Core Insights - Forward Air (FWRD) reported a quarterly loss of $0.52 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.13, marking an earnings surprise of -300.00% [1] - The company's revenues for the quarter ended September 2025 were $631.76 million, missing the Zacks Consensus Estimate by 1.98% and down from $655.94 million a year ago [2] - Forward Air shares have declined approximately 43.8% year-to-date, contrasting with the S&P 500's gain of 15.1% [3] Financial Performance - Over the last four quarters, Forward Air has only surpassed consensus EPS estimates once [2] - The current consensus EPS estimate for the upcoming quarter is -$0.20 on revenues of $640.85 million, and for the current fiscal year, it is -$1.40 on revenues of $2.52 billion [7] Industry Outlook - The Transportation - Truck industry, to which Forward Air belongs, is currently ranked in the bottom 5% of over 250 Zacks industries, indicating a challenging environment [8] - Empirical research suggests that the performance of stocks is closely tied to trends in earnings estimate revisions, with the current unfavorable trend resulting in a Zacks Rank 4 (Sell) for Forward Air [5][6]

Financial Data and Key Metrics Changes - The company reported consolidated EBITDA of $78 million for the third quarter of 2025, consistent with the $77 million reported in the second quarter of 2025 [12] - Adjusted EBITDA was $75 million, compared to $74 million in the second quarter of 2025 and $76 million in the third quarter of 2024 [14] - Cash provided by operations increased to $53 million in the third quarter of 2025, up from $51 million in the same quarter last year [18] Business Line Data and Key Metrics Changes - The Expedited Freight segment reported EBITDA of $30 million with a margin of 11.5%, maintaining the same EBITDA as the previous quarter but showing an improvement in margin from 10.4% a year ago [15] - The Omni Logistics segment achieved revenue of $340 million and reported EBITDA of $33 million, a 22% increase from $27 million in the third quarter of 2024 [16] - The Intermodal segment reported EBITDA of $8 million, consistent with the previous quarter and the same quarter last year [17] Market Data and Key Metrics Changes - The company noted a decline in tonnage but improved pricing programs and managed discretionary expenses effectively [15] - The overall freight environment remains challenging, with the company focusing on maintaining the right freight mix at optimal prices [15] Company Strategy and Development Direction - The company is undergoing a strategic alternatives review process, exploring potential sales, mergers, or other transactions to maximize long-term value [6][8] - The transformation plan aims to unify operations under a new regional structure, creating the OneGround network to enhance efficiency and collaboration [10][11] - The company is rationalizing its technology stack to improve efficiencies and drive cost savings [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism that market conditions will eventually rebound, emphasizing the importance of maintaining momentum in their progress [13] - The company remains focused on delivering industry-leading service quality while managing costs prudently [13] - Management highlighted the strength of the team and the solid foundation built for sustainable long-term growth despite macroeconomic uncertainties [23] Other Important Information - The company reported a total liquidity of $413 million at the end of the third quarter, an increase from $368 million at the end of the second quarter [19] - The credit agreement allows for the inclusion of unrealized and proforma savings in historical consolidated EBITDA, which has been adjusted for prior quarters [18] Q&A Session Summary Question: Update on Omni business and long-term margin targets - Management noted that the Omni business has shown stability in EBITDA margins, but optimal margins are currently suppressed due to the overall market conditions [26][28] Question: Commentary on seasonality in the business - Management indicated that the Omni segment is not expected to be highly seasonal due to the stability of the warehouse side of the business [32][34] Question: Update on LTL segment and cost realignment - Management emphasized that the company operates a variable-cost network, allowing for flexibility in adjusting costs based on volume [40][42] Question: Clarification on the strategic alternatives review process - Management reiterated that the review process is ongoing and that they will provide updates when appropriate [46][52] Question: Insights on cash flow and debt payments - Management explained that cash flow management is crucial, especially around semiannual debt payments, and they aim to generate more cash in the quarters leading up to those payments [56][58] Question: Benefits of the combined company and operational synergies - Management confirmed that the combination of the companies has been beneficial, allowing for growth and operational efficiency across segments [63][67]

Forward Air Corporation Earnings Presentation 3Q25 November 5, 2025 Earnings Presentation Statements & Disclaimers Forward Looking Statements This presentation contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," ...

