Delaware | 001-35007 | 20-5589597 | |||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | |||
20002 North 19th Avenue, Phoenix, Arizona | 85027 | ||||
(Address of principal executive offices) | (Zip Code) | ||||
(602) 269-2000 | |||||
(Registrant's telephone number, including area code) | |||||
N/A | |||||
(Former name or former address, if changed since last report) | |||||
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | |||||
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
ITEM 2.02 | RESULTS OF OPERATIONS AND FINANCIAL CONDITION |
ITEM 7.01 | REGULATION FD DISCLOSURE |
ITEM 9.01 | FINANCIAL STATEMENTS AND EXHIBITS |
Knight-Swift Transportation Holdings Inc. | |||||
(Registrant) | |||||
Date: | July 25, 2018 | /s/ Adam W. Miller | |||
Adam W. Miller | |||||
Chief Financial Officer |
Exhibit 99.1 |
Knight-Swift Transportation Holdings Inc. Reports Second Quarter 2018 Revenue and Earnings |
Key Financial Highlights |
Quarter-to-Date June 30, (1) | ||||||||||
2018 | 2017 | Change | ||||||||
(Dollars in thousands, except per share data) | ||||||||||
Total revenue | $ | 1,331,683 | $ | 273,243 | 387.4 | % | ||||
Revenue, excluding fuel surcharge | $ | 1,169,748 | $ | 247,022 | 373.5 | % | ||||
Operating income | $ | 124,242 | $ | 28,410 | 337.3 | % | ||||
Adjusted Operating Income (2) | $ | 134,929 | $ | 32,588 | 314.0 | % | ||||
Net income attributable to Knight-Swift | $ | 91,323 | $ | 17,970 | 408.2 | % | ||||
Adjusted Net Income Attributable to Knight-Swift (2) | $ | 99,632 | $ | 20,577 | 384.2 | % | ||||
Earnings per diluted share | $ | 0.51 | $ | 0.22 | 131.8 | % | ||||
Adjusted EPS (2) | $ | 0.56 | $ | 0.25 | 124.0 | % |
(1) | For information regarding comparability of the reported results due to mergers and acquisitions, refer to footnote (1) of the Condensed Consolidated Income Statements (Unaudited), in the schedules following this release. |
(2) | See GAAP to non-GAAP reconciliation in the schedules following this release. |
Segment Financial Performance |
Knight Transportation (1) | Quarter-to-Date June 30, | |||||||||
2018 | 2017 | Change | ||||||||
(Dollars in thousands) | ||||||||||
Knight Trucking: | ||||||||||
Revenue, excluding fuel surcharge and intersegment transactions | $ | 255,224 | $ | 194,049 | 31.5 | % | ||||
Operating income | $ | 56,582 | $ | 25,762 | 119.6 | % | ||||
Adjusted Operating Income (2) | $ | 56,925 | $ | 29,940 | 90.1 | % | ||||
Operating ratio | 80.8 | % | 88.3 | % | (750 | bps) | ||||
Adjusted Operating Ratio (2) | 77.7 | % | 84.6 | % | (690 | bps) | ||||
Knight Logistics: | ||||||||||
Revenue, excluding intersegment transactions | $ | 76,639 | $ | 52,973 | 44.7 | % | ||||
Operating income | $ | 4,108 | $ | 2,648 | 55.1 | % | ||||
Operating ratio | 94.8 | % | 95.2 | % | (40 | bps) | ||||
Adjusted Operating Ratio (2) | 94.6 | % | 95.0 | % | (40 | bps) |
(1) | For information regarding comparability of the reported results due to mergers and acquisitions, refer to footnote (1) of the Condensed Consolidated Income Statements (Unaudited), in the schedules following this release. |
(2) | See GAAP to non-GAAP reconciliation in the schedules following this release. |
2 |
Swift Transportation (1) | Quarter-to-Date June 30, 2018 | ||||||||||||||
Swift Truckload | Swift Dedicated | Swift Refrigerated | Swift Intermodal | ||||||||||||
Revenue, excluding fuel surcharge | $ | 363,066 | $ | 141,993 | $ | 180,834 | $ | 94,730 | |||||||
Operating income | $ | 45,787 | $ | 20,691 | $ | 3,597 | $ | 4,166 | |||||||
Operating ratio | 89.1 | % | 87.1 | % | 98.2 | % | 96.3 | % | |||||||
