Knight-Swift Transportation (US:KNX)2025-02-20 17:08Financial Performance - Consolidated total revenue for 2024 was $7.4 billion, a 3.8% increase from 2023[269] - Consolidated net income attributable to Knight-Swift decreased by 45.8% to $117.6 million in 2024[269] - Total revenue for 2024 reached $5,034,941, a 7.2% increase from $4,698,655 in 2023[288] - The operating income for 2024 was $243,388 thousand, down from $338,153 thousand in 2023, indicating a decrease of around 28.0%[353] - The adjusted net income attributable to Knight-Swift for 2024 was $172,085 thousand, compared to $278,739 thousand in 2023, reflecting a decline of about 38.2%[348] - The adjusted operating income for 2024 was $347,867 thousand, compared to $434,578 thousand in 2023, which is a decline of about 20.0%[353] - The effective tax rate for 2024 was 22.1%, compared to 20.3% in 2023, primarily due to reduced pre-tax earnings and tax benefits from mark-to-market adjustments[341] Segment Performance - Truckload segment reported a 96.7% operating ratio in 2024, with a 9.4% increase in revenue, excluding fuel surcharge[270] - LTL segment achieved a 92.9% operating ratio in 2024, with a 16.2% increase in revenue, excluding fuel surcharge[270] - Logistics segment experienced a 95.9% operating ratio in 2024, with an 11.1% decrease in load count leading to a 1.3% decrease in revenue[270] - Intermodal segment had a 102.4% operating ratio in 2024, with a 3.5% increase in load count resulting in a 10.0% decrease in operating loss[270] - The truckload segment's total revenue for 2024 was $4,698,655 thousand, a decrease from $5,034,941 thousand in 2023, representing a decline of about 6.7%[357] - Total revenue for the LTL segment increased to $1,235,547,000 in 2024 from $1,082,454,000 in 2023, representing a growth of approximately 14.2%[360] - Total revenue for the Logistics segment decreased to $570,001,000 in 2024 from $582,250,000 in 2023, a decline of approximately 2.5%[362] - Total revenue for the Intermodal segment decreased to $387,232,000 in 2024 from $410,549,000 in 2023, reflecting a decline of about 5.7%[363] Cash Flow and Liquidity - Operating cash flows generated in 2024 amounted to $799.1 million, with Free Cash Flow at $233.8 million[270] - The company ended 2024 with $1.1 billion in unrestricted cash and cash equivalents[270] - Net cash provided by operating activities was $799,063,000 in 2024, down from $1,161,676,000 in 2023, a decrease of approximately 31.2%[379] - Free cash flow for 2024 was reported at $233,836,000, indicating a significant cash generation capability despite operational challenges[364] - Total unrestricted liquidity as of December 31, 2024, was $1,082,493,000, providing a solid financial cushion for the company[366] Expenses and Costs - Consolidated salaries, wages, and benefits increased by 13.8% to $2.82 billion in 2024, influenced by the full-year expense of U.S. Xpress[308] - Fuel expenses decreased by 0.8% to $871.1 million in 2024, attributed to lower average weekly fuel prices of $3.76 per gallon compared to $4.20 in 2023[311] - Operations and maintenance expenses rose by 15.5% to $546.9 million in 2024, driven by the inclusion of U.S. Xpress expenses and increased maintenance costs[314] - Insurance and claims expenses decreased by 31.8% to $415.7 million in 2024, reflecting the exit from the third-party insurance business[316] - Interest expense increased by 34.7% to $171.2 million, due to higher interest rates and increased average debt balance[335] Operational Metrics - Average tractors in the Truckload segment increased to 22,791 in 2024 from 20,948 in 2023[271] - Average revenue per tractor in the Truckload segment decreased by 7.6% to $193,436[288] - LTL shipments per day increased by 9.8% to 20,756, reflecting growth in operational capacity[294] - Logistics load count, excluding U.S. Xpress, declined by 26.3% year-over-year, while including U.S. Xpress, the decline was 11.1%[300] Future Outlook - The company expects labor costs to remain inflationary, impacting future salaries, wages, and benefits expenses[309] - The company expects net cash capital expenditures to be in the range of $575,000,000 to $625,000,000 in 2025, focusing on fleet replacements and network expansions[367] Miscellaneous - The average diesel price per gallon in the US decreased to $3.76 for 2024 from $4.20 for 2023, impacting operating costs related to fuel[412] - A hypothetical one percentage point increase in interest rates would increase annual interest expense by $21.1 million, given the current variable interest rate exposure[411] - Claims accruals could increase by $43.4 million if claims development factors based on historical experience increased by 10%[385] - The company has a weighted average interest rate of 6.0% as of December 31, 2024, related to its variable rate debt[411] - The company experienced inflation-sensitive operating expenses, impacting costs for equipment acquisition, repairs, and driver compensation[383] - Fair value assessments for goodwill and indefinite-lived intangible assets were conducted, confirming that fair value exceeded carrying value as of June 30, 2024[390] - The company has not used derivative financial instruments to hedge fuel price exposure but continues to evaluate this possibility[412] - Management's estimates and assumptions significantly impact the reported amounts of assets, liabilities, revenue, and expenses in the financial statements[384]