Chairman and Chief Executive Officer,
“Despite the challenges that come with a soft freight market, our team found a way to be successful in 2023. We achieved our second-best adjusted earnings per diluted share in company history while improving the durability and diversification of our business through our acquisitions of
“For the fourth quarter, our asset-based segments contributed approximately 67% of total revenue, 74% of operating income, 63% of total freight revenue, and 76% of adjusted operating income in the quarter. While our asset-based segment’s total revenue declined, adjusted operating income remained comparable as a result of improved uptime and utilization with newer equipment and cost savings measures that we executed on.
“Our asset-light segments contributed approximately 33% of total revenue, 26% of operating income, 37% of total freight revenue, and 24% of adjusted operating income. Year over year declines in both revenue and operating income in our asset-light segments were primarily driven by our Managed Freight segment, which experienced significant reductions in both revenue and profitability with little to no project related freight in the current quarter. We were pleased that Warehousing was able to grow revenue through new customer startups and improve margins with contractual pricing increases put into place during the year. We are continuing to work to increase the operating income and related margins in each of these segments by executing on our pipeline of new business, focused cost savings initiatives and additional proposed customer rate increases with existing customers within Warehousing.
“Our 49% equity method investment with
A summary of our fourth quarter financial performance:
Three Months Ended | Year Ended | ||||||||||||||
($000s, except per share information) | 2023 | 2022 | 2023 | 2022 | |||||||||||
Total Revenue | $ | 273,985 | $ | 296,057 | $ | 1,103,573 | $ | 1,216,858 | |||||||
Freight Revenue, Excludes Fuel Surcharge | $ | 240,006 | $ | 255,327 | $ | 970,509 | $ | 1,046,396 | |||||||
Operating Income | $ | 14,267 | $ | 10,904 | $ | 58,823 | $ | 120,682 | |||||||
Adjusted Operating Income(1) | $ | 17,132 | $ | 22,010 | $ | 63,846 | $ | 97,244 | |||||||
Operating Ratio | 94.8 | % | 96.3 | % | 94.7 | % | 90.1 | % | |||||||
Adjusted Operating Ratio(1) | 92.9 | % | 91.4 | % | 93.4 | % | 90.7 | % | |||||||
Net Income | $ | 12,795 | $ | 11,504 | $ | 55,229 | $ | 108,682 | |||||||
Adjusted Net Income(1) | $ | 14,791 | $ | 19,522 | $ | 57,508 | $ | 90,543 | |||||||
Earnings per Diluted Share | $ | 0.93 | $ | 0.81 | $ | 3.99 | $ | 7.00 | |||||||
Adjusted Earnings per Diluted Share(1) | $ | 1.07 | $ | 1.37 | $ | 4.16 | $ | 5.84 | |||||||
(1) Represents non-GAAP measures. |
Truckload Operating Data and Statistics
Three Months Ended | Year Ended | ||||||||||||||
($000s, except statistical information) | 2023 | 2022 | 2023 | 2022 | |||||||||||
Combined Truckload | |||||||||||||||
Total Revenue | $ | 184,039 | $ | 198,339 | $ | 744,107 | $ | 815,710 | |||||||
Freight Revenue, excludes Fuel Surcharge | $ | 150,367 | $ | 157,911 | $ | 612,244 | $ | 646,559 | |||||||
Operating Income | $ | 10,593 | $ | 2,094 | $ | 46,573 | $ | 81,639 | |||||||
Adj. Operating Income(1) | $ | 12,935 | $ | 12,906 | $ | 49,945 | $ | 57,024 | |||||||
Operating Ratio | 94.2 | % | 98.9 | % | 93.7 | % | 90.0 | % | |||||||
Adj. Operating Ratio(1) | 91.4 | % | 91.8 | % | 91.8 | % | 91.2 | % | |||||||
Average Freight Revenue per Tractor per Week | $ | 5,344 | $ | 5,417 | $ | 5,549 | $ | 5,388 | |||||||
Average Freight Revenue per Total Mile | $ | 2.31 | $ | 2.53 | $ | 2.34 | $ | 2.45 | |||||||
Average Miles per Tractor per Period | 30,410 | 28,116 | 123,896 | 114,636 | |||||||||||
Weighted Average Tractors for Period | 2,141 | 2,218 | 2,116 | 2,301 | |||||||||||
