The holding company for Knight Transportation and Swift Transportation reported results for the first quarter of 2018 that reflect “progress” in achieving cost savings for the combined enterprise but also difficulty in finding enough drivers to meet increasing demand for service.
In reporting results of the combined Knight and Swift operations, Knight-Swift Transportation Holdings said it generated net income of $70.4 million on revenue of $1.27 billion for the three months ended March 31. In the same period a year ago, Knight Transportation alone earned $14.9 million on revenue of $271.2 million. Results for Swift in the first quarter of 2017 were not reported since it predates the merger of the two companies in September.
Dave Jackson, CEO of Knight-Swift Transportation Holdings, said the company’s performance was a marked improvement over a “difficult” first quarter a year ago.
“Freight demand was generally strong across our network on a better-than-seasonal basis throughout the quarter,” he said in a statement on April 25. “At the same time, given tight unemployment and our uncompromising commitment to safety, we continue to face perhaps the most difficult driver-sourcing challenge we have seen, which is a headwind on our unseated truck count and utilization metrics.”
Average truck counts in the first quarter were down 1.9% at Knight and 8% at Swift year-over-year, although sequentially there has been a slight increase in the Knight fleet and a slowdown in the decline at Swift, Jackson noted.
“We continue to focus on improving yield to support driver wages and improved profitability,” Jackson stated.
In breaking down results for the first quarter, Knight Transportation generated operating income of $40.8 million on revenue of $221.7 million. That compared with operating income of $20.3 million on revenue of $192.5 million in the same period a year ago.
Knight Logistics had operating income of $3.6 million on revenue of $65.8 million in the first quarter of 2018. That compared with earnings of $2.4 million on revenue of $52.5 million in 2017.
On March 16, Knight also acquired Abilene Motor Express, a truckload carrier based in Richmond, Va., with annual revenue of about $100 million. The company is expected to continue operating as a distinct branded business unit, much like a previous acquisition of Barr-Nunn Transportation, while officials work to achieve overall cost savings, Jackson said.
Results for Swift Transportation in the first quarter of 2018 is broken down into four components, with Swift Truckload reporting operating income of $34.8 million on revenue of $371.3 million, Swift Dedicated reporting operating income of $15.2 million on revenue of $135.3 million, Swift Refrigerated reporting operating income of $9.4 million on revenue of $179.9 million and Swift Intermodal reporting operating income of $3.8 million on revenue of $88.5 million.