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Forward Air Corp. reported record fourth-quarter revenue but a decline in net income.
The Greeneville, Tenn., ground transportation and logistics services company on Feb. 11 posted net income from continuing operations of $15.1 million, or 55 cents a diluted share, for the three months ending Dec. 31. That represents a 32.2% decrease from the same time last year at $22.3 million, 79 cents. The total operating revenue increased by 9.6% to $350.3 million from $319.7 million.
The results were mixed when it came to expectations by investment analysts on Wall Street, which had been looking for 72.3 cents per share and quarterly revenue of $344.1 million, according to Business Insider.
For the full year, Forward Air reported net income from continuing operations of $52.8 million, $1.89, on revenue of $1.27 billion, compared with net income of $82.3 million, $2.87, on revenue of $1.22 billion in 2019.
“Our growth strategies drove our record fourth-quarter revenue, which came in at the high end of our guidance range,” CEO Tom Schmitt said in a statement. “Our business momentum improved during the quarter, and through November we were ahead of our internal forecasts.”
Forward Air was hit with a previously disclosed cyberattack that temporarily interrupted operations and impacted results in December. The company also recorded an increase to an “earn-out liability” related to a prior acquisition.
“Excluding the impacts of these two discrete events, we would have exceeded the high end of our net income per diluted share guidance range,” Schmitt said. “Our organic growth has continued into the first quarter. Through January, our LTL tonnage is up 10.9% and our LTL shipments are up 14.4% year-over-year.”
Forward Air announced a 6% general rate increase on shipments Feb. 1. The increase is part of a growth strategy that involves infrastructure investments such as LTL network expansion and acquisitions of complementary businesses. Schmitt noted the year-over-year tonnage and shipment growth will become even more accretive following the rate increase.
“As we drive organic growth, we are also improving our inorganic growth momentum,” Schmitt said. “During the fourth quarter, we closed our previously announced acquisitions of CLW Delivery and Value Logistics, which contributed to our final-mile and intermodal results. And today we are pleased to announce an agreement in principle to sell the pool distribution business to Ten Oaks Group, which is expected to close in the next two weeks for total consideration of $20 million.”
The expedited freight segment reported that operating revenue for the fourth quarter increased 12.7% to $299.5 million from $265.8 million during the same time last year. The segment includes network operations, truckload and final-mile. Income from operations decreased 23.7% to $20.9 million from $27.4 during the prior year quarter.
Truckload revenue increased 4.4% to $54.8 million during the recent quarter from $52.5 million the prior year. Network revenue decreased 1.2% to $170 million from $172.1 million. Final-mile revenue increased 93.9% to $66.3 million from $34.2 million.
The intermodal segment reported operating revenue decreased 5.3% to $51.8 million from $54.7 million during the prior-year quarter. Income from operations for the segment decreased 35.8% to $3.4 million from $5.3 million during the same time last year.
Forward Air ranks No. 29 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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