Expedited | |||||||||||||||
Total Revenue | $ | 105,432 | $ | 114,479 | $ | 423,820 | $ | 452,713 | |||||||
Freight Revenue, excludes Fuel Surcharge | $ | 84,463 | $ | 90,364 | $ | 343,779 | $ | 355,360 | |||||||
Operating Income | $ | 6,247 | $ | 5,972 | $ | 28,861 | $ | 60,552 | |||||||
Adj. Operating Income(1) | $ | 7,272 | $ | 10,334 | $ | 31,156 | $ | 45,927 | |||||||
Operating Ratio | 94.1 | % | 94.8 | % | 93.2 | % | 86.6 | % | |||||||
Adj. Operating Ratio(1) | 91.4 | % | 88.6 | % | 90.9 | % | 87.1 | % | |||||||
Average Freight Revenue per Tractor per Week | $ | 7,024 | $ | 7,639 | $ | 7,501 | $ | 7,604 | |||||||
Average Freight Revenue per Total Mile | $ | 2.09 | $ | 2.39 | $ | 2.13 | $ | 2.32 | |||||||
Average Miles per Tractor per Period | 44,081 | 42,073 | 183,717 | 170,925 | |||||||||||
Weighted Average Tractors for Period | 915 | 900 | 879 | 896 | |||||||||||
Dedicated | |||||||||||||||
Total Revenue | $ | 78,607 | $ | 83,860 | $ | 320,287 | $ | 362,997 | |||||||
Freight Revenue, excludes Fuel Surcharge | $ | 65,904 | $ | 67,547 | $ | 268,465 | $ | 291,199 | |||||||
Operating Income (Loss) | $ | 4,346 | $ | (3,878 | ) | $ | 17,712 | $ | 21,087 | ||||||
Adj. Operating Income(1) | $ | 5,663 | $ | 2,572 | $ | 18,789 | $ | 11,097 | |||||||
Operating Ratio | 94.5 | % | 104.6 | % | 94.5 | % | 94.2 | % | |||||||
Adj. Operating Ratio(1) | 91.4 | % | 96.2 | % | 93.0 | % | 96.2 | % | |||||||
Average Freight Revenue per Tractor per Week | $ | 4,090 | $ | 3,899 | $ | 4,162 | $ | 3,975 | |||||||
Average Freight Revenue per Total Mile | $ | 2.66 | $ | 2.76 | $ | 2.67 | $ | 2.63 | |||||||
Average Miles per Tractor per Period | 20,207 | 18,586 | 81,387 | 78,728 | |||||||||||
Weighted Average Tractors for Period | 1,226 | 1,318 | 1,237 | 1,405 | |||||||||||
(1) Represents non-GAAP measures. |
Combined Truckload Revenue
Expedited Truckload Revenue
Dedicated Truckload Revenue
“For the quarter, freight revenue in our Dedicated segment decreased $1.6 million, or 2.4%. Average total tractors decreased by 92 units or 7.0% to 1,226, compared to 1,318 in the prior year quarter. The decrease in tractors was attributable to the combination of the intentional exit of underperforming business and truck reductions negotiated with current customers needing less capacity. These reductions were partially offset by the acquisition of
Combined Truckload Operating Expenses
“Salaries and wages and related expenses decreased year-over-year by
“Operations and maintenance related expense decreased by
“Insurance and claims expense decreased by
“Fixed expenses related to revenue producing equipment, including depreciation, gain on sale, rent and lease expense increased in the fourth quarter by approximately
Managed Freight Segment
Three Months Ended | Year Ended | ||||||||||||||
($000s) | 2023 | 2022 | 2023 | 2022 | |||||||||||
Freight Revenue | $ | 65,035 | $ | 76,171 | $ | 258,903 | $ | 320,985 | |||||||
Operating Income | $ | 2,484 | $ | 8,795 | $ | 9,388 | $ | 36,858 | |||||||
Adj. Operating Income (1) | $ | 2,748 | $ | 8,830 | $ | 9,924 | $ | 36,999 | |||||||
Operating Ratio | 96.2 | % | 88.5 | % | 96.4 | % | 88.5 | % | |||||||
Adj. Operating Ratio (1) | 95.8 | % | 88.4 | % | 96.2 | % | 88.5 | % | |||||||
(1) Represents non-GAAP measures. |
“For the quarter, Managed Freight’s freight revenue decreased 14.6%, from the prior year quarter. Operating income and adjusted operating income declined approximately 71.6% and 68.8%, respectively, compared to the fourth quarter of 2022 as a result of reduced volumes of high-margin overflow freight from both Expedited and Dedicated truckload operations. Revenue and operating income in this segment are expected to fluctuate with changes in the freight market and our percentage of contracted versus non-contracted freight.”
