Werner Enterprises Reports Revenue, Profit Decline for Q4

CEO Cites Structural Improvements Ahead of Return to Normalization
Derek Leathers
“We made disciplined investments toward our continued pursuit and industry leadership of innovation,” Werner CEO Derek Leathers, shown at an industry trade show, says of the carrier's efforts in the fourth quarter. (John Sommers II for Transport Topics)

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Werner Enterprises reported a drop in revenue and earnings year-over-year during the fourth quarter of 2023, the company detailed Feb. 6.

The Omaha, Neb.-based freight carrier and logistics company posted net income attributable to itself of $23.6 million, or 37 cents a diluted share, for the three months ending Dec. 31. That compared with $60.2 million, or 94 cents a share, during the same time the previous year. Total revenue decreased 5% to $821.9 million from $861.5 million.

Werner ranks No. 17 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 34 on the TT Top 100 list of the largest logistics companies.

Werner noted in the report that the revenue decline was due to a $54.7 million decrease in Truckload Transportation Services (TTS) revenues. A significant portion of that was attributed to a $24.9 million lower fuel surcharge revenue. This partially was offset by logistics segment revenue growth of $13.5 million, which was bolstered by an earlier acquisition of ReedTMS.

“Clearly, 2023 was a prolonged and challenging operating environment,” Werner CEO Derek Leathers said during a call with investors. “Our earnings were down and did not meet our expectations. However, we made structural improvements that will set us up for future success as normalization returns.”


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Leathers added that dedicated operations proved to be durable and resilient while the one-way trucking business experienced a rate-per-mile decline that was more favorable than industry benchmarks. He also noted the logistics business generated full-year volume and revenue growth.

“Despite the backdrop, our leadership team and nearly 14,000 talented Werner team members stayed the course, executing on our strategy,” Leathers said. “Our drive strategy continues to help inform our decisions and lead to acceleration across our core businesses. In 2023, our dedicated business performed as expected, showing durability and resiliency in one of the most challenging operating environments that I’ve witnessed in my 30-plus years in the industry.”

Leathers expects to see margin expansion when normalization returns. He also noted that the company executed structural cost changes that resulted in $43 million in savings. In addition, Werner leaned into improved network optimization and improved productivity that helped to offset rate pressure, cost inflation and declining resale values of equipment.

Year in Review

Werner Enterprises' 2023 financials compared with a year earlier:

2023: Net income — $112.4 million, $1.76 per share. Revenue — $3.28 billion.

2022: Net income — $241.3 million, $3.74 per share. Revenue — $3.29 billion.

Source: Werner Enterprises

“We made disciplined investments toward our continued pursuit and industry leadership of innovation,” Leathers said. “Our fleet remains modern, safe, reliable and fuel-efficient. We also made significant advancements in our technology stack by transitioning truckload brokerage, including Reed and intermodal business, to our new cloud-based Edge TMS solution. In 2024, we are transitioning our one-way business to the Werner Edge platform.”

Results were mixed in terms of Wall Street expectations. Analysts had been looking for 44 cents per share and quarterly revenue of $811.06 million, according to Zacks Consensus Estimate.

TTS revenue in Q4 decreased 9% to $580.1 million from $634.8 million during the same time the previous year. Operating income fell 57% to $34.3 million from $80.3 million. The segment includes dedicated and one-way truckload operations.

The Dedicated segment experienced net reduction in average trucks while revenue per truck per week increased. The report noted that pipeline opportunities remain healthy and client retention remains strong despite a highly competitive environment. One-way truckload customer freight demand was stable with slightly better-than-expected peak volumes, but at significantly reduced pricing compared to the prior-year period.


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Logistics revenue increased 6% to $227 million from $213.5 million the prior year, and operating income fell 54% to $4.58 million from $9.87 million. The decline in operating income was due to a competitive freight and rate market despite generally stronger volume and load growth overall. The segment includes truckload logistics, intermodal and final-mile operations.

Truckload logistics revenue increased 15% due to a double-digit increase in shipments that partially was offset by a decline in revenue per shipment. Intermodal revenue decreased 27% due to fewer shipments and lower revenue per shipment. Final-mile revenues increased 6%.

Susquehanna International Group noted in a report that the results mirrored what other truckload businesses experienced during Q4. That includes margins being sharply compressed from a combination of sub-inflation pricing and further weakening in gains on equipment sales. The investment company pointed out that these results also came despite better peak season volumes.

“Notably, the margin pressure was very much in one-way as [Werner] confirmed dedicated margins remained in the double digits, with this extra-wide gap toward the bottom of the one-way pricing cycle also echoing other truckload carriers in recent weeks,” SIG analyst Bascome Majors said in the report. “Management intends to let one-way shrink in the coming quarters.”

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