Adjusted Operating Ratio (2) | 87.4 | % | 85.4 | % | 98.0 | % | 95.6 | % |
(1) | For information regarding comparability of the reported results due to mergers and acquisitions, refer to footnote (1) of the Condensed Consolidated Income Statements (Unaudited), in the schedules following this release. |
(2) | See GAAP to non-GAAP reconciliation in the schedules following this release. |
3 |
Consolidated Liquidity and Capital Resources |
Year-to-Date June 30, | Change | ||||||||||
2018 | 2017 | ||||||||||
(In thousands) | |||||||||||
Net cash provided by operating activities | $ | 375,912 | $ | 120,914 | $ | 254,998 | |||||
Net cash used in investing activities | (232,564 | ) | (16,345 | ) | (216,219 | ) | |||||
Net cash used in financing activities | (126,769 | ) | (23,795 | ) | (102,974 | ) | |||||
Net increase in cash, restricted cash, and equivalents(2) | $ | 16,579 | $ | 80,774 | $ | (64,195 | ) | ||||
Net capital expenditures | $ | (121,386 | ) | $ | (22,587 | ) | $ | (98,799 | ) |
(1) | For information regarding comparability of the reported results due to mergers and acquisitions, refer to footnote (1) of the Condensed Consolidated Income Statements (Unaudited), in the schedules following this release. |
(2) | "Net increase in cash, restricted cash, and equivalents" is derived from changes within "Cash and cash equivalents," "Cash and cash equivalents – restricted," and the long-term portion of restricted cash included in "Other long-term assets" in the consolidated balance sheets. |
4 |
Other Information |
About Knight-Swift |
Conference Call |
Forward-Looking Statements |
• | any projections of earnings, revenues, cash flows, dividends, capital expenditures, or other financial items, |
• | any statement of plans, strategies, and objectives of management for future operations, |
• | any statements concerning proposed acquisition plans, new services or developments, |
• | any statements regarding future economic or industry conditions or performance, and |
• | any statements of belief and any statements of assumptions underlying any of the foregoing. |
• | the ability of our infrastructure to support future growth, whether we grow organically or through potential acquisitions, |
• | the future impact of the 2017 Merger, including achievement of anticipated synergies, |
• | the flexibility of our model to adapt to market conditions, |
• | our ability to recruit and retain qualified driving associates, |
• | future safety performance, |
• | future dedicated and refrigerated performance, |
• | our ability to gain market share, |
• | our ability and desire to expand our brokerage and intermodal operations, |
• | future equipment prices, our equipment purchasing plans, and our equipment turnover (including expected tractor trade-ins), |
• | our ability to sublease equipment to independent contractors, |
• | the impact of pending legal proceedings, |
• | the expected freight environment, including freight demand and volumes, |
• | economic conditions, including future inflation and consumer spending, |
• | our ability to obtain favorable pricing terms from vendors and suppliers, |
• | expected liquidity and methods for achieving sufficient liquidity, |
• | future fuel prices, |
• | future expenses and our ability to control costs, |
5 |
• | future third-party service provider relationships and availability, |
• | future contracted pay rates with independent contractors and compensation arrangements with driving associates, |
• | our expected need or desire to incur indebtedness, |
• | expected sources of liquidity for capital expenditures and allocation of capital, |