Warehousing Segment
Three Months Ended | Year Ended | ||||||||||||||
($000s) | 2023 | 2022 | 2023 | 2022 | |||||||||||
Freight Revenue | $ | 24,604 | $ | 21,245 | $ | 99,362 | $ | 78,852 | |||||||
Operating Income | $ | 1,190 | $ | 15 | $ | 2,862 | $ | 2,185 | |||||||
Adj. Operating Income (1) | $ | 1,449 | $ | 274 | $ | 3,977 | $ | 3,221 | |||||||
Operating Ratio | 95.2 | % | 99.9 | % | 97.2 | % | 97.3 | % | |||||||
Adj. Operating Ratio (1) | 94.1 | % | 98.7 | % | 96.0 | % | 95.9 | % | |||||||
(1) Represents non-GAAP measures. |
“For the quarter, Warehousing’s freight revenue increased 15.8% versus the prior year quarter. The increase in revenue was primarily driven by the year-over-year impact of new customer business added during the current year as well as customer rate increases that began during the quarter. Operating income and adjusted operating income for the Warehousing segment increased
Capitalization, Liquidity and Capital Expenditures
“At
“Our capital allocation for the year included approximately
“Our 2023 net capital investment included approximately
“Considering our significant net capital investment in the quarter, our baseline expectation for net capital expenditures in 2024 is
Outlook
“As we look to 2024, we do not see anything in the first half of the year that would indicate a near-term recovery of the freight market. We anticipate a continuation of difficult conditions where capacity continues to exit the market at a rate that yields steady but modest improvement. In the first quarter, we expect our revenue and earnings to decline, reflecting normal seasonality and the temporary headwinds of severe inclement weather conditions, year over year rate reductions in our Expedited segment and incremental costs associated with a large new customer startup within our Dedicated segment. Despite these short-term headwinds, we believe our more resilient operating model, together with the steps we have taken to reduce costs and inefficiencies, have positioned us well for another successful year.”
Conference Call Information
The Company will host a live conference call tomorrow,
(1) See GAAP to Non-GAAP Reconciliation in the schedules included with this release. In addition to operating income (loss), operating ratio, net income, and earnings per diluted share, we use adjusted operating income (loss), adjusted operating ratio, adjusted net income, and adjusted earnings per diluted share, non-GAAP measures, as key measures of profitability. Adjusted operating income (loss), adjusted operating ratio, adjusted net income, and adjusted diluted earnings per share are not substitutes for operating income (loss), operating ratio, net income, and earnings per diluted share measured in accordance with GAAP. There are limitations to using non-GAAP financial measures. We believe our presentation of these non-GAAP financial measures are useful because it provides investors and securities analysts with supplemental information that we use internally for purposes of assessing profitability. Further, our Board and management use non-GAAP operating income (loss), operating ratio, net income, and earnings per diluted share measures on a supplemental basis to remove items that may not be an indicator of performance from period-to-period. Although we believe that adjusted operating income (loss), adjusted operating ratio, adjusted net income, and adjusted diluted earnings per share improves comparability in analyzing our period-to-period performance, they could limit comparability to other companies in our industry, if those companies define such measures differently. Because of these limitations, adjusted operating income (loss), adjusted operating ratio, adjusted net income, and adjusted earnings per diluted share should not be considered measures of income generated by our business or discretionary cash available to us to invest in the growth of our business. Management compensates for these limitations by primarily relying on GAAP results and using non-GAAP financial measures on a supplemental basis.
