Forward Air Corporation Reports Second Quarter 2024 Results
Forward Air (NASDAQ:FWRD) reported financial results for Q2 2024, showing positive momentum despite softness in the freight market. The company's Consolidated EBITDA increased from $55 million in Q1 to $81 million in Q2. Forward Air realized approximately $14 million in cost synergy capture following the Omni transaction, in line with original estimates. The company anticipates reaching full run-rate savings earlier than expected, projecting to operate at full run rate synergy levels by the end of Q1 2025. For 2024, Forward Air expects to deliver Consolidated EBITDA between $310 to $325 million. However, the company faced challenges, reporting a net loss of $966.5 million for the quarter, compared to a net income of $17.1 million in the same period last year.
Forward Air (NASDAQ:FWRD) ha riportato risultati finanziari per il secondo trimestre del 2024, mostrando un buon slancio nonostante la debolezza nel mercato dei trasporti. L'EBITDA consolidato dell'azienda è aumentato da 55 milioni di dollari nel primo trimestre a 81 milioni di dollari nel secondo trimestre. Forward Air ha realizzato circa 14 milioni di dollari in sinergie di costo a seguito della transazione con Omni, in linea con le stime originali. L'azienda prevede di raggiungere il pieno risparmio da sinergie prima del previsto, con l'obiettivo di operare a livelli massimi di sinergia entro la fine del primo trimestre del 2025. Per il 2024, Forward Air prevede di generare un EBITDA consolidato compreso tra 310 e 325 milioni di dollari. Tuttavia, l'azienda ha affrontato delle sfide, riportando una perdita netta di 966,5 milioni di dollari per il trimestre, rispetto a un utile netto di 17,1 milioni di dollari nello stesso periodo dell'anno scorso.
Forward Air (NASDAQ:FWRD) reportó resultados financieros para el segundo trimestre de 2024, mostrando un impulso positivo a pesar de la debilidad en el mercado de carga. El EBITDA consolidado de la compañía aumentó de 55 millones de dólares en el primer trimestre a 81 millones de dólares en el segundo trimestre. Forward Air logró aproximadamente 14 millones de dólares en sinergias de costos tras la transacción con Omni, de acuerdo con las estimaciones originales. La compañía anticipa alcanzar el ahorro por sinergias a plena capacidad antes de lo esperado, proyectando operar a niveles de sinergia plena para finales del primer trimestre de 2025. Para 2024, Forward Air espera entregar un EBITDA consolidado entre 310 y 325 millones de dólares. Sin embargo, la compañía enfrentó desafíos, reportando una pérdida neta de 966.5 millones de dólares en el trimestre, en comparación con una ganancia neta de 17.1 millones de dólares en el mismo período del año pasado.
Forward Air (NASDAQ:FWRD)는 2024년 2분기 재무 결과를 보고하였으며, 화물 시장의 부진에도 불구하고 긍정적인 모멘텀을 보이고 있습니다. 회사의 통합 EBITDA는 1분기 5,500만 달러에서 2분기 8,100만 달러로 증가했습니다. Forward Air는 Omni 거래 이후 약 1,400만 달러의 비용 시너지를 실현했습니다, 이는 원래 예측과 일치합니다. 회사는 예상보다 빠르게 전면적인 절감 효과를 달성할 것으로 기대하고 있으며, 2025년 1분기 말까지 최대 절감 효과를 운영할 것으로 예상하고 있습니다. 2024년 동안 Forward Air는 통합 EBITDA가 3억 1천만 달러에서 3억 2,500만 달러 사이에 이를 것으로 예상합니다. 그러나 회사는 도전을 겪었으며, 분기 동안 순손실이 9억 6,650만 달러에 달해, 지난해 같은 기간에 1,710만 달러의 순이익을 기록했습니다.
Forward Air (NASDAQ:FWRD) a publié ses résultats financiers pour le deuxième trimestre 2024, montrant une dynamique positive malgré la faiblesse du marché du fret. L'EBITDA consolidé de l'entreprise a augmenté de 55 millions de dollars au premier trimestre à 81 millions de dollars au deuxième trimestre. Forward Air a réalisé environ 14 millions de dollars en synergies de coûts suite à la transaction avec Omni, conformément aux estimations initiales. L'entreprise prévoit d'atteindre les économies maximales plus tôt que prévu, en projetant d'opérer à des niveaux de synergies maximales d'ici la fin du premier trimestre 2025. Pour 2024, Forward Air s'attend à fournir un EBITDA consolidé compris entre 310 et 325 millions de dollars. Cependant, l'entreprise a rencontré des défis, déclarant une perte nette de 966,5 millions de dollars pour le trimestre, contre un bénéfice net de 17,1 millions de dollars au cours de la même période l'année dernière.
Forward Air (NASDAQ:FWRD) hat die Finanzergebnisse für das zweite Quartal 2024 veröffentlicht, die eine positive Dynamik trotz der Schwäche auf dem Frachtmarkt zeigen. Das konsolidierte EBITDA des Unternehmens stieg von 55 Millionen Dollar im ersten Quartal auf 81 Millionen Dollar im zweiten Quartal. Forward Air erzielte ungefähr 14 Millionen Dollar an Kostensynergien nach der Omni-Transaktion, was den ursprünglichen Schätzungen entspricht. Das Unternehmen erwartet, dass es die vollen Einsparungen aus Synergien früher als erwartet erreicht und prognostiziert, dass es bis Ende des ersten Quartals 2025 auf vollen Synergieniveaus operiert. Für 2024 erwartet Forward Air, ein konsolidiertes EBITDA zwischen 310 und 325 Millionen Dollar zu liefern. Allerdings hatte das Unternehmen mit Herausforderungen zu kämpfen und berichtete über einen Nettoverlust von 966,5 Millionen Dollar für das Quartal, verglichen mit einem Nettogewinn von 17,1 Millionen Dollar im gleichen Zeitraum des letzten Jahres.
