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Forward Air Corp. on July 27 reported all-time quarterly records for revenue, income from operations and net income per diluted share for the second quarter.
The Greeneville, Tenn.-based ground transportation and logistics services provider posted net income of $55.4 million, or $2.04 a diluted share, for the three months ending June 30. That marks an 80.7% increase compared with $30.7 million, $1.11, during the same time the previous year. Total revenue increased by 22.5% to $515.2 million from $420.7 million.
“Our Grow Forward strategy of collaborating with our customers on selecting higher-quality freight, pricing the freight appropriately and operating in a clean, safe network contributed to our strong financial performance,” CEO Tom Schmitt said in a statement. “In the third quarter of the prior year, we completed a process to cleanse inefficient freight from our network. We have fully replaced the cleansed inefficient freight with higher-quality freight.”
The results exceeded expectations of Wall Street analysts, which had been looking for $2.02 per share and quarterly revenue of $511.05 million, according to Zacks Consensus Estimate.
“Momentum continues in the first weeks of the third quarter with tonnage 3% higher than the same period of the prior year and strong revenue growth across all lines of business driven by continued growth strategies, strong demand for our services and higher fuel surcharges,” Schmitt said. “With the shift to premium freight in our network, our business model today is more robust and resilient than in the past.”
Schmitt is optimistic that the company will exceed its previously announced annual net income per diluted share target of $6.30. The revised net income per diluted share target for this year is at least $7.
“We continue to execute on our commitment to return value to our shareholders,” Schmitt said. “In the past five years, we have returned approximately $376 million to shareholders in the form of dividends and share repurchases. Our confidence in the growth potential of our business is reflected in the increase to our quarterly dividend and continued share repurchases in 2022.”
Income from operations increased 79.3% to $75.5 million from $42.1 million during the prior-year quarter. Operating margin also showed a notable improvement by increasing 470 basis points to 14.7% from 10% year-over-year.
• Expedited freight revenue for Q2 increased 16.2% to $408.9 million from $351.7 million a year ago. Income from operations increased 81.9% to $63.1 million from $34.7 million. This was driven by an increase in revenue per shipment that partially was offset by a decrease in total shipments. The segment includes network, truckload and final-mile operations.
Year-over-year revenue comparisons in other segments:
• Network increased 25.4% to $263.4 million from $210.1 million.
• Truckload increased 5.6% to $60.1 million from $57 million.
• Final-mile increased 4.5% to $73 million from $69.9 million.
• Intermodal increased 53.9% to $106.4 million from $69.1 million. Income from operations increased 81.1% to $15.2 million from $8.39 million.
Forward Air ranks No. 27 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 1 on the air/expedited sector list.
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