This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such statements may be identified by their use of terms or phrases such as “expects,” “estimates,” “projects,” “believes,” “anticipates,” “plans,” “could,” “would,” “may,” “will,” "intends," “outlook,” “focus,” “seek,” “potential,” “mission,” “continue,” “goal,” “target,” “objective,” derivations thereof, and similar terms and phrases. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. In this press release, statements relating to future availability and covenant testing under our ABL credit facility, Managed Freight performance and related impacts, net capital expenditures and related priorities, benefits, and returns, capital allocation alternatives, progress toward our strategic goals, the resiliency of our model, and the statements under “Outlook” are forward-looking statements. The following factors, among others could cause actual results to differ materially from those in the forward-looking statements: Our business is subject to economic, credit, business, and regulatory factors affecting the truckload industry that are largely beyond our control; We may not be successful in achieving our strategic plan; We operate in a highly competitive and fragmented industry; We may not grow substantially in the future and we may not be successful in improving our profitability; We may not make acquisitions in the future, or if we do, we may not be successful in our acquisition strategy; The conflict between
For further information contact:
PBunn@covenantlogistics.com
TGrant@covenantlogistics.com
For copies of Company information contact:
BMcKenzie@covenantlogistics.com
Key Financial and Operating Statistics | |||||||||||||||||||||||
Income Statement Data | |||||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||||
($s in 000s, except per share data) | 2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||||||||||||
Revenues | |||||||||||||||||||||||
Freight revenue | $ | 240,006 | $ | 255,327 | (6.0 | %) | $ | 970,509 | $ | 1,046,396 | (7.3 | %) | |||||||||||
Fuel surcharge revenue | 33,979 | 40,730 | (16.6 | %) | 133,064 | 170,462 | (21.9 | %) | |||||||||||||||
Total revenue | $ | 273,985 | $ | 296,057 | (7.5 | %) | $ | 1,103,573 | $ | 1,216,858 | (9.3 | %) | |||||||||||
Operating expenses: | |||||||||||||||||||||||
Salaries, wages, and related expenses | 97,738 | 101,295 | 400,491 | 402,276 | |||||||||||||||||||
Fuel expense | 32,599 | 39,954 | 133,291 | 166,410 | |||||||||||||||||||
Operations and maintenance | 13,425 | 18,803 | 63,753 | 79,051 | |||||||||||||||||||
Revenue equipment rentals and purchased transportation | 68,848 | 81,343 | 271,893 | 325,624 | |||||||||||||||||||
Operating taxes and licenses | 3,248 | 3,213 | 13,409 | 11,931 | |||||||||||||||||||
Insurance and claims | 13,289 | 14,794 | 50,099 | 50,547 | |||||||||||||||||||
Communications and utilities | 1,259 | 1,662 | 5,012 | 5,385 | |||||||||||||||||||
General supplies and expenses | 11,275 | 9,346 | 49,444 | 37,762 | |||||||||||||||||||
Depreciation and amortization | 18,242 | 15,778 | 69,943 | 57,512 | |||||||||||||||||||
Gain on disposition of property and equipment, net | (205 | ) | (1,035 | ) | (12,585 | ) | (40,322 | ) | |||||||||||||||
Total operating expenses | 259,718 | 285,153 | 1,044,750 | 1,096,176 | |||||||||||||||||||
Operating income | 14,267 | 10,904 | 58,823 | 120,682 | |||||||||||||||||||
Interest expense, net | 2,437 | 827 | 7,967 | 3,083 | |||||||||||||||||||
Income from equity method investment | (4,725 | ) | (3,931 | ) | (21,384 | ) | (25,193 | ) | |||||||||||||||
Income from continuing operations before income taxes | 16,555 | 14,008 | 72,240 | 142,792 | |||||||||||||||||||
Income tax expense | 3,910 | 2,729 | 17,611 | 34,860 | |||||||||||||||||||
Income from continuing operations | 12,645 | 11,279 | 54,629 | 107,932 | |||||||||||||||||||