- Consolidated EBITDA increased from $55 million in Q1 to $81 million in Q2 2024
- Realized $14 million in cost synergy capture, in line with original estimates
- Anticipates reaching full run-rate savings earlier than expected
- Projects Consolidated EBITDA between $310 to $325 million for 2024
- Operating revenue increased by 92.9% to $643.7 million
- Reported a net loss of $966.5 million in Q2 2024, compared to a net income of $17.1 million in Q2 2023
- Operating margin decreased from 7.9% to -170.2%
- Cash used in operating activities was $45.2 million, compared to $56.6 million provided in Q2 2023
- Free cash flow decreased to -$59.1 million from $47.7 million in Q2 2023
Insights
Forward Air's Q2 2024 results reveal a mixed financial picture. While operating revenue increased by
The company's Consolidated EBITDA improved from
Investors should note the significant cash burn, with
The freight market's softness is a key challenge for Forward Air, reflecting broader industry trends. However, the company's recent sales wins and focus on synergy capture demonstrate efforts to navigate this environment.
The Omni transaction has expanded Forward Air's service offerings, potentially positioning it for long-term growth. The addition of global freight forwarding and contract logistics services could provide diversification benefits and new revenue streams.
The accelerated synergy capture, with
Forward Air's strategic shift following the Omni transaction marks a significant transformation in its business model. The company is now positioned as a more comprehensive logistics provider, which could enhance its competitive stance in the market.
The appointment of a new CEO and CFO during this critical integration period is noteworthy. Their focus on accelerating synergies and identifying additional cost-saving opportunities beyond initial projections could be important for the company's future performance.
However, the substantial operating loss and negative cash flow highlight the short-term risks of this strategy. The success of this transformation will largely depend on management's ability to execute the integration effectively while navigating challenging market conditions. Investors should closely monitor progress on synergy realization and any improvements in operational efficiency in the coming quarters.
Positive momentum despite softness in freight market
Continues to accelerate integration, synergy capture and cost elimination
Shawn Stewart, Forward’s recently appointed Chief Executive Officer, said, “As a result of the Omni transaction, the combined company now has a unique platform to drive long-term growth through continued best in class domestic expedited and intermodal services and now global freight forwarding and contract logistics services. In our first full quarter as one company, we are beginning to see the power of the combination. We have recently closed several exciting sales wins, and operationally, we are laser-focused on capturing the previously announced synergies as well as other additional cost saving opportunities that were not previously identified. Our achievements in such a short period of time have only added to my confidence in our combined ability to build on the strengths of our legacy companies.”
Mr. Stewart continued, “I am thrilled to have Jamie Pierson on board as our Chief Financial Officer. Jamie has already made a significant impact at the company, especially to our finance organization's processes and reporting capabilities. I look forward to working alongside him as we chart a new course for the Company.”
Mr. Pierson said, “While we continue to face challenging market conditions, we experienced positive momentum as Consolidated EBITDA, a non-GAAP financial measure calculated pursuant to our credit agreement, increased from approximately
Mr. Stewart added, “Obviously, integrations of this size, magnitude and complexity do not progress in a linear fashion, and while the market at large remains uncertain, we believe in the power of the combined company and expect to demonstrate continued improvement in the quarters to come.”
|
|
Three Months Ended |
|||||||||||||
(in thousands, except per share data) |
|
June 30, 2024 |
|
June 30, 2023 |
|
Change |
|
Percent Change |
|||||||
Operating revenue |
|
$ |
643,666 |
|
|
$ |
333,622 |
|
|
$ |
310,044 |
|
|
92.9 |
% |
(Loss) income from operations |
|
$ |
(1,095,755 |
) |
|
$ |
26,325 |
|
|
$ |
(1,122,080 |
) |
|
(4,262.4 |
)% |
Operating margin |
|
|
(170.2 |
)% |
|
|
7.9 |
% |
|
(17,810) bps |
|||||
Net (loss) income |
|
$ |
(966,471 |
) |
|
$ |
17,127 |
|
|
$ |
(983,598 |
) |
|
(5,743.0 |
)% |
Net (loss) income per diluted share |
|
$ |
(23.29 |
) |
|
$ |
0.65 |
|
|
$ |
(23.94 |
) |
|
(3,683.1 |
)% |
Cash (used in) provided by operating activities |
|
$ |
(45,200 |
) |
|
$ |
56,615 |
|
|
$ |
(101,815 |
) |
|
(179.8 |
)% |
|
|
|
|
|
|
|
|
|
|||||||
Non-GAAP Financial Measures: 1 |
|
|
|
|
|
|
|
|
|||||||
Adjusted net income -consolidated EBITDA |
|
$ |
81,325 |
|
|
$ |
101,688 |
|
|
$ |
(20,363 |
) |
|
(20.0 |
)% |
|
|
|
|
|
|
|
|
|
|||||||
Free cash flow |
|
$ |
(59,069 |
) |
|
$ |
47,654 |
|
|
$ |
(106,723 |
) |
|
(224.0 |
)% |
|
|
|
|
|
|
|
|
|
|||||||
1 Reconciliation of these non-GAAP financial measures are provided below the financial tables. |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||
Review of Financial Results
Forward Air will hold a conference call to discuss second quarter 2024 results on Wednesday, August 7, 2024 at 4:30 p.m. ET. The Company's conference call will be available online on the Investor Relations portion of the Company's website at ir.forwardaircorp.com or by dialing (800) 343-4136, Access Code: FWRDQ224.
