Knight-Swift Transportation (KNX) Q4 2023 earnings summary

Executive summary

• Q4 revenue was $1,931.9M, up 10.8% YoY; GAAP net loss attributable was $10.7M, while Adjusted Net Income was $14.5M.

• Adjusted EPS was $0.09 vs. $1.00 YoY; the $71.7M third-party insurance operating loss reduced EPS by $0.30, and excluding it Adjusted EPS would have been $0.39.

• LTL remained strong while Truckload softness persisted; U.S. Xpress achieved positive Q4 Adjusted Operating Income.

Financial highlights

• Revenue excluding fuel surcharge was $1,692.2M vs. $1,515.8M; consolidated operating income was $18.3M, down 91.0% YoY.

• Adjusted Operating Income was $46.8M vs. $218.7M; Adjusted Operating Ratio was 97.2% vs. 85.6%.

• GAAP diluted EPS was $(0.07) vs. $0.92; Adjusted EPS was $0.09 vs. $1.00.

• Year-over-year comparability included a $17.8M increase in net interest expense.

Outlook and guidance

• Adjusted EPS guidance: Q1 2024 $0.37–$0.41; Q2 2024 $0.53–$0.57; visibility was shortened amid market and weather uncertainty.

• Truckload assumptions included slightly lower sequential margin in Q1 and improvement in Q2; contract rates were sequentially stable.

• H1 LTL assumptions included mid-to-high-single-digit YoY growth in shipments and revenue per hundredweight; Logistics volumes were expected to decline high-single digits sequentially in Q1 before partial recovery.

• Intermodal volumes were expected to be flat in Q1 and grow high-single digits in Q2; 2024 net cash capital expenditures were projected at $625M–$675M.