Income from discontinued operations, net of tax | 150 | 225 | 600 | 750 | |||||||||||||||||||
Net income | $ | 12,795 | $ | 11,504 | $ | 55,229 | $ | 108,682 | |||||||||||||||
Basic earnings per share | |||||||||||||||||||||||
Income from continuing operations | $ | 0.98 | $ | 0.83 | $ | 4.19 | $ | 7.19 | |||||||||||||||
Income from discontinued operations | $ | 0.01 | $ | 0.02 | $ | 0.05 | $ | 0.05 | |||||||||||||||
Net income per basic share | $ | 0.99 | $ | 0.85 | $ | 4.23 | $ | 7.24 | |||||||||||||||
Diluted earnings per share | |||||||||||||||||||||||
Income from continuing operations | $ | 0.92 | $ | 0.79 | $ | 3.95 | $ | 6.95 | |||||||||||||||
Income from discontinued operations | $ | 0.01 | $ | 0.02 | $ | 0.04 | $ | 0.05 | |||||||||||||||
Net income per diluted share | $ | 0.93 | $ | 0.81 | $ | 3.99 | $ | 7.00 | |||||||||||||||
Basic weighted average shares outstanding (000s) | 12,949 | 13,544 | 13,048 | 15,006 | |||||||||||||||||||
Diluted weighted average shares outstanding (000s) | 13,710 | 14,205 | 13,834 | 15,524 |
Segment Freight Revenues | |||||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||||
($s in 000's) | 2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||||||||||||
Expedited - Truckload | $ | 84,463 | $ | 90,364 | (6.5 | %) | $ | 343,779 | $ | 355,360 | (3.3 | %) | |||||||||||
Dedicated - Truckload | 65,904 | 67,547 | (2.4 | %) | 268,465 | 291,199 | (7.8 | %) | |||||||||||||||
Combined Truckload | 150,367 | 157,911 | (4.8 | %) | 612,244 | 646,559 | (5.3 | %) | |||||||||||||||
Managed Freight | 65,035 | 76,171 | (14.6 | %) | 258,903 | 320,985 | (19.3 | %) | |||||||||||||||
Warehousing | 24,604 | 21,245 | 15.8 | % | 99,362 | 78,852 | 26.0 | % | |||||||||||||||
Consolidated Freight Revenue | $ | 240,006 | $ | 255,327 | (6.0 | %) | $ | 970,509 | $ | 1,046,396 | (7.3 | %) |
Truckload Operating Statistics | |||||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||||
2023 | 2022 | % Change | 2023 | 2022 | % Change | ||||||||||||||||||
Average freight revenue per loaded mile | $ | 2.64 | $ | 2.86 | (7.7 | %) | $ | 2.66 | $ | 2.77 | (4.0 | %) | |||||||||||
Average freight revenue per total mile | $ | 2.31 | $ | 2.53 | (8.7 | %) | $ | 2.34 | $ | 2.45 | (4.5 | %) | |||||||||||
Average freight revenue per tractor per week | $ | 5,344 | $ | 5,417 | (1.3 | %) | $ | 5,549 | $ | 5,388 | 3.0 | % | |||||||||||
Average miles per tractor per period | 30,410 | 28,116 | 8.2 | % | 123,896 | 114,636 | 8.1 | % | |||||||||||||||
Weighted avg. tractors for period | 2,141 | 2,218 | (3.5 | %) | 2,116 | 2,301 | (8.0 | %) | |||||||||||||||
Tractors at end of period | 2,139 | 2,138 | 0.0 | % | 2,139 | 2,138 | 0.0 | % | |||||||||||||||
Trailers at end of period | 5,880 | 5,367 | 9.6 | % | 5,880 | 5,367 | 9.6 | % |
Selected Balance Sheet Data | |||||||
($s in '000's, except per share data) | |||||||
Total assets | $ | 954,438 | $ | 796,645 | |||
Total stockholders' equity | $ | 403,420 | $ | 377,128 | |||
Total indebtedness, comprised of total debt and finance leases, net of cash | $ | 248,329 | $ | 46,356 | |||
Net Indebtedness to Capitalization Ratio | 38.1 | % | 10.9 | % | |||
Leverage Ratio(1) | 2.14 | 0.34 | |||||
Tangible book value per end-of-quarter basic share | $ | 17.45 | $ | 19.97 | |||
(1) Leverage Ratio is calculated as average total indebtedness, comprised of total debt and finance leases, net of cash, divided by the trailing twelve months sum of operating income (loss), depreciation and amortization, and gain on disposition of property and equipment, net. |
Non-GAAP Reconciliation (Unaudited) | ||||||||||||||||||||||
Adjusted Operating Income and Adjusted Operating Ratio(1) | ||||||||||||||||||||||
(Dollars in thousands) | Three Months Ended | Year Ended | ||||||||||||||||||||
GAAP Presentation | 2023 | 2022 | bps Change | 2023 | 2022 | bps Change | ||||||||||||||||