• | expected capital expenditures, |
• | future mix of owned versus leased revenue equipment, |
• | future asset utilization, |
• | future capital requirements, |
• | future return on capital, |
• | future tax rates, |
• | our intention to pay dividends in the future, |
• | future share repurchases, |
• | future trucking industry capacity, |
• | future rates, |
• | future depreciation and amortization, |
• | expected tractor and trailer fleet age, |
• | political conditions and regulations, including future changes thereto, |
• | future purchased transportation expense, and |
• | others. |
Investor Relations Contact Information |
6 |
Financial Statements |
Condensed Consolidated Income Statements (Unaudited) (1) |
Quarter-to-Date June 30, | Year-to-Date June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
(In thousands, except per share data) | |||||||||||||||
Revenue: | |||||||||||||||
Revenue, excluding fuel surcharge | $ | 1,169,748 | $ | 247,022 | $ | 2,293,920 | $ | 492,002 | |||||||
Fuel surcharge | 161,935 | 26,221 | 308,895 | 52,423 | |||||||||||
Total revenue | 1,331,683 | 273,243 | 2,602,815 | 544,425 | |||||||||||
Operating expenses: | |||||||||||||||
Salaries, wages, and benefits | 371,405 | 79,944 | 733,078 | 162,454 | |||||||||||
Fuel | 162,969 | 33,719 | 307,785 | 68,952 | |||||||||||
Operations and maintenance | 88,278 | 20,596 | 173,298 | 41,249 | |||||||||||
Insurance and claims | 53,126 | 8,294 | 112,274 | 16,865 | |||||||||||
Operating taxes and licenses | 22,671 | 4,615 | 45,821 | 9,046 | |||||||||||
Communications | 5,450 | 1,018 | 10,742 | 2,204 | |||||||||||
Depreciation and amortization of property and equipment | 95,748 | 29,246 | 189,611 | 58,803 | |||||||||||
Amortization of intangibles | 10,687 | 125 | 21,196 | 250 | |||||||||||
Rental expense | 47,703 | 1,228 | 100,578 | 2,551 | |||||||||||
Purchased transportation | 335,712 | 58,299 | 659,995 | 116,924 | |||||||||||
Miscellaneous operating expenses | 13,692 | 3,571 | 30,451 | 9,901 | |||||||||||
Merger-related costs | — | 4,178 | — | 4,178 | |||||||||||
Total operating expenses | 1,207,441 | 244,833 | 2,384,829 | 493,377 | |||||||||||
Operating income | 124,242 | 28,410 | 217,986 | 51,048 | |||||||||||
Interest income | 730 | 130 | 1,302 | 189 | |||||||||||
Interest expense | (7,132 | ) | (54 | ) | (13,896 | ) | (136 | ) | |||||||
Other income, net | 1,005 | 601 | 3,160 | 1,322 | |||||||||||
Other (expense) income, net | (5,397 | ) | 677 | (9,434 | ) | 1,375 | |||||||||
Income before income taxes | 118,845 | 29,087 | 208,552 | 52,423 | |||||||||||
Income tax expense | 27,217 | 10,828 | 46,192 | 19,058 | |||||||||||
Net income | 91,628 | 18,259 | 162,360 | 33,365 | |||||||||||
Net income attributable to noncontrolling interest | (305 | ) | (289 | ) | (673 | ) | (518 | ) | |||||||
Net income attributable to Knight-Swift | $ | 91,323 | $ | 17,970 | $ | 161,687 | $ | 32,847 | |||||||
Earnings per share: | |||||||||||||||
Basic | $ | 0.51 | $ | 0.22 | $ | 0.91 | $ | 0.41 | |||||||
Diluted | $ | 0.51 | $ | 0.22 | $ | 0.90 | $ | 0.40 | |||||||
Dividends declared per share: | $ | 0.06 | $ | 0.06 | $ | 0.12 | $ | 0.12 | |||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 178,451 | 80,520 | 178,307 | 80,416 | |||||||||||
Diluted | 179,398 | 81,349 | 179,321 | 81,276 |
(1) | The reported results do not include the results of operations of Swift and its subsidiaries on and prior to the merger with Knight on September 8, 2017 in accordance with the accounting treatment applicable to the transaction. The reported results do not include the results of operations of Abilene and its subsidiaries on and prior to its acquisition by Knight on March 16, 2018 in accordance with the accounting treatment applicable to the transaction. |
