Earnings Watch: Knight-Swift Affected by Merger Costs, Driver Shortage
Truckload and logistics provider Knight-Swift Transportation Holdings Inc. released third quarter earnings on Monday that showed a big drop in profit compared to a year ago, but officials said the numbers do not paint an entirely accurate picture following Knight Transportation’s acquisition of Swift Transportation, which closed in September.
Net income totaled $4.2 million, or 4 cents per share, compared to $24.1 billion, or 29 cents per share, a year earlier for Knight Transportation alone.
Total revenue nearly doubled to $521.6 million from $280.5 million in the third quarter of 2016.
The reported results include the results of Swift Transportation only for 22 days after the Sept. 8 merger date, as well as significant merger-related costs, meaning comparisons to prior periods are not meaningful, according to the company.
“Our diluted earnings per share for the third quarter were 4 cents, which includes $12.3 million of legal and professional fees related to the merger with Swift, $6.6 million of other one-time operating expenses associated with the merger, $16.7 million of impairment of software assets identified after the merger and $2.5 million of amortization expense related to the $817.2 million of amortizable intangible assets recorded as a result of the merger,” said Dave Jackson, president and CEO.
Excluding these items, the company’s adjusted diluted earnings per share for the third quarter were 25 cents compared to 29 cents a year earlier.
“The freight environment has strengthened throughout the third quarter and into October,” Jackson said. “The non-contract market improved each month sequentially, leading to a 4.6% year over year increase in Knight’s revenue per loaded mile, excluding fuel surcharges, for the quarter.”
According to Jackson, strong freight demand is beginning to impact both the contract market and customer expectations for the 2018 bid season.
The company was able to report full quarterly numbers for Knight Transportation, which showed …Read the rest of this story