Total revenue | $ | 273,985 | $ | 296,057 | $ | 1,103,573 | $ | 1,216,858 | ||||||||||||||
Total operating expenses | 259,718 | 285,153 | 1,044,750 | 1,096,176 | ||||||||||||||||||
Operating income | $ | 14,267 | $ | 10,904 | $ | 58,823 | $ | 120,682 | ||||||||||||||
Operating ratio | 94.8 | % | 96.3 | % | (150 | ) | 94.7 | % | 90.1 | % | 460 | |||||||||||
Non-GAAP Presentation | 2023 | 2022 | bps Change | 2023 | 2022 | bps Change | ||||||||||||||||
Total revenue | $ | 273,985 | $ | 296,057 | $ | 1,103,573 | $ | 1,216,858 | ||||||||||||||
Fuel surcharge revenue | (33,979 | ) | (40,730 | ) | (133,064 | ) | (170,462 | ) | ||||||||||||||
Freight revenue (total revenue, excluding fuel surcharge) | 240,006 | 255,327 | 970,509 | 1,046,396 | ||||||||||||||||||
Total operating expenses | 259,718 | 285,153 | 1,044,750 | 1,096,176 | ||||||||||||||||||
Adjusted for: | ||||||||||||||||||||||
Fuel surcharge revenue | (33,979 | ) | (40,730 | ) | (133,064 | ) | (170,462 | ) | ||||||||||||||
Amortization of intangibles(2) | (2,373 | ) | (1,121 | ) | (7,515 | ) | (4,306 | ) | ||||||||||||||
Gain on disposal of terminals, net | - | - | 7,627 | 38,542 | ||||||||||||||||||
Contingent consideration liability adjustment | (492 | ) | - | (2,977 | ) | (813 | ) | |||||||||||||||
Transaction and executive retirement | - | - | (2,158 | ) | - | |||||||||||||||||
Abandonment of revenue equipment | - | (9,985 | ) | - | (9,985 | ) | ||||||||||||||||
Adjusted operating expenses | 222,874 | 233,317 | 906,663 | 949,152 | ||||||||||||||||||
Adjusted operating income | 17,132 | 22,010 | 63,846 | 97,244 | ||||||||||||||||||
Adjusted operating ratio | 92.9 | % | 91.4 | % | 150 | 93.4 | % | 90.7 | % | 270 | ||||||||||||
(1) Pursuant to the requirements of Regulation G, this table reconciles consolidated GAAP operating income and operating ratio to consolidated non-GAAP Adjusted operating income and Adjusted operating ratio. | ||||||||||||||||||||||
(2) "Amortization of intangibles" reflects the non-cash amortization expense relating to intangible assets. |
Non-GAAP Reconciliation (Unaudited) | |||||||||||||||
Adjusted Net Income and Adjusted EPS(1) | |||||||||||||||
(Dollars in thousands) | Three Months Ended | Year Ended | |||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
GAAP Presentation - Net income | $ | 12,795 | $ | 11,504 | $ | 55,229 | $ | 108,682 | |||||||
Adjusted for: | |||||||||||||||
Amortization of intangibles(2) | 2,373 | 1,121 | 7,515 | 4,306 | |||||||||||
Discontinued operations reversal of loss contingency(3) | (200 | ) | (300 | ) | (800 | ) | (1,000 | ) | |||||||
Gain on disposal of terminals, net | - | - | (7,627 | ) | (38,542 | ) | |||||||||
Contingent consideration liability adjustment | 492 | - | 2,977 | 813 | |||||||||||
Transaction and executive retirement | - | - | 2,158 | - | |||||||||||
Abandonment of revenue equipment | - | 9,985 | - | 9,985 | |||||||||||
Total adjustments before taxes | 2,665 | 10,806 | 4,223 | (24,438 | ) | ||||||||||
Provision for income tax expense at effective rate | (669 | ) | (2,788 | ) | (944 | ) | 6,299 | ||||||||
Tax effected adjustments | $ | 1,996 | $ | 8,018 | $ | 3,279 | $ | (18,139 | ) | ||||||
- | - | (1,000 | ) | - | |||||||||||
Non-GAAP Presentation - Adjusted net income | $ | 14,791 | $ | 19,522 | $ | 57,508 | $ | 90,543 | |||||||
GAAP Presentation - Diluted earnings per share ("EPS") | $ | 0.93 | $ | 0.81 | $ | 3.99 | $ | 7.00 | |||||||
Adjusted for: | |||||||||||||||
Amortization of intangibles(2) | 0.17 | 0.08 | 0.54 | 0.28 | |||||||||||
Discontinued operations reversal of loss contingency(3) | (0.02 | ) | (0.02 | ) | (0.06 | ) | (0.06 | ) | |||||||
Gain on sale of terminal, net | - | - | (0.55 | ) | (2.48 | ) | |||||||||
Contingent consideration liability adjustment | 0.04 | - | 0.22 | 0.05 | |||||||||||
