Covenant Logistics Group Announces Third Quarter 2025 Financial and Operating Results

Core Insights - Covenant Logistics Group reported third quarter results with earnings of $0.35 per diluted share, reflecting flat year-over-year performance in asset-light business units and lower performance in Truckload business units due to higher costs and under-utilized equipment [2][3] Financial Performance - Total revenue for the third quarter was $296.9 million, a 3.1% increase from $287.9 million in the prior year [6][29] - Freight revenue, excluding fuel surcharge, was $268.8 million, up 4.0% from $258.6 million year-over-year [29] - Operating income decreased to $7.9 million from $16.2 million in the prior year [6][29] - Adjusted net income was $11.5 million, down from $15.2 million year-over-year [6][29] - The operating ratio increased to 97.3% from 94.4% in the prior year [6][29] Segment Performance - Truckload operations generated total revenue of $199.7 million, a slight increase of 0.3% year-over-year [11] - Expedited segment revenue decreased by $7.2 million, or 8.2%, while Dedicated segment revenue increased by $8.9 million, or 10.8% [12][30] - Managed Freight segment revenue rose by 14.0% year-over-year, attributed to new business awarded by a large customer [17][30] - Warehousing segment revenue was relatively stable, with a slight decrease of $0.4 million compared to the prior year [20] Capitalization and Liquidity - Total indebtedness increased by $48.7 million to approximately $268.3 million compared to December 31, 2024 [21][31] - Net indebtedness to total capitalization ratio rose to 38.8% from 33.4% at the end of 2024 [21][31] - Cash and cash equivalents totaled $2.7 million, with no outstanding borrowings under the ABL credit facility [21] Outlook - The company expects Adjusted EPS for the fourth quarter to be lower than the third quarter due to various negative factors, including credit losses and the impact of a government shutdown [23][24] - Long-term outlook remains positive with expectations of improving market conditions and internal plans to enhance profitability [24][25]