A replay of the conference call will be available on the Investor Relations portion of the Company’s website at www.forwardaircorp.com, which we use as a primary mechanism to communicate with our investors. Investors are urged to monitor the Investor Relations portion of the Company’s website to easily find or navigate to current and pertinent information about us.
About Forward Air Corporation
Forward Air is a leading asset-light provider of transportation services across
Forward Air Corporation |
|||||||||||||||
Condensed Consolidated Statements of Comprehensive (Loss) Income |
|||||||||||||||
(Unaudited, in thousands, except per share data) |
|||||||||||||||
|
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
June 30, 2024 |
|
June 30, 2023 |
|
June 30, 2024 |
|
June 30, 2023 |
||||||||
Operating revenues: |
|
|
|
|
|
|
|
||||||||
Expedited Freight |
$ |
291,282 |
|
|
$ |
269,436 |
|
|
$ |
564,577 |
|
|
$ |
539,013 |
|
Intermodal |
|
59,299 |
|
|
|
64,251 |
|
|
|
115,591 |
|
|
|
152,420 |
|
Omni Logistics |
|
311,856 |
|
|
|
— |
|
|
|
536,694 |
|
|
|
— |
|
Eliminations and other operations |
|
(18,771 |
) |
|
|
(65 |
) |
|
|
(31,383 |
) |
|
|
(102 |
) |
Operating revenues |
|
643,666 |
|
|
|
333,622 |
|
|
|
1,185,479 |
|
|
|
691,331 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Purchased transportation |
|
321,587 |
|
|
|
141,967 |
|
|
|
598,602 |
|
|
|
287,138 |
|
Salaries, wages and employee benefits |
|
144,000 |
|
|
|
73,963 |
|
|
|
272,867 |
|
|
|
140,610 |
|
Operating leases |
|
46,258 |
|
|
|
22,896 |
|
|
|
85,061 |
|
|
|
46,969 |
|
Depreciation and amortization |
|
48,639 |
|
|
|
13,245 |
|
|
|
80,425 |
|
|
|
25,617 |
|
Insurance and claims |
|
14,698 |
|
|
|
12,761 |
|
|
|
27,579 |
|
|
|
26,019 |
|
Fuel expense |
|
5,859 |
|
|
|
5,202 |
|
|
|
11,105 |
|
|
|
10,888 |
|
Other operating expenses |
|
65,666 |
|
|
|
37,263 |
|
|
|
178,613 |
|
|
|
80,569 |
|
Impairment of goodwill |
|
1,092,714 |
|
|
|
— |
|
|
|
1,092,714 |
|
|
|
— |
|
Total operating expenses |
|
1,739,421 |
|
|
|
307,297 |
|
|
|
2,346,966 |
|
|
|
617,810 |
|
Income (loss) from continuing operations: |
|
|
|
|
|
|
|
||||||||
Expedited Freight |
|
21,946 |
|
|
|
27,063 |
|
|
|
41,444 |
|
|
|
56,748 |
|
Intermodal |
|
5,317 |
|
|
|
4,312 |
|
|
|
8,903 |
|
|
|
15,515 |
|
Omni Logistics |
|
(1,105,871 |
) |
|
|
— |
|
|
|
(1,134,456 |
) |
|
|
— |
|
Other Operations |
|
(17,147 |
) |
|
|
(5,050 |
) |
|
|
(77,378 |
) |
|
|
1,258 |
|
(Loss) income from continuing operations |
|
(1,095,755 |
) |
|
|
26,325 |
|
|
|
(1,161,487 |
) |
|
|
73,521 |
|
Other expense: |
|
|
|
|
|
|
|
||||||||
Interest expense, net |
|
(47,265 |
) |
|
|
(2,585 |
) |
|
|
(88,018 |
) |
|
|
(4,940 |
) |
Foreign exchange gain |
|
1,567 |
|
|
|
— |
|
|
|
899 |
|
|
|
— |
|
Other income, net |
|
40 |
|
|
|
— |
|
|
|
49 |
|
|
|
— |
|
Total other expense |
|
(45,658 |
) |
|
|
(2,585 |
) |
|
|
(87,070 |
) |
|
|
(4,940 |
) |
(Loss) income before income taxes |
|
(1,141,413 |
) |
|
|
23,740 |
|
|
|
(1,248,557 |
) |
|
|
68,581 |
|
Income tax (benefit) expense |
|
(174,942 |
) |
|
|
6,613 |
|
|
|
(193,292 |
) |
|
|
17,550 |
|
Net (loss) income from continuing operations |
|
(966,471 |
) |
|
|
17,127 |
|
|
|
(1,055,265 |
) |
|
|
51,031 |
|
(Loss) income from discontinued operation, net of tax |
|
(4,876 |
) |
|
|
2,824 |
|
|
|
(4,876 |
) |
|
|
5,288 |
|
Net (loss) income |
|
(971,347 |
) |
|
|
19,951 |
|
|
$ |
(1,060,141 |
) |
|
$ |
56,319 |
|
Net (loss) attributable to noncontrolling interest |
|
(325,914 |
) |
|
|
— |
|
|
|
(352,996 |
) |
|
|
— |
|
Net (loss) income attributable to Forward Air |
$ |
(645,433 |
) |
|
$ |
19,951 |
|
|
$ |
(707,145 |
) |
|
$ |
56,319 |
|
|
|
|
|
|
|
|
|
||||||||
Net income per common share: |
|
|
|
|
|
|
|
||||||||
Basic net (loss) income per share |
|
|
|
|
|
|
|
||||||||
Continuing operations |
$ |
(23.29 |
) |
|
$ |
0.65 |
|
|
$ |
(27.53 |
) |
|
$ |
1.94 |
|
Discontinued operation |
|
(0.18 |
) |
|
|
0.11 |
|
|
|
(0.18 |
) |
|
|
0.20 |
|
Basic |
$ |
(23.47 |
) |
|
$ |
0.76 |
|
|
$ |
(27.71 |
) |
|
$ |
2.14 |
|
|
|
|
|
|
|
|
|
||||||||
Diluted net (loss) income per share |
|
|
|
|
|
|
|
||||||||
Continuing operations |