Transaction and executive retirement | - | - | 0.16 | - | |||||||||||
Abandonment of revenue equipment | - | 0.70 | - | 0.64 | |||||||||||
Total adjustments before taxes | 0.19 | 0.76 | 0.31 | (1.57 | ) | ||||||||||
Provision for income tax expense at effective rate | (0.05 | ) | (0.20 | ) | (0.07 | ) | 0.41 | ||||||||
Tax effected adjustments | $ | 0.14 | $ | 0.56 | $ | 0.24 | $ | (1.16 | ) | ||||||
- | - | (0.07 | ) | - | |||||||||||
Non-GAAP Presentation - Adjusted EPS | $ | 1.07 | $ | 1.37 | $ | 4.16 | $ | 5.84 | |||||||
(1) Pursuant to the requirements of Regulation G, this table reconciles consolidated GAAP net income to consolidated non-GAAP adjusted net income and consolidated GAAP diluted earnings per share to non-GAAP consolidated Adjusted EPS. | |||||||||||||||
(2) "Amortization of intangibles" reflects the non-cash amortization expense relating to intangible assets. | |||||||||||||||
(3) "Discontinued Operations reversal of loss contingency" reflects the non-cash reversal of a previously recorded loss contingency that is no longer considered probable. The original loss contingency was recorded in Q4 2020 as a result of our disposal of our former accounts receivable factoring segment, TFS. |
Non-GAAP Reconciliation (Unaudited) | |||||||||||||||||||||||||||||||||||||||
Adjusted Operating Income and Adjusted Operating Ratio (1) | |||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Three Months Ended | ||||||||||||||||||||||||||||||||||||||
GAAP Presentation | 2023 | 2022 | |||||||||||||||||||||||||||||||||||||
Expedited | Dedicated | Combined Truckload | Managed Freight | Warehousing | Expedited | Dedicated | Combined Truckload | Managed Freight | Warehousing | ||||||||||||||||||||||||||||||
Total revenue | $ | 105,432 | $ | 78,607 | $ | 184,039 | $ | 65,035 | $ | 24,911 | $ | 114,479 | $ | 83,860 | $ | 198,339 | $ | 76,171 | $ | 21,547 | |||||||||||||||||||
Total operating expenses | 99,185 | 74,261 | $ | 173,446 | $ | 62,551 | 23,721 | 108,507 | 87,738 | 196,245 | 67,376 | 21,532 | |||||||||||||||||||||||||||
Operating income (loss) | $ | 6,247 | $ | 4,346 | $ | 10,593 | $ | 2,484 | $ | 1,190 | $ | 5,972 | $ | (3,878 | ) | $ | 2,094 | $ | 8,795 | $ | 15 | ||||||||||||||||||
Operating ratio | 94.1 | % | 94.5 | % | 94.2 | % | 96.2 | % | 95.2 | % | 94.8 | % | 104.6 | % | 98.9 | % | 88.5 | % | 99.9 | % | |||||||||||||||||||
Non-GAAP Presentation | |||||||||||||||||||||||||||||||||||||||
Total revenue | $ | 105,432 | $ | 78,607 | $ | 184,039 | $ | 65,035 | $ | 24,911 | $ | 114,479 | $ | 83,860 | $ | 198,339 | $ | 76,171 | $ | 21,547 | |||||||||||||||||||
Fuel surcharge revenue | (20,969 | ) | (12,703 | ) | (33,672 | ) | - | (307 | ) | (24,115 | ) | (16,313 | ) | (40,428 | ) | - | (302 | ) | |||||||||||||||||||||
Freight revenue (total revenue, excluding fuel surcharge) | 84,463 | 65,904 | 150,367 | 65,035 | 24,604 | 90,364 | 67,547 | 157,911 | 76,171 | 21,245 | |||||||||||||||||||||||||||||
Total operating expenses | 99,185 | 74,261 | 173,446 | 62,551 | 23,721 | 108,507 | 87,738 | 196,245 | 67,376 | 21,532 | |||||||||||||||||||||||||||||
Adjusted for: | |||||||||||||||||||||||||||||||||||||||
Fuel surcharge revenue | (20,969 | ) | (12,703 | ) | (33,672 | ) | - | (307 | ) | (24,115 | ) | (16,313 | ) | (40,428 | ) | - | (302 | ) | |||||||||||||||||||||
Amortization of intangibles (2) | (533 | ) | (1,317 | ) | (1,850 | ) | (264 | ) | (259 | ) | (533 | ) | (294 | ) | (827 | ) | (35 | ) | (259 | ) | |||||||||||||||||||
Contingent consideration liability adjustment | (492 | ) | - | (492 | ) | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
Abandonment of revenue equipment | - | - | - | - | - | (3,829 | ) | (6,156 | ) | (9,985 | ) | - | - | ||||||||||||||||||||||||||
Adjusted operating expenses | 77,191 | 60,241 | 137,432 | 62,287 | 23,155 | 80,030 | 64,975 | 145,005 | 67,341 | 20,971 | |||||||||||||||||||||||||||||