Business Operations - The company operates as a leading asset-light freight provider, focusing on transportation services including LTL, truckload, and intermodal drayage across the U.S., Canada, and Mexico [92]. - The company monitors key operating statistics such as tonnage, weight per shipment, revenue per hundredweight, and average length of haul to evaluate performance in its Expedited Freight and Intermodal segments [99][105]. - The company is actively monitoring macroeconomic conditions, including proposed tariffs on imported goods, which may impact freight demand and overall business performance [108]. - The company continues to focus on creating synergies across its services, particularly within the Expedited Freight segment, to enhance operational efficiency [96]. - The company is implementing a transformation of the combined business post-acquisition to maximize revenues and efficiencies while retaining existing customers [110]. Financial Performance - Estimated revenue for key product groups for the period ended December 31, 2024, approximated 70% for ground transportation, 12% for air & ocean forwarding, 9% for intermodal drayage, and 9% for warehousing/value-added services [98]. - Operating revenues decreased by $24,174, or 3.7%, to $631,763 for the three months ended September 30, 2025, compared to $655,937 for the same period in 2024 [115]. - Income from continuing operations decreased by $7,690, or 33.9%, to $15,007 for the three months ended September 30, 2025, attributed to lower operating revenues and increased acquisition expenses [117]. - Net loss decreased by $11,578, to $23,757 for the three months ended September 30, 2025, compared to a net loss of $35,335 for the same period in 2024 [120]. - Operating revenues increased by $22,472, or 1.2%, to $1,863,888 for the nine months ended September 30, 2025, compared to $1,841,416 for the same period in 2024 [146]. - Net loss decreased by $990,164, or 90.4%, to $105,312 for the nine months ended September 30, 2025, compared to a net loss of $1,095,476 for the same period in 2024 [151]. Expenses and Cost Management - Operating expenses decreased by $16,484, or 2.6%, to $616,756 for the three months ended September 30, 2025, mainly due to lower shipment volumes and a prior year goodwill impairment charge of $14,751 [116]. - Total other expenses decreased by $17,214, or 31.0%, to $38,379 for the three months ended September 30, 2025, due to lower net interest expenses and adjustments to tax liabilities [118]. - Purchased transportation costs decreased by $14,770, or 10.5%, to $125,265 for the three months ended September 30, 2025, representing 48.4% of Expedited Freight operating revenues [126]. - Salaries, wages, and employee benefits decreased by $5,023, or 8.5%, to $54,403 for the three months ended September 30, 2025, accounting for 21.0% of Expedited Freight operating revenues [127]. - Other operating expenses decreased by $5,241, or 20.0%, to $20,914 for the three months ended September 30, 2025, reflecting acquisition integration synergies and reduced shipments [128]. - Operating expenses decreased by $1,155,611, or 38.8%, to $1,824,596 for the nine months ended September 30, 2025, primarily due to a prior year goodwill impairment charge of $1,107,465 [147]. Acquisition and Integration - The company completed the acquisition of Omni Newco, LLC on January 25, 2024, and has exceeded initial expectations regarding cost synergies from this integration [110]. - The Omni Logistics segment contributed to the revenue increase due to an extra twenty-four days included in 2025 following the Omni Acquisition in January 2024 [146]. - Corporate operating loss increased to $18,289 for the three months ended September 30, 2025, compared to $1,799 in the same period in 2024, primarily due to acquisition and integration expenses [144]. - The company incurred significant indebtedness related to the Omni Acquisition, which could have important consequences for its business operations [183]. Market Conditions and Strategic Alternatives - The company has experienced a decrease in industry freight volumes, as measured by the Cass Freight Index, in each of the first three quarters of 2025 compared to the same periods in 2024 [107]. - The company has initiated a comprehensive review of strategic alternatives to maximize shareholder value, including potential sale or merger options [109]. - The company’s earnings depend significantly on increasing freight volume and revenue per shipment, particularly in a challenging freight environment [96]. Tax and Compliance - The effective tax rate for the three months ended September 30, 2025 was (1.6)%, compared to (4.0)% for the same period in 2024, influenced by interest expense disallowances and other factors [119]. - The effective tax rate for the nine months ended September 30, 2025 was (3.2)%, compared to 15.0% for the same period in 2024, primarily due to interest expense disallowances [150]. - The company expects to maintain compliance with its leverage ratio covenant over the next year, which is critical to avoid default under the Credit Agreement [183]. Cash Flow and Capital Expenditures - Net cash provided by operating activities increased to $67,112 for the nine months ended September 30, 2025, compared to a net cash used of $45,770 for the same period in 2024, primarily due to increased income from continuing operations [184]. - Net cash used in investing activities significantly decreased to $18,976 for the nine months ended September 30, 2025, from $1,592,878 in the same period of 2024, largely due to the absence of the Omni Acquisition in 2025 [185]. - Capital expenditures for the first nine months of 2025 were $20,765, down from $29,810 in 2024, primarily related to technology and operating equipment purchases [185].

