PHOENIX - Knight-Swift Transportation Holdings Inc. (NYSE: KNX), a leader in freight transportation, reported mixed financial results for the second quarter of 2024. Shares were down 2% following the results.
The company's adjusted earnings per share (EPS) of $0.30 exceeded analyst estimates by $0.03, while GAAP EPS fell to $0.13 from $0.39 in the same period last year. Total revenue increased 18.9% to $1.85 billion, surpassing the consensus estimate of $1.84 billion and marking significant growth from $1.55 billion reported in the second quarter of 2023.
Despite beating revenue expectations and posting a year-over-year (YoY) increase, the company's operating income saw a substantial decrease of 32.5% compared to the previous year, standing at $63.5 million. The adjusted net income attributable to Knight-Swift also declined by 49.9% YoY to $39.4 million. The results included a $12.5 million pre-tax charge for an auto liability claim settlement from 2020, which had a $0.06 per share negative impact on the adjusted EPS. Excluding this settlement, the adjusted EPS would have been $0.30, indicating the company's resilience amid challenging market conditions.
The truckload segment experienced a 33.0% increase in revenue, excluding fuel surcharge and intersegment transactions, primarily due to the acquisition of U.S. Xpress Enterprises, Inc. However, the truckload operating income dropped by 65.4%, with an adjusted operating ratio of 97.2%. The less-than-truckload (LTL) segment showed a healthier performance with a 15.1% increase in revenues, excluding fuel surcharge, and an 8.2% growth in adjusted operating income.
Adam Miller, CEO of Knight-Swift, acknowledged the full truckload market's challenges and emphasized the company's focus on disciplined pricing and cost control. He also expressed optimism about the LTL segment's growth and the company's expansion plans, which include opening 20 more facilities by the end of 2024.
Looking ahead, Knight-Swift remains confident in its business model and its ability to navigate a difficult environment while preparing for a market upturn. The company projects a full-year 2024 effective tax rate of approximately 29% to 30%.
The company's board declared a quarterly cash dividend of $0.16 per share, payable on June 24, 2024, to stockholders of record as of June 10, 2024.
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