$ |
(23.29 |
) |
|
$ |
0.65 |
|
|
$ |
(27.53 |
) |
|
$ |
1.93 |
|
Discontinued operation |
|
(0.18 |
) |
|
|
0.11 |
|
|
|
(0.18 |
) |
|
|
0.20 |
|
Diluted |
$ |
(23.47 |
) |
|
$ |
0.76 |
|
|
$ |
(27.71 |
) |
|
$ |
2.13 |
|
|
|
|
|
|
|
|
|
||||||||
Dividends per share: |
$ |
— |
|
|
$ |
0.24 |
|
|
$ |
— |
|
|
$ |
0.48 |
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income |
$ |
(971,347 |
) |
|
$ |
19,951 |
|
|
$ |
(1,060,141 |
) |
|
$ |
56,319 |
|
Other comprehensive (loss) income: |
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments |
|
(849 |
) |
|
|
— |
|
|
|
(1,000 |
) |
|
|
— |
|
Comprehensive (loss) income |
$ |
(972,196 |
) |
|
$ |
19,951 |
|
|
$ |
(1,059,141 |
) |
|
$ |
56,319 |
|
Expedited Freight Segment Information |
||||||||||||||||||
(In thousands) |
||||||||||||||||||
(Unaudited) |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Three Months Ended |
|||||||||||||||||
|
June 30, 2024 |
|
Percent of Revenue |
|
June 30, 2023 |
|
Percent of Revenue |
|
Change |
|
Percent Change |
|||||||
Operating revenues: |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Network 1 |
$ |
223,334 |
|
76.7 |
% |
|
$ |
205,762 |
|
76.4 |
% |
|
$ |
17,572 |
|
|
8.5 |
% |
Truckload |
|
44,678 |
|
15.3 |
|
|
|
40,432 |
|
15.0 |
|
|
|
4,246 |
|
|
10.5 |
|
Other |
|
23,270 |
|
8.0 |
|
|
|
23,242 |
|
8.6 |
|
|
|
28 |
|
|
0.1 |
|
Total operating revenues |
|
291,282 |
|
100.0 |
|
|
|
269,436 |
|
100.0 |
|
|
|
21,846 |
|
|
8.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Purchased transportation |
|
142,512 |
|
48.9 |
|
|
|
124,122 |
|
46.1 |
|
|
|
18,390 |
|
|
14.8 |
|
Salaries, wages and employee benefits |
|
63,845 |
|
21.9 |
|
|
|
57,637 |
|
21.4 |
|
|
|
6,208 |
|
|
10.8 |
|
Operating leases |
|
14,730 |
|
5.1 |
|
|
|
16,201 |
|
6.0 |
|
|
|
(1,471 |
) |
|
(9.1 |
) |
Depreciation and amortization |
|
10,692 |
|
3.7 |
|
|
|
8,439 |
|
3.1 |
|
|
|
2,253 |
|
|
26.7 |
|
Insurance and claims |
|
10,969 |
|
3.8 |
|
|
|
10,104 |
|
3.8 |
|
|
|
865 |
|
|
8.6 |
|
Fuel expense |
|
2,434 |
|
0.8 |
|
|
|
2,511 |
|
0.9 |
|
|
|
(77 |
) |
|
(3.1 |
) |
Other operating expenses |
|
24,154 |
|
8.3 |
|
|
|
23,359 |
|
8.7 |
|
|
|
795 |
|
|
3.4 |
|
Total operating expenses |
|
269,336 |
|
92.5 |
|
|
|
242,373 |
|
90.0 |
|
|
|
26,963 |
|
|
11.1 |
|
Income from operations |
$ |
21,946 |
|
7.5 |
% |
|
$ |
27,063 |
|
10.0 |
% |
|
$ |
(5,117 |
) |
|
(18.9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
1 Network revenue is comprised of all revenue, including linehaul, pickup and/or delivery, and fuel surcharge revenue, excluding accessorial and Truckload revenue. |
||||||||||||||||||
Expedited Freight Operating Statistics |
||||||||
|
|
|||||||
|
Three Months Ended |
|||||||
|
June 30, 2024 |
|
June 30, 2023 |
|
Percent Change |
|||
|
|
|
|
|
|
|||
Business days |
|
64 |
|
|
64 |
|
— |
% |
|
|
|
|
|
|
|||
Tonnage 1,2 |
|
|
|
|
|
|||
Total pounds |
|
713,919 |
|
|
673,878 |
|
5.9 |
|
Pounds per day |
|
11,155 |
|
|
10,529 |
|
5.9 |
|
|
|
|
|
|
|
|||
Shipments 1,2 |
|
|
|
|
|
|||
Total shipments |
|
870 |
|
|
842 |
|
1.4 |
|
Shipments per day |
|
13.6 |
|
|
13.2 |
|
1.4 |
|
|
|
|
|
|
|
|||
Weight per shipment |
|
821 |
|
|
801 |
|
2.5 |
|
|
|
|
|
|
|
|||
Revenue per hundredweight 3 |
$ |
31.29 |
|
$ |
30.79 |
|
1.6 |
|
Revenue per hundredweight, ex fuel 3 |
$ |
24.38 |
|
$ |
24.08 |
|
1.2 |
|
|
|
|
|
|
|
|||
Revenue per shipment 3 |
$ |
256.80 |
|
$ |
246.59 |
|
4.1 |
|
Revenue per shipment, ex fuel 3 |
$ |
200.05 |
|
$ |
192.85 |
|
3.7 |
|
|
|
|
|
|
|
|||
1 In thousands |
||||||||
2 Excludes accessorial and Truckload and products |
||||||||
3 Includes intercompany revenue between the Network and Truckload revenue streams |
||||||||
Intermodal Segment Information |
||||||||||||||||||
(In thousands) |
||||||||||||||||||
(Unaudited) |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Three Months Ended |
|||||||||||||||||
|
June 30, 2024 |
|
Percent of Revenue |
|
June 30, 2023 |
|
Percent of Revenue |
|
Change |
|
Percent Change |
|||||||
Operating revenue |
$ |
59,299 |
|
100.0 |
% |
|
$ |
64,251 |
|
100.0 |
% |
|
$ |
(4,952 |
) |
|
(7.7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Purchased transportation |