7 |
Condensed Consolidated Balance Sheets (Unaudited) (1) |
June 30, 2018 | December 31, 2017 | ||||||
(In thousands) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 115,494 | $ | 76,649 | |||
Cash and cash equivalents – restricted | 50,714 | 73,657 | |||||
Restricted investments, held to maturity, amortized cost | 21,498 | 22,232 | |||||
Trade receivables, net of allowance for doubtful accounts of $13,430 and $14,829, respectively | 598,850 | 574,265 | |||||
Prepaid expenses | 58,438 | 58,525 | |||||
Assets held for sale | 36,274 | 25,153 | |||||
Income tax receivable | 30,036 | 55,114 | |||||
Other current assets | 30,028 | 37,612 | |||||
Total current assets | 941,332 | 923,207 | |||||
Property and equipment, net | 2,403,491 | 2,384,221 | |||||
Goodwill | 2,917,584 | 2,887,867 | |||||
Intangible assets, net | 1,442,707 | 1,440,903 | |||||
Other long-term assets | 48,627 | 47,244 | |||||
Total assets | $ | 7,753,741 | $ | 7,683,442 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 141,465 | $ | 119,867 | |||
Accrued payroll and purchased transportation | 126,388 | 107,017 | |||||
Accrued liabilities | 155,249 | 186,379 | |||||
Claims accruals – current portion | 152,243 | 147,285 | |||||
Capital lease obligations and long-term debt – current portion | 65,876 | 49,002 | |||||
Total current liabilities | 641,221 | 609,550 | |||||
Revolving line of credit | 120,000 | 125,000 | |||||
Long-term debt – less current portion | 364,473 | 364,771 | |||||
Capital lease obligations – less current portion | 93,302 | 127,132 | |||||
Accounts receivable securitization | 215,000 | 305,000 | |||||
Claims accruals – less current portion | 213,101 | 206,144 | |||||
Deferred tax liabilities | 684,595 | 679,077 | |||||
Other long-term liabilities | 25,665 | 26,398 | |||||
Total liabilities | 2,357,357 | 2,443,072 | |||||
Stockholders’ equity: | |||||||
Common stock | 1,786 | 1,780 | |||||
Additional paid-in capital | 4,232,672 | 4,219,214 | |||||
Retained earnings | 1,159,687 | 1,016,738 | |||||
Total Knight-Swift stockholders' equity | 5,394,145 | 5,237,732 | |||||
Noncontrolling interest | 2,239 | 2,638 | |||||
Total stockholders’ equity | 5,396,384 | 5,240,370 | |||||
Total liabilities and stockholders’ equity | $ | 7,753,741 | $ | 7,683,442 |
(1) | The reported balances include the balances of Abilene as of June 30, 2018. |
8 |
Segment Operating Statistics (Unaudited) |
Quarter-to-Date June 30, | Year-to-Date June 30, | ||||||||||||||||||||
2018 | 2017 | Change | 2018 | 2017 | Change | ||||||||||||||||
Knight Trucking (4) | |||||||||||||||||||||
Average revenue per tractor (1) | $ | 52,353 | $ | 42,176 | 24.1 | % | $ | 100,824 | $ | 83,335 | 21.0 | % | |||||||||
Non-paid empty miles percentage | 13.5 | % | 12.5 | % | 100 | bps | 13.3 | % | 12.5 | % | 80 | bps | |||||||||
Average length of haul (miles) | 498 | 488 | 2.0 | % | 496 | 493 | 0.6 | % | |||||||||||||
Average tractors | 4,875 | 4,601 | 6.0 | % | 4,730 | 4,638 | 2.0 | % | |||||||||||||
Average trailers | 13,758 | 12,310 | 11.8 | % | 13,156 | 12,377 | 6.3 | % | |||||||||||||
Knight Logistics (4) | |||||||||||||||||||||
Revenue per load – Brokerage only (2) | $ | 1,627 | $ | 1,285 | 26.6 | % | $ | 1,601 | $ | 1,254 | 27.7 | % | |||||||||
Gross margin – Brokerage only | 13.7 | % | 14.3 | % | (60 | bps) | 14.1 | % | 14.2 | % | (10 | bps) | |||||||||
Swift Truckload | |||||||||||||||||||||
