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Daseke Inc. saw its fourth-quarter results swing to a profit from a year-ago loss, even as revenue declined.
The Addison, Texas-based flatbed transportation and logistics company posted Q4 net income of $7.3 million, or 9 cents per common share, compared with a net loss of $18.4 million, 31 cents, during the year-ago period. Total Q4 revenue decreased 17% to $335.6 million compared with $403 million in Q4 2019.
Wall Street had been expecting a loss of 4 cents per share on quarterly revenue of $334.1 million, according to Zack’s Consensus Estimate.
The flatbed solutions segment reported Q4 revenue decreased 5% to $142.1 million from $150.3 million the prior year. The segment’s Q4 net loss narrowed to $11 million from $12.6 million a year ago. The company’s specialized solutions segment saw Q4 revenue decrease 24% to $196.5 million from $257.4 million in Q4 2019. Net income improved to $10.5 million from a net loss of $25.3 million in 2019.
Daseke noted in its Jan. 29 report that the Q4 revenue declines were driven by completion of certain renewable and wind-related projects, as well as lower freight volumes in both the flatbed and specialized segments due to the economic impact of the coronavirus pandemic.
However, it noted that the higher Q4 net income was primarily driven by cost reductions through operational integrations and business improvement plans, along with stronger freight rates.
But these factors were partially offset by lower freight volumes and higher insurance costs.
“I’m proud to say the strong results delivered during this year reflect significant hard work by everyone on this team executing our 2020 priorities,” said Jonathan Shepko, the interim CEO at Daseke, during a conference call with investors. “I’d like to also take this opportunity to thank our management teams, who shouldered much of this change while successfully managing their businesses through the backdrop of a global pandemic.”
Shepko said the Q4 results capped a year of change for Daseke, as the company in late 2019 made a fundamental shift in how it operates that was focused on rationalizing operations and cost structures.
“Daseke’s transformation has been focused on operational excellence and improving our cost structure to drive performance, reduce costs and achieve greater efficiency,” Shepko said. “Looking ahead in 2021, our priorities will be continuing operational excellence, platform optimization and demonstrating our ability to drive shareholder value for sustainable growth initiatives.”
Shepko added, “We now have a leaner, more streamlined business, focused on execution and positioned to immediately accommodate creative growth opportunities as they arise.”
Daseke’s leadership structure has also undergone some change. Jason Bates was appointed to the post of CFO last April, and Rick Williams was named COO the next month.
For the full year, Daseke reported net income of $6.2 million, 2 cents, on revenue of $1.5 billion, compared with a net loss of $307.4 million, $4.86, on revenue of $1.7 billion in 2019. The revenue declines were attributed to virus-related declines in freight volumes, and the strategic reduction of business related to consolidation of some business.
Daseke ranks No. 23 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.
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