|
19,173 |
|
32.3 |
|
|
|
17,909 |
|
27.9 |
|
|
|
1,264 |
|
|
7.1 |
|
Salaries, wages and employee benefits |
|
14,899 |
|
25.1 |
|
|
|
16,650 |
|
25.9 |
|
|
|
(1,751 |
) |
|
(10.5 |
) |
Operating leases |
|
4,776 |
|
8.1 |
|
|
|
6,695 |
|
10.4 |
|
|
|
(1,919 |
) |
|
(28.7 |
) |
Depreciation and amortization |
|
4,712 |
|
7.9 |
|
|
|
4,806 |
|
7.5 |
|
|
|
(94 |
) |
|
(2.0 |
) |
Insurance and claims |
|
2,619 |
|
4.4 |
|
|
|
2,815 |
|
4.4 |
|
|
|
(196 |
) |
|
(7.0 |
) |
Fuel expense |
|
2,243 |
|
3.8 |
|
|
|
2,692 |
|
4.2 |
|
|
|
(449 |
) |
|
(16.7 |
) |
Other operating expenses |
|
5,560 |
|
9.4 |
|
|
|
8,372 |
|
13.0 |
|
|
|
(2,812 |
) |
|
(33.6 |
) |
Total operating expenses |
|
53,982 |
|
91.0 |
|
|
|
59,939 |
|
93.3 |
|
|
|
(5,957 |
) |
|
(9.9 |
) |
Income from operations |
$ |
5,317 |
|
9.0 |
% |
|
$ |
4,312 |
|
6.7 |
% |
|
$ |
1,005 |
|
|
23.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Intermodal Operating Statistics |
||||||||
|
|
|||||||
|
Three Months Ended |
|||||||
|
June 30, 2024 |
|
June 30, 2023 |
|
Percent Change |
|||
Drayage shipments |
|
64,877 |
|
|
68,180 |
|
(4.8 |
)% |
Drayage revenue per shipment |
$ |
826 |
|
$ |
853 |
|
(3.2 |
)% |
Omni Logistics Segment Information |
||||||
(In thousands) |
||||||
(Unaudited) |
||||||
|
|
|
|
|||
|
Three Months Ended |
|||||
|
June 30, 2024 |
|
Percent of Revenue |
|||
Operating revenue |
$ |
311,856 |
|
|
100.0 |
% |
|
|
|
|
|||
Operating expenses: |
|
|
|
|||
Purchased transportation |
|
178,674 |
|
|
57.3 |
|
Salaries, wages and employee benefits |
|
57,536 |
|
|
18.4 |
|
Operating leases |
|
26,751 |
|
|
8.6 |
|
Depreciation and amortization |
|
33,235 |
|
|
10.7 |
|
Insurance and claims |
|
2,845 |
|
|
0.9 |
|
Fuel expense |
|
1,182 |
|
|
0.4 |
|
Other operating expenses |
|
24,790 |
|
|
7.9 |
|
Impairment of goodwill |
|
1,092,714 |
|
|
350.4 |
|
Total operating expenses |
|
1,417,727 |
|
|
454.6 |
|
Loss from operations |
$ |
(1,105,871 |
) |
|
(354.6 |
)% |
|
|
|
|
|||
Forward Air Corporation |
||||||
Condensed Consolidated Balance Sheets |
||||||
(In thousands) |
||||||
(Unaudited) |
||||||
|
June 30, 2024 |
|
December 31, 2023 |
|||
Assets |
|
|
|
|||
Current assets: |
|
|
|
|||
Cash and cash equivalents |
$ |
84,886 |
|
|
$ |
121,969 |
Restricted cash and restricted cash equivalents |
|
19,769 |
|
|
|
39,604 |
Accounts receivable, net |
|
368,927 |
|
|
|
153,267 |
Other receivables |
|
1,476 |
|
|
|
5,408 |
Prepaid expenses |
|
39,186 |
|
|
|
25,682 |
Other current assets |
|
44,379 |
|
|
|
1,098 |
Total current assets |
|
558,623 |
|
|
|
347,028 |
|
|
|
|
|||
Noncurrent restricted cash equivalents |
|
— |
|
|
|
1,790,500 |
Property and equipment |
|
607,961 |
|
|
|
508,280 |
Less accumulated depreciation and amortization |
|
279,027 |
|
|
|
250,185 |
Property and equipment, net |
|
328,934 |
|
|
|
258,095 |
Operating lease right-of-use assets |
|
323,821 |
|
|
|
111,552 |
Goodwill |
|
545,380 |
|
|
|
278,706 |
Other acquired intangibles, net |
|
1,230,699 |
|
|
|
134,789 |
Other assets |
|
79,859 |
|
|
|
58,863 |
Total assets |
$ |
3,067,316 |
|
|
$ |
2,979,533 |
|
|
|
|
|||
Liabilities and Shareholders' Equity |
|
|
|
|||
Current liabilities: |
|
|
|
|||
Accounts payable |
$ |
143,455 |
|
|
$ |
45,430 |
Accrued expenses |
|
117,431 |
|
|
|
62,948 |
Other current liabilities |
|
53,064 |
|
|
|
71,727 |
Current portion of debt and finance lease obligations |
|
16,875 |
|
|
|
12,645 |
Current portion of operating lease liabilities |
|
89,188 |
|
|
|
44,344 |
Total current liabilities |
|
420,013 |
|
|
|
237,094 |
|
|
|
|
|||
Finance lease obligations, less current portion |
|
34,957 |
|
|
|
26,736 |
Long-term debt, less current portion |
|
1,677,315 |
|
|
|
— |
Long-term debt held in escrow |
|
— |
|
|
|
1,790,500 |
Operating lease liabilities, less current portion |
|
243,217 |
|
|
|
71,598 |
Liabilities under tax receivable agreement |
|
13,270 |
|
|
|
— |
Other long-term liabilities |
|
43,126 |
|
|
|
47,144 |
Deferred income taxes |
|
271,201 |
|
|
|
42,200 |
|
|
|
|
|||
Shareholders' equity: |
|
|
|
|||
Preferred stock |
|
— |
|
|
|
— |
Common stock |
|
277 |
|
|
|
257 |