Average revenue per tractor (3) | $ | 48,584 | $ | 44,674 | 8.8 | % | $ | 93,627 | $ | 87,594 | 6.9 | % | |||||||||
Non-paid empty miles percentage | 12.8 | % | 11.4 | % | 140 | bps | 12.6 | % | 11.5 | % | 110 | bps | |||||||||
Average length of haul (miles) | 578 | 598 | (3.3 | %) | 585 | 601 | (2.7 | %) | |||||||||||||
Average tractors | 7,473 | 9,844 | (24.1 | %) | 7,844 | 9,925 | (21.0 | %) | |||||||||||||
Average trailers | 30,594 | 35,470 | (13.7 | %) | 31,860 | 35,736 | (10.8 | %) | |||||||||||||
Swift Dedicated | |||||||||||||||||||||
Average revenue per tractor (3) | $ | 47,729 | $ | 46,136 | 3.5 | % | $ | 92,249 | $ | 90,655 | 1.8 | % | |||||||||
Non-paid empty miles percentage | 19.4 | % | 18.5 | % | 90 | bps | 18.8 | % | 18.6 | % | 20 | bps | |||||||||
Average length of haul (miles) | 183 | 179 | 2.2 | % | 186 | 180 | 3.3 | % | |||||||||||||
Average tractors | 2,975 | 3,106 | (4.2 | %) | 3,006 | 3,090 | (2.7 | %) | |||||||||||||
Average trailers | 14,787 | 14,920 | (0.9 | %) | 15,000 | 14,844 | 1.1 | % | |||||||||||||
Swift Refrigerated | |||||||||||||||||||||
Average revenue per tractor (3) | $ | 46,061 | $ | 49,368 | (6.7 | %) | $ | 93,293 | $ | 96,812 | (3.6 | %) | |||||||||
Non-paid empty miles percentage | 6.8 | % | 7.5 | % | (70 | bps) | 7.0 | % | 7.5 | % | (50 | bps) | |||||||||
Average length of haul (miles) | 398 | 406 | (2.0 | %) | 394 | 411 | (4.1 | %) | |||||||||||||
Average tractors | 3,926 | 3,399 | 15.5 | % | 3,867 | 3,405 | 13.6 | % | |||||||||||||
Average trailers | 3,683 | 4,362 | (15.6 | %) | 3,895 | 4,429 | (12.1 | %) | |||||||||||||
Swift Intermodal | |||||||||||||||||||||
Average revenue per load (3) | $ | 1,922 | $ | 1,843 | 4.3 | % | $ | 1,895 | $ | 1,856 | 2.1 | % | |||||||||
Load count | 49,277 | 44,135 | 11.7 | % | 96,653 | 84,801 | 14.0 | % | |||||||||||||
Average tractors | 621 | 503 | 23.5 | % | 600 | 500 | 20.0 | % | |||||||||||||
Average containers | 9,119 | 9,130 | (0.1 | %) | 9,120 | 9,130 | (0.1 | %) |
(1) | Computed with revenue, excluding fuel surcharge and intersegment transactions |
(2) | Computed with revenue, excluding intersegment transactions |
(3) | Computed with revenue, excluding fuel surcharge |
(4) | The reported results do not include the results of operations of Abilene and its subsidiaries on and prior to its acquisition by Knight on March 16, 2018 in accordance with the accounting treatment applicable to the transaction. |
9 |
Non-GAAP Financial Measures and Reconciliations |
Non-GAAP Reconciliation (Unaudited): |
Adjusted Operating Income and Adjusted Operating Ratio (1) (2) |
Quarter-to-Date June 30, | Year-to-Date June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
GAAP Presentation | (Dollars in thousands) | ||||||||||||||
Total revenue | $ | 1,331,683 | $ | 273,243 | $ | 2,602,815 | $ | 544,425 | |||||||
Total operating expenses | (1,207,441 | ) | (244,833 | ) | (2,384,829 | ) | (493,377 | ) | |||||||
Operating income | $ | 124,242 | $ | 28,410 | $ | 217,986 | $ | 51,048 | |||||||
Operating ratio | 90.7 | % | 89.6 | % | 91.6 | % | 90.6 | % | |||||||
Non-GAAP Presentation | |||||||||||||||
Total revenue | $ | 1,331,683 | $ | 273,243 | $ | 2,602,815 | $ | 544,425 | |||||||
Fuel surcharge | (161,935 | ) | (26,221 | ) | (308,895 | ) | (52,423 | ) | |||||||
Revenue, excluding fuel surcharge | 1,169,748 | 247,022 | 2,293,920 | 492,002 | |||||||||||
Total operating expenses | 1,207,441 | 244,833 | 2,384,829 | 493,377 | |||||||||||
Adjusted for: | |||||||||||||||
Fuel surcharge | (161,935 | ) | (26,221 | ) | (308,895 | ) | (52,423 | ) | |||||||
Amortization of intangibles (3) | (10,687 | ) | — | (21,196 | ) | — | |||||||||