Financial Performance - Forward Air Corporation reported consolidated revenue of $632 million for Q3 2025, a decrease of 3.7% from $656 million in Q3 2024[5] - Operating income for the third quarter was $15 million, down from $23 million in the same period last year, representing a decline of 33.9%[5] - Consolidated EBITDA for Q3 2025 was $78 million, compared to $86 million in Q3 2024, reflecting a decrease of 9.8%[6] - Free cash flow for Q3 2025 was $48.9 million, an increase of 16.9% from $41.8 million in Q3 2024[8] - Consolidated EBITDA for the nine months ended September 30, 2025, was $226,451, compared to $238,451 for the same period in 2024, reflecting a slight decrease[34] Segment Performance - The Omni segment achieved its highest revenue of $340 million, an increase of $5 million year-over-year, with reported EBITDA rising by $6 million to $33 million[3] - Total operating revenue for the Omni Logistics segment increased by 1.5% to $339,584,000 for the three months ended September 30, 2025, compared to $334,538,000 in 2024[19] - Income from operations for the Omni Logistics segment rose significantly by 758.2% to $9,749,000, up from $1,136,000 in the same period last year[19] - Total operating expenses for the Omni Logistics segment decreased by 1.1% to $329,835,000 in Q3 2025, down from $333,402,000 in Q3 2024[19] Cash Flow and Liquidity - Liquidity at the end of Q3 2025 was $413 million, up from $368 million at the end of Q2 2025[7] - Cash provided by operations totaled $67 million for the first three quarters of 2025, a significant improvement of $113 million compared to a cash usage of $46 million in the same period last year[7] - Cash and cash equivalents at the end of the period increased to $140,354,000 from $104,903,000 at the end of December 31, 2024[23] - The net cash provided by operating activities of continuing operations was $67,112 for the nine months ended September 30, 2025, compared to a net cash used of $45,770 in the same period of 2024[27] - The company reported a net increase in cash and cash equivalents of $35,088 for the nine months ended September 30, 2025, compared to a decrease of $1,807,904 in 2024[27] Operational Initiatives - The company implemented additional cost reduction initiatives in Q3 2025 to align with current freight demand[2] - The integration of U.S. and Canadian business operations is underway, aiming to create a cohesive One Ground Network[4] - The company expects to achieve and accelerate synergy capture and eliminate costs from its structure as part of its long-term growth strategy[35] - The company plans to enhance shareholder value through improved operational efficiency and cost control measures[35] Market and Risk Factors - Total pounds shipped decreased by 14.1% to 612,449,000 pounds in Q3 2025, down from 713,213,000 pounds in Q3 2024[17] - Revenue per hundredweight increased by 4.0% to $31.70 in Q3 2025, compared to $30.47 in Q3 2024[17] - Drayage revenue per shipment increased by 4.9% to $864 in Q3 2025, compared to $824 in Q3 2024[21] - The company anticipates potential risks including economic factors, integration challenges from acquisitions, and competition affecting future performance[36] Loss and Impairment - Net loss from continuing operations improved to $(23,757,000) in Q3 2025, compared to $(34,198,000) in Q3 2024[25] - For the nine months ended September 30, 2025, the net loss from continuing operations was $105,312, compared to a net loss of $1,089,463 for the same period in 2024, indicating a significant improvement[27] - The company incurred an impairment of goodwill of $1,107,465 in the nine months ended September 30, 2024, with no impairment recorded in 2025[34] - The company reported depreciation and amortization expenses of $111,914 for the nine months ended September 30, 2025, compared to $106,321 in 2024[27]

