The Phoenix, Ariz.-based trucking and intermodal carrier, which recently announced a $6 billion merger with competitor Knight Transportation, saw first quarter net income tumble 83.7 percent year-over-year to $5.2 million.
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Swift Transportation’s net income tumbled 83.7 percent year-over-year to $5.2 million in first quarter 2017.
Swift Transportation saw its net profits plummet 83.7 percent year-over-year to $5.2 million in the first quarter of 2017, according to the company’s most recent financial statements.
The Phoenix, Ariz.-based trucking and intermodal carrier reported diluted earnings per share (EPS) of $0.04 for the quarter compared with $0.23 per share in the same 2016 period despite relatively stable revenues of $963.8 million, down just 0.4 percent from the previous year.
The company attributed the sluggish results primarily to settlement charges related to previously disclosed litigation in its refrigerated cargo segment, which negatively impacted EPS by $0.06, as well as continued excess capacity and lackluster demand growth in the truckload market.
Swift earlier this month announced a merger with fellow Phoenix-based trucking operator Knight Transportation that will create the industry’s largest full truckload provider.
The all-stock transaction, expected to close in third quarter 2017, subject to regulatory approval, will give the combined entity about 23