Merger-related costs (4) | — | (4,178 | ) | — | (4,178 | ) | |||||||||
Adjusted Operating Expenses | 1,034,819 | 214,434 | 2,054,738 | 436,776 | |||||||||||
Adjusted Operating Income | $ | 134,929 | $ | 32,588 | $ | 239,182 | $ | 55,226 | |||||||
Adjusted Operating Ratio | 88.5 | % | 86.8 | % | 89.6 | % | 88.8 | % |
(1) | Pursuant to the requirements of Regulation G, this table reconciles consolidated GAAP operating ratio to consolidated non-GAAP Adjusted Operating Ratio. |
(2) | The reported results do not include the results of operations of Swift and its subsidiaries on and prior to the merger with Knight on September 8, 2017 in accordance with the accounting treatment applicable to the transaction. The reported results do not include the results of operations of Abilene and its subsidiaries on and prior to its acquisition by Knight on March 16, 2018 in accordance with the accounting treatment applicable to the transaction. |
10 |
(3) | "Amortization of intangibles" reflects the non-cash amortization expense relating to intangible assets identified in the 2017 Merger and historical Knight acquisitions. Certain data necessary to complete the purchase price allocation for the 2017 Merger and Abilene Acquisition is open for adjustments during the measurement periods, and includes, but is not limited to, finalization of certain contingent liabilities and the calculation of deferred taxes based upon the underlying tax basis of assets acquired and liabilities assumed and assessment of other tax-related items. We believe the estimates used are reasonable but are subject to change as additional information becomes available. |
(4) | During the second quarter of 2017, Knight incurred certain merger-related expenses associated with the 2017 Merger, consisting of legal and professional fees. |
Non-GAAP Reconciliation (Unaudited): |
Adjusted Net Income Attributable to Knight-Swift and Adjusted EPS (1) (2) |
Quarter-to-Date June 30, | Year-to-Date June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
(Dollars In thousands) | |||||||||||||||
GAAP: Net income attributable to Knight-Swift | $ | 91,323 | $ | 17,970 | $ | 161,687 | $ | 32,847 | |||||||
Adjusted for: | |||||||||||||||
Income tax expense attributable to Knight-Swift | 27,217 | 10,828 | 46,192 | 19,058 | |||||||||||
Income before income taxes attributable to Knight-Swift | 118,540 | 28,798 | 207,879 | 51,905 | |||||||||||
Amortization of intangibles (3) | 10,687 | — | 21,196 | — | |||||||||||
Merger-related costs (4) | — | 4,178 | — | 4,178 | |||||||||||
Adjusted income before income taxes | 129,227 | 32,976 | 229,075 | 56,083 | |||||||||||
Provision for income tax expense at effective rate | (29,595 | ) | (12,399 | ) | (50,738 | ) | (20,629 | ) | |||||||
Non-GAAP: Adjusted Net Income Attributable to Knight-Swift | $ | 99,632 | $ | 20,577 | $ | 178,337 | $ | 35,454 |
Quarter-to-Date June 30, | Year-to-Date June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
GAAP: Earnings per diluted share | $ | 0.51 | $ | 0.22 | $ | 0.90 | $ | 0.40 | |||||||
Adjusted for: | |||||||||||||||
Income tax expense attributable to Knight-Swift | 0.15 | 0.13 | 0.26 | 0.23 | |||||||||||
Income before income taxes attributable to Knight-Swift | 0.66 | 0.35 | 1.16 | 0.64 | |||||||||||
Amortization of intangibles (3) | 0.06 | — | 0.12 | — | |||||||||||
Merger-related costs (4) | — | 0.05 | — | 0.05 | |||||||||||
Adjusted income before income taxes | 0.72 | 0.41 | 1.28 | 0.69 | |||||||||||
Provision for income tax expense at effective rate | (0.16 | ) | (0.15 | ) | (0.28 | ) | (0.25 | ) | |||||||