Adjusted operating income | 7,272 | 5,663 | 12,935 | 2,748 | 1,449 | 10,334 | 2,572 | 12,906 | 8,830 | 274 | |||||||||||||||||||||||||||||
Adjusted operating ratio | 91.4 | % | 91.4 | % | 91.4 | % | 95.8 | % | 94.1 | % | 88.6 | % | 96.2 | % | 91.8 | % | 88.4 | % | 98.7 | % |
Year Ended | |||||||||||||||||||||||||||||||||||||||
GAAP Presentation | 2023 | 2022 | |||||||||||||||||||||||||||||||||||||
Expedited | Dedicated | Combined Truckload | Managed Freight | Warehousing | Expedited | Dedicated | Combined Truckload | Managed Freight | Warehousing | ||||||||||||||||||||||||||||||
Total revenue | $ | 423,820 | $ | 320,287 | $ | 744,107 | $ | 258,903 | $ | 100,563 | $ | 452,713 | $ | 362,997 | $ | 815,710 | $ | 320,985 | $ | 80,163 | |||||||||||||||||||
Total operating expenses | 394,959 | $ | 302,575 | $ | 697,534 | $ | 249,515 | $ | 97,701 | $ | 392,161 | $ | 341,910 | $ | 734,071 | $ | 284,127 | $ | 77,978 | ||||||||||||||||||||
Operating income | $ | 28,861 | $ | 17,712 | $ | 46,573 | $ | 9,388 | $ | 2,862 | $ | 60,552 | $ | 21,087 | $ | 81,639 | $ | 36,858 | $ | 2,185 | |||||||||||||||||||
Operating ratio | 93.2 | % | 94.5 | % | 93.7 | % | 96.4 | % | 97.2 | % | 86.6 | % | 94.2 | % | 90.0 | % | 88.5 | % | 97.3 | % | |||||||||||||||||||
Non-GAAP Presentation | |||||||||||||||||||||||||||||||||||||||
Total revenue | $ | 423,820 | $ | 320,287 | $ | 744,107 | $ | 258,903 | $ | 100,563 | $ | 452,713 | $ | 362,997 | $ | 815,710 | $ | 320,985 | $ | 80,163 | |||||||||||||||||||
Fuel surcharge revenue | (80,041 | ) | (51,822 | ) | (131,863 | ) | - | (1,201 | ) | (97,353 | ) | (71,798 | ) | (169,151 | ) | - | (1,311 | ) | |||||||||||||||||||||
Freight revenue (total revenue, excluding fuel surcharge) | 343,779 | 268,465 | 612,244 | 258,903 | 99,362 | 355,360 | 291,199 | 646,559 | 320,985 | 78,852 | |||||||||||||||||||||||||||||
Total operating expenses | 394,959 | 302,575 | 697,534 | 249,515 | 97,701 | 392,161 | 341,910 | 734,071 | 284,127 | 77,978 | |||||||||||||||||||||||||||||
Adjusted for: | |||||||||||||||||||||||||||||||||||||||
Fuel surcharge revenue | (80,041 | ) | (51,822 | ) | (131,863 | ) | - | (1,201 | ) | (97,353 | ) | (71,798 | ) | (169,151 | ) | - | (1,311 | ) | |||||||||||||||||||||
Amortization of intangibles (2) | (2,133 | ) | (3,900 | ) | (6,033 | ) | (446 | ) | (1,036 | ) | (1,956 | ) | (1,173 | ) | (3,129 | ) | (141 | ) | (1,036 | ) | |||||||||||||||||||
Gain on disposal of terminals, net | 3,928 | 3,699 | 7,627 | - | - | 21,223 | 17,319 | 38,542 | - | - | |||||||||||||||||||||||||||||
Contingent consideration liability adjustment | (2,977 | ) | - | (2,977 | ) | - | - | (813 | ) | - | (813 | ) | - | - | |||||||||||||||||||||||||
Transaction and executive retirement | (1,113 | ) | (876 | ) | (1,989 | ) | (90 | ) | (79 | ) | - | - | - | - | - | ||||||||||||||||||||||||
Abandonment of revenue equipment | - | - | - | - | - | (3,829 | ) | (6,156 | ) | (9,985 | ) | - | - | ||||||||||||||||||||||||||
Adjusted operating expenses | 312,623 | 249,676 | 562,299 | 248,979 | 95,385 | 309,433 | 280,102 | 589,535 | 283,986 | 75,631 | |||||||||||||||||||||||||||||
Adjusted operating income | 31,156 | 18,789 | 49,945 | 9,924 | 3,977 | 45,927 | 11,097 | 57,024 | 36,999 | 3,221 | |||||||||||||||||||||||||||||
Adjusted operating ratio | 90.9 | % | 93.0 | % | 91.8 | % | 96.2 | % | 96.0 | % | 87.1 | % | 96.2 | % | 91.2 | % | 88.5 | % | 95.9 | % | |||||||||||||||||||
(1) Pursuant to the requirements of Regulation G, this table reconciles consolidated GAAP operating income and operating ratio to consolidated non-GAAP Adjusted operating income and Adjusted operating ratio. | |||||||||||||||||||||||||||||||||||||||
(2) "Amortization of intangibles" reflects the non-cash amortization expense relating to intangible assets. |
Source:
2024 GlobeNewswire, Inc., source