Additional paid-in capital |
|
512,638 |
|
|
|
283,684 |
Retained earnings |
|
(228,151 |
) |
|
|
480,320 |
Accumulated other comprehensive loss |
|
(1,000 |
) |
|
|
— |
Total Forward Air shareholders' equity |
|
283,764 |
|
|
|
764,261 |
Noncontrolling interest |
|
80,453 |
|
|
|
— |
Total shareholders' equity |
|
364,217 |
|
|
|
764,261 |
Total liabilities and shareholders' equity |
$ |
3,067,316 |
|
|
$ |
2,979,533 |
Forward Air Corporation |
|||||||
Condensed Consolidated Statements of Cash Flows |
|||||||
(In thousands) |
|||||||
(Unaudited) |
|||||||
|
Three Months Ended |
||||||
|
June 30, 2024 |
|
June 30, 2023 |
||||
Operating activities: |
|
|
|
||||
Net (loss) income from continuing operations |
$ |
(966,471 |
) |
|
$ |
17,127 |
|
Adjustments to reconcile net (loss) income of continuing operations to net cash (used in) provided by operating activities of continuing operations |
|
|
|
||||
Depreciation and amortization |
|
48,639 |
|
|
|
13,244 |
|
Impairment of goodwill |
|
1,092,714 |
|
|
|
— |
|
Share-based compensation expense |
|
3,620 |
|
|
|
2,890 |
|
Provision for revenue adjustments |
|
1,121 |
|
|
|
1,714 |
|
Deferred income tax (benefit) expense |
|
(166,549 |
) |
|
|
325 |
|
Other |
|
2,300 |
|
|
|
(642 |
) |
Changes in operating assets and liabilities, net of effects from the purchase of acquired businesses: |
|
|
|
||||
Accounts receivable |
|
(21,770 |
) |
|
|
22,293 |
|
Other receivables |
|
164 |
|
|
|
— |
|
Other current and noncurrent assets |
|
(49,528 |
) |
|
|
(300 |
) |
Accounts payable and accrued expenses |
|
10,560 |
|
|
|
(36 |
) |
Net cash (used in) provided by operating activities of continuing operations |
|
(45,200 |
) |
|
|
56,615 |
|
|
|
|
|
||||
Investing activities: |
|
|
|
||||
Proceeds from sale of property and equipment |
|
557 |
|
|
|
1,356 |
|
Purchases of property and equipment |
|
(14,426 |
) |
|
|
(10,317 |
) |
Purchases of a business, net of cash acquired |
|
— |
|
|
|
(136 |
) |
Other |
|
(85 |
) |
|
|
— |
|
Net cash used in investing activities of continuing operations |
|
(13,954 |
) |
|
|
(9,097 |
) |
|
|
|
|
||||
Financing activities: |
|
|
|
||||
Repayments of finance lease obligations |
|
(4,567 |
) |
|
|
(1,837 |
) |
Payments on credit facility |
|
— |
|
|
|
(30,750 |
) |
Payments of dividends to shareholders |
|
— |
|
|
|
(6,255 |
) |
Repurchases and retirement of common stock |
|
— |
|
|
|
(25,009 |
) |
Proceeds from common stock issued under employee stock purchase plan |
|
369 |
|
|
|
421 |
|
Payment of minimum tax withholdings on share-based awards |
|
(33 |
) |
|
|
(4,292 |
) |
Contributions from subsidiary held for sale |
|
— |
|
|
|
6,457 |
|
Net cash used in financing activities of continuing operations |
|
(4,231 |
) |
|
|
(61,265 |
) |
Effect of exchange rate changes on cash |
|
646 |
|
|
|
— |
|
Net decrease in cash, cash equivalents, restricted cash, and restricted cash equivalents from continuing operations |
|
(62,739 |
) |
|
|
(13,747 |
) |
|
|
|
|
||||
Cash from discontinued operation: |
|
|
|
||||
Net cash (used in) provided by operating activities of discontinued operation |
|
(4,876 |
) |
|
|
6,958 |
|
Net cash used in investing activities of discontinued operation |
|
— |
|
|
|
(469 |
) |
Net cash used in financing activities of discontinued operation |
|
— |
|
|
|
(6,489 |
) |
Net decrease in cash, cash equivalents, restricted cash and restricted cash equivalents |
|
(67,615 |
) |
|
|
(13,747 |
) |
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period of continuing operations |
|
172,270 |
|
|
|
32,028 |
|
Cash at beginning of period of discontinued operation |
|
— |
|
|
|
— |
|
Net decrease in cash, cash equivalents, restricted cash and restricted cash equivalents |
|
(67,615 |
) |
|
|
(13,747 |
) |
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period of continuing operations |
$ |
104,655 |
|
|
$ |
18,281 |
|
|
|
|
|
||||
Forward Air Corporation |
|||||||
Condensed Consolidated Statements of Cash Flows |
|||||||
(In thousands) |
|||||||
(Unaudited) |
|||||||
|
Six Months Ended |
||||||
|
June 30, 2024 |
|
June 30, 2023 |
||||
Operating activities: |
|
|
|
||||
Net (loss) income from operations |