Non-GAAP: Adjusted EPS | $ | 0.56 | $ | 0.25 | $ | 0.99 | $ | 0.44 |
(1) | Pursuant to the requirements of Regulation G, these tables reconcile consolidated GAAP net income attributable to Knight-Swift to non-GAAP consolidated Adjusted net income attributable to Knight-Swift and consolidated GAAP diluted earnings per share to non-GAAP consolidated Adjusted EPS. |
(2) | Refer to Non-GAAP Reconciliation (Unaudited): Adjusted Operating Income and Adjusted Operating Ratio – footnote (2). |
(3) | Refer to Non-GAAP Reconciliation (Unaudited): Adjusted Operating Income and Adjusted Operating Ratio – footnote (3). |
(4) | Refer to Non-GAAP Reconciliation (Unaudited): Adjusted Operating Income and Adjusted Operating Ratio – footnote (4). |
11 |
Non-GAAP Reconciliation (Unaudited): |
Segment Adjusted Operating Income and Adjusted Operating Ratio (1) (2) |
Knight Trucking Segment | Quarter-to-Date June 30, | Year-to-Date June 30, | |||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
GAAP Presentation | (Dollars in thousands) | ||||||||||||||
Total revenue | $ | 294,699 | $ | 220,323 | $ | 549,667 | $ | 439,013 | |||||||
Total operating expenses | (238,117 | ) | (194,561 | ) | (452,287 | ) | (392,991 | ) | |||||||
Operating income | $ | 56,582 | $ | 25,762 | $ | 97,380 | $ | 46,022 | |||||||
Operating ratio | 80.8 | % | 88.3 | % | 82.3 | % | 89.5 | % | |||||||
Non-GAAP Presentation | |||||||||||||||
Total revenue | $ | 294,699 | $ | 220,323 | $ | 549,667 | $ | 439,013 | |||||||
Fuel surcharge | (39,421 | ) | (26,221 | ) | (72,695 | ) | (52,423 | ) | |||||||
Intersegment transactions | (54 | ) | (53 | ) | (73 | ) | (81 | ) | |||||||
Revenue, excluding fuel surcharge and intersegment transactions | 255,224 | 194,049 | 476,899 | 386,509 | |||||||||||
Total operating expenses | 238,117 | 194,561 | 452,287 | 392,991 | |||||||||||
Adjusted for: | |||||||||||||||
Fuel surcharge | (39,421 | ) | (26,221 | ) | (72,695 | ) | (52,423 | ) | |||||||
Intersegment transactions | (54 | ) | (53 | ) | (73 | ) | (81 | ) | |||||||
Amortization of intangibles (3) | (343 | ) | — | (508 | ) | — | |||||||||
Merger-related costs (4) | — | (4,178 | ) | — | (4,178 | ) | |||||||||
Adjusted Operating Expenses | 198,299 | 164,109 | 379,011 | 336,309 | |||||||||||
Adjusted Operating Income | $ | 56,925 | $ | 29,940 | $ | 97,888 | $ | 50,200 | |||||||
Adjusted Operating Ratio | 77.7 | % | 84.6 | % | 79.5 | % | 87.0 | % |
Knight Logistics Segment | Quarter-to-Date June 30, | Year-to-Date June 30, | |||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
GAAP Presentation | (Dollars in thousands) | ||||||||||||||
Total revenue | $ | 78,434 | $ | 54,867 | $ | 145,611 | $ | 109,055 | |||||||
Total operating expenses | (74,326 | ) | (52,219 | ) | (137,921 | ) | (104,029 | ) | |||||||
Operating income | $ | 4,108 | $ | 2,648 | $ | 7,690 | $ | 5,026 | |||||||
Operating ratio | 94.8 | % | 95.2 | % | 94.7 | % | 95.4 | % | |||||||
Non-GAAP Presentation | |||||||||||||||
Total revenue | $ | 78,434 | $ | 54,867 | $ | 145,611 | $ | 109,055 | |||||||
Intersegment transactions | (1,795 | ) | (1,894 | ) | (3,175 | ) | (3,562 | ) | |||||||
Revenue, excluding intersegment transactions | 76,639 | 52,973 | 142,436 | 105,493 | |||||||||||
Total operating expenses | 74,326 | 52,219 | 137,921 | 104,029 | |||||||||||
Adjusted for: | |||||||||||||||
Intersegment transactions | (1,795 | ) | (1,894 | ) | (3,175 | ) | (3,562 | ) | |||||||
Adjusted Operating Expenses | 72,531 | 50,325 | 134,746 | 100,467 | |||||||||||
Adjusted Operating Income | $ | 4,108 | $ | 2,648 | $ | 7,690 | $ | 5,026 | |||||||
