we believe RLGT will double earnings over the next 3 years • The ~60% price decline is not due to fundamental reasons • We believe RLGT’s earnings multiple should also be double where it currently is, and therefore the shares should trade at ~$12/share in 3 years vs. the current $3 share price, a ~50% IRR • RLGT recently issued a buyback; the last two times they have issued a buyback the stock has at least doubled in the subsequent 12 months Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 14
Why Are The Shares Mis-Priced? • All stocks in the transportation sector have been down significantly • XPO’s acquisition of Conway (an asset based trucking company) brought skepticism to whether other 3PL’s would switch to an asset based business model • Comments from some asset-owned carriers of lower spot pricing (the price at which transportation is transacted and delivered on now) in some sectors is a sign that the 3PL space is turning down and that the industry is soft. • None of these have an impact on RLGT’s business Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 15
Why These Reasons Are Unimportant • While all transportation stocks are down because of expected lower future growth, RLGT’s future growth profile is incredibly strong • Over the last decade, 3PL’s have consistently traded in the range of ~12x EBITDA. We think this will continue and RLGT should re-price closer to this level over time • While XPO changed their business strategy, RLGT has no intention of doing the same • Spot pricing does not have a significant impact on RLGT’s business. Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 16
Industry Association Data Does Not Suggest A Major Slowing In Shipments Buckley Capital Partners, LP PRIVATE & CONFIDENTIAL 17
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