$ |
(1,055,265 |
) |
|
$ |
51,031 |
|
Adjustments to reconcile net income of operations to net cash provided by operating activities of operations |
|
|
|
||||
Depreciation and amortization |
|
80,425 |
|
|
|
25,617 |
|
Impairment of goodwill |
|
1,092,714 |
|
|
|
— |
|
Share-based compensation expense |
|
5,187 |
|
|
|
5,796 |
|
Provision for revenue adjustments |
|
2,159 |
|
|
|
2,812 |
|
Deferred income tax (benefit) expense |
|
(163,604 |
) |
|
|
2,182 |
|
Other |
|
6,469 |
|
|
|
(1,733 |
) |
Changes in operating assets and liabilities, net of effects from the purchase of acquired businesses: |
|
|
|
||||
Accounts receivable |
|
(42,265 |
) |
|
|
38,690 |
|
Other receivables |
|
5,531 |
|
|
|
— |
|
Other current and noncurrent assets |
|
(56,637 |
) |
|
|
10,609 |
|
Accounts payable and accrued expenses |
|
28,362 |
|
|
|
(17,550 |
) |
Net cash provided by operating activities |
|
(96,924 |
) |
|
|
117,454 |
|
|
|
|
|
||||
Investing activities: |
|
|
|
||||
Proceeds from sale of property and equipment |
|
1,406 |
|
|
|
3,171 |
|
Purchases of property and equipment |
|
(19,396 |
) |
|
|
(16,836 |
) |
Purchase of a business, net of cash acquired |
|
(1,565,242 |
) |
|
|
(56,703 |
) |
Other |
|
(174 |
) |
|
|
— |
|
Net cash used in investing activities |
|
(1,583,406 |
) |
|
|
(70,368 |
) |
|
|
|
|
||||
Financing activities: |
|
|
|
||||
Repayments of finance lease obligations |
|
(9,127 |
) |
|
|
(3,923 |
) |
Proceeds from credit facility |
|
— |
|
|
|
45,000 |
|
Payments on credit facility |
|
(80,000 |
) |
|
|
(30,750 |
) |
Payment of debt issuance costs |
|
(60,591 |
) |
|
|
— |
|
Payment of earn-out liability |
|
(12,247 |
) |
|
|
— |
|
Payments of dividends to shareholders |
|
— |
|
|
|
(12,600 |
) |
Repurchases and retirement of common stock |
|
— |
|
|
|
(79,792 |
) |
Proceeds from common stock issued under employee stock purchase plan |
|
369 |
|
|
|
421 |
|
Payment of minimum tax withholdings on share-based awards |
|
(1,361 |
) |
|
|
(4,292 |
) |
Contributions from (distributions to) subsidiary held for sale |
|
— |
|
|
|
11,309 |
|
Net cash used in financing activities |
|
(162,957 |
) |
|
|
(74,627 |
) |
Effect of exchange rate changes on cash |
|
745 |
|
|
|
— |
|
Net (decrease) increase in cash and cash equivalents |
|
(1,842,542 |
) |
|
|
(27,541 |
) |
|
|
|
|
||||
|
|
|
|
||||
Cash from discontinued operation: |
|
|
|
||||
Net cash used in operating activities of discontinued operation |
|
(4,876 |
) |
|
|
12,112 |
|
Net cash provided by (used in) investing activities of discontinued operation |
|
— |
|
|
|
(739 |
) |
Net cash (used in) provided by financing activities of discontinued operation |
|
— |
|
|
|
(11,373 |
) |
Net increase (decrease) in cash and cash equivalents |
|
(1,847,418 |
) |
|
|
(27,541 |
) |
Cash and cash equivalents at beginning of period |
|
1,952,073 |
|
|
|
45,822 |
|
Cash and cash equivalents at end of period |
$ |
104,655 |
|
|
$ |
18,281 |
|
Forward Air Corporation Reconciliation of Non-GAAP Financial Measures
In this press release, the Company includes financial measures that are derived on the basis of methodologies other than in accordance with accounting principles generally accepted in
For the three months ended June 30, 2024 and 2023, this press release contains the following non-GAAP financial measures: earnings before interest, taxes, depreciation and amortization (“EBITDA”), and free cash flow.
All non-GAAP financial measures are presented on a continuing operations basis.
The Company believes that EBITDA improves comparability from period to period by removing the impact of its capital structure (interest and financing expenses), asset base (depreciation and amortization) and tax impacts. The Company believes that free cash flow is an important measure of its ability to repay maturing debt or fund other uses of capital that it believes will enhance shareholder value.
The Company is also providing Consolidated EBITDA calculated in accordance with our credit agreement as we believe it provides investors with important information regarding our financial condition and compliance with our obligations under our credit agreement.
Non-GAAP financial measures should be viewed in addition to, and not as an alternative to or substitute for, the Company’s financial results prepared in accordance with GAAP. The Company has included, for the periods indicated, a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure. Investors and other readers are encouraged to review the related
With respect to the 2024 Consolidated EBITDA guidance, please note that the Company is not providing a quantitative reconciliation of Consolidated EBITDA to Net Income because it is not available without unreasonable efforts. The Company does not currently have sufficient data to accurately estimate the variables and individual adjustments for such reconciliation, or to quantify the probable significance of these items. The adjustments required for any such reconciliation of the Company’s forward-looking non-GAAP financial measures cannot be accurately forecast by the Company, and therefore the reconciliation has been omitted.
The following is a reconciliation of net income to Consolidated EBITDA for the three and six months ended June 30, 2024 and 2023 (in thousands):
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||
|
|
June 30, 2024 |
|
June 30, 2023 |
|
June 30, 2024 |
|
June 30, 2023 |
||||||
Net (loss) income |
|
$ |
(966,471 |
) |
|
$ |
17,127 |
|
$ |
(1,055,265 |
) |
|
$ |
51,031 |
Interest expense |
|
|
47,265 |
|
|
|
2,585 |
|
|
88,018 |
|
|
|
4,940 |
Income tax (benefit) expense |
|
|
(174,942 |
) |
|
|
6,613 |
|
|
(193,292 |
) |
|
|
17,550 |
Depreciation and amortization |
|
|
48,639 |
|
|
|
13,245 |
|
|
80,425 |
|
|
|
25,617 |
Reported EBITDA |
|
|
(1,045,509 |
) |
|
|
39,570 |
|
|
(1,080,114 |
) |
|
|
99,138 |
Impairment of goodwill |
|
|
1,092,714 |
|
|
|
— |
|
|
1,092,714 |
|
|
|
— |
Transaction and integration costs |
|
|
10,018 |
|
|
|
5,500 |
|
|
71,942 |
|
|
|
5,500 |
Severance costs |
|
|
4,029 |
|
|
|
113 |
|
|
11,585 |
|
|
|
161 |
Cost synergies |
|
|
5,747 |
|
|
|
— |
|
|
16,254 |
|
|
|
— |
RIF cost savings |
|
|
4,878 |
|
|
|
5,280 |
|
|
10,576 |
|
|
|
10,366 |
Other |
|
|
9,448 |
|
|
|
2,353 |
|
|
12,926 |
|
|
|
4,115 |
Pro forma -Omni adjusted EBITDA |
|
|
— |
|
|
|
48,872 |
|
|
— |
|
|
|
93,290 |
Consolidated EBITDA |
|
$ |
81,325 |
|
|
$ |
101,688 |
|
$ |
135,883 |
|
|
$ |
212,570 |
|
|
|
|
|||||||||||
The following is a reconciliation of net cash provided by operating activities to free cash flow for the three and six months ended June 30, 2024 and 2023 (in thousands):
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
June 30, 2024 |
|
June 30, 2023 |
|
June 30, 2024 |
|
June 30, 2023 |
||||||||
Net cash (used in) provided by operating activities of continuing operations |
|
$ |
(45,200 |
) |
|
$ |
56,615 |
|
|
$ |
(96,924 |
) |
|
$ |
117,454 |
|
Proceeds from sale of property and equipment |
|
|
557 |
|
|
|
1,356 |
|
|
|
1,406 |
|
|
|
3,171 |
|
Purchases of property and equipment |
|
|
(14,426 |
) |
|
|
(10,317 |
) |
|
|
(19,396 |
) |
|
|
(16,836 |
) |
Free cash flow |
|
$ |
(59,069 |
) |
|
$ |
47,654 |
|
|
$ |
(114,914 |
) |
|
$ |
103,789 |
|
Note Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. The following is a list of factors, among others, that could cause actual results to differ materially from those contemplated by the forward-looking statements: economic factors such as recessions, inflation, higher interest rates and downturns in customer business cycles, the Company's ability to achieve the expected strategic, financial and other benefits of the acquisition of Omni Logistics, including the realization of expected synergies and the achievement of deleveraging targets within the expected timeframes or at all, the risk that the businesses will not be integrated successfully or that integration may be more difficult, time-consuming or costly than expected, the risk that operating costs, customer loss, management and employee retention and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) as a result of the acquisition of Omni Logistics may be greater than expected, continued weakening of the freight environment, future debt and financing levels, our ability to deleverage, including, without limitation, through capital allocation or divestitures of non-core businesses, our ability to secure terminal facilities in desirable locations at reasonable rates, more limited liquidity than expected which limits our ability to make key investments, the creditworthiness of our customers and their ability to pay for services rendered, our inability to maintain our historical growth rate because of a decreased volume of freight or decreased average revenue per pound of freight moving through our network, the availability and compensation of qualified Leased Capacity Providers and freight handlers as well as contracted, third-party carriers needed to serve our customers’ transportation needs, our inability to manage our information systems and inability of our information systems to handle an increased volume of freight moving through our network, the occurrence of cybersecurity risks and events, market acceptance of our service offerings, claims for property damage, personal injuries or workers’ compensation, enforcement of and changes in governmental regulations, environmental, tax, insurance and accounting matters, the handling of hazardous materials, changes in fuel prices, loss of a major customer, increasing competition, and pricing pressure, our dependence on our senior management team and the potential effects of changes in employee status, seasonal trends, the occurrence of certain weather events, restrictions in our charter and bylaws and the risks described in our Annual Report on Form 10-K for the year ended December 31, 2023, and as may be identified in our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
We caution readers that any forward-looking statement made by us in this press release is based only on information currently available to us and they should not place undue reliance on these forward-looking statements, which reflect management's opinion as of the date on which it is made. We undertake no obligation to publicly update any forward- looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise unless required by law.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240807439096/en/
Investors:
Tony Carreño
investorrelations@forwardair.com
Media:
Justin Moss
(404) 362-8933
jmoss@forwardair.com
Source: Forward Air Corporation
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