Adjusted Operating Ratio | 94.6 | % | 95.0 | % | 94.6 | % | 95.2 | % |
(1) | Pursuant to the requirements of Regulation G, these tables reconcile segment GAAP operating ratio to segment non-GAAP Adjusted Operating Ratio. |
(2) | The reported results do not include the results of operations of Abilene and its subsidiaries on and prior to the Abilene Acquisition, in accordance with the accounting treatment applicable to the transaction. |
(3) | "Amortization of intangibles" reflects the non-cash amortization expense relating to intangible assets identified in historical Knight acquisitions. |
(4) | During the second quarter of 2017, Knight incurred certain merger-related expenses associated with the 2017 Merger, consisting of legal and professional fees. |
12 |
Non-GAAP Reconciliation (Unaudited): |
Segment Adjusted Operating Income and Adjusted Operating Ratio — Continued (1) |
Swift Transportation | Quarter-to-Date June 30, 2018 | ||||||||||||||
Swift Truckload | Swift Dedicated | Swift Refrigerated | Swift Intermodal | ||||||||||||
GAAP Presentation | (Dollars in thousands) | ||||||||||||||
Total revenue | $ | 421,921 | $ | 160,874 | $ | 204,338 | $ | 112,662 | |||||||
Total operating expenses | (376,134 | ) | (140,183 | ) | (200,741 | ) | (108,496 | ) | |||||||
Operating Income | $ | 45,787 | $ | 20,691 | $ | 3,597 | $ | 4,166 | |||||||
Operating Ratio | 89.1 | % | 87.1 | % | 98.2 | % | 96.3 | % | |||||||
Non-GAAP Presentation | |||||||||||||||
Total revenue | $ | 421,921 | $ | 160,874 | $ | 204,338 | $ | 112,662 | |||||||
Fuel surcharge | (58,855 | ) | (18,881 | ) | (23,504 | ) | (17,932 | ) | |||||||
Revenue, excluding fuel surcharge | 363,066 | 141,993 | 180,834 | 94,730 | |||||||||||
Total operating expenses | 376,134 | 140,183 | 200,741 | 108,496 | |||||||||||
Adjusted for: | |||||||||||||||
Fuel surcharge | (58,855 | ) | (18,881 | ) | (23,504 | ) | (17,932 | ) | |||||||
Adjusted Operating Expenses | 317,279 | 121,302 | 177,237 | 90,564 | |||||||||||
Adjusted Operating Income | $ | 45,787 | $ | 20,691 | $ | 3,597 | $ | 4,166 | |||||||
Adjusted Operating Ratio | 87.4 | % | 85.4 | % | 98.0 | % | 95.6 | % |
Year-to-Date June 30, 2018 | |||||||||||||||
Swift Truckload | Swift Dedicated | Swift Refrigerated | Swift Intermodal | ||||||||||||
GAAP Presentation | (Dollars in thousands) | ||||||||||||||
Total revenue | $ | 851,177 | $ | 313,190 | $ | 405,162 | $ | 216,776 | |||||||
Total operating expenses | (770,581 | ) | (277,297 | ) | (392,123 | ) | (208,774 | ) | |||||||
Operating Income | $ | 80,596 | $ | 35,893 | $ | 13,039 | $ | 8,002 | |||||||
Operating Ratio | 90.5 | % | 88.5 | % | 96.8 | % | 96.3 | % | |||||||
Non-GAAP Presentation | |||||||||||||||
Total revenue | $ | 851,177 | $ | 313,190 | $ | 405,162 | $ | 216,776 | |||||||
Fuel surcharge | (116,767 | ) | (35,891 | ) | (44,399 | ) | (33,575 | ) | |||||||
Revenue, excluding fuel surcharge | 734,410 | 277,299 | 360,763 | 183,201 | |||||||||||
Total operating expenses | 770,581 | 277,297 | 392,123 | 208,774 | |||||||||||
Adjusted for: | |||||||||||||||
Fuel surcharge | (116,767 | ) | (35,891 | ) | (44,399 | ) | (33,575 | ) | |||||||
Adjusted Operating Expenses | 653,814 | 241,406 | 347,724 | 175,199 | |||||||||||
Adjusted Operating Income | $ | 80,596 | $ | 35,893 | $ | 13,039 | $ | 8,002 | |||||||
Adjusted Operating Ratio | 89.0 | % | 87.1 | % | 96.4 | % | 95.6 | % |
(1) | Pursuant to the requirements of Regulation G, these tables reconcile segment GAAP operating ratio to segment non-GAAP Adjusted Operating Ratio. |
13 |
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