Core Viewpoint - Forward Air's stock has declined significantly due to the slowdown in its acquisition process, with no imminent buyout expected, leading to investor concerns and calls for a strategic review of operations [1][2][3]. Financial Performance - In the second quarter, Forward Air reported adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $74 million, reflecting a $5 million increase sequentially [5]. - The company's net debt stood at $1.69 billion, which is 5.7 times its last 12 months' consolidated adjusted EBITDA of $298 million, an increase from 5.3 times at the end of the first quarter [5]. Stock Performance - Forward Air's shares fell more than 20% during a recent trading session, closing at $19.19 per share, down 4.7% for the day, and have decreased over 30% in the past month due to the lack of a viable acquisition offer [2]. - Prior to the announcement of the Omni Logistics deal in August 2023, shares of Forward Air traded at $110 [5]. Acquisition Process - Reports indicate that the auction process for Forward Air has slowed due to unsatisfactory bids from private equity firms, with Clearlake Capital and Apollo Global Management still in contention after submitting second-round bids [1][4]. - Investors have expressed dissatisfaction with the previous merger with Omni Logistics, which increased the company's debt and raised concerns about competition with existing customers [3]. Upcoming Events - Forward Air is scheduled to report its third-quarter results after the market closes on November 5 [5].

Core Insights - Forward Air's Chief Information Officer Joseph Tomasello resigned on October 13, with the notice filed on October 10 [1] - Jason Ringgenberg has been appointed as the interim CIO, bringing extensive experience in information technology and the transportation industry [2] - The executive changes are part of a broader operational revamp following challenges from the 2024 acquisition of Omni Logistics, which resulted in a nearly $1 billion net loss [4] Company Background - Prior to joining Forward Air, Tomasello had over eight years of experience at FedEx in various leadership roles [2] - Ringgenberg previously served as CIO for Yellow Corp and has a long tenure at Accenture, focusing on the freight and logistics sector [3] Strategic Developments - Forward Air is exploring options for its future, including a potential sale or merger, while emphasizing that these considerations will not affect the fundamentals of the newly merged company [5] - The company announced plans to reincorporate in Delaware to maximize shareholder value [5] - Omni Logistics is expanding its operations to include an automotive replenishment service in collaboration with a global automaker [4]

Core Insights - Forward Air Corporation hosted the Fourth Annual Drive for Hope Golf Tournament on September 29-30, raising $526,000 for Hope For The Warriors [1] Company Initiatives - The funds raised will benefit Hope For The Warriors, a national non-profit organization that supports Veterans and their families [1]

Group 1 - Forward Air Corporation (FWRD) shares have increased by over threefold since April, with significant gains occurring during the summer [1] - The surge in stock price is attributed to the company's response to shareholder activist pressure by putting itself up for sale [1]

Core Insights - Forward Air (FWRD) reported revenue of $618.84 million for the quarter ended June 2025, a decrease of 3.9% year-over-year, and an EPS of -$0.41 compared to -$23.29 in the same quarter last year [1] - The revenue fell short of the Zacks Consensus Estimate of $637.67 million, resulting in a surprise of -2.95%, while the EPS surprise was -141.18% against a consensus estimate of -$0.17 [1] Financial Performance Metrics - Operating Revenues from Expedited Freight were $257.7 million, below the two-analyst average estimate of $271.5 million, reflecting a year-over-year decline of 11.5% [4] - Operating Revenues from Eliminations and other operations reported at -$26.17 million, compared to the average estimate of -$20 million [4] - Operating Revenues from Omni Logistics were $328.32 million, slightly below the average estimate of $331.6 million, but showed a year-over-year increase of 5.3% [4] - Operating Revenues from Intermodal were $59.15 million, also below the average estimate of $64.3 million, with a year-over-year change of -0.3% [4] Stock Performance - Forward Air's shares have returned +10.5% over the past month, outperforming the Zacks S&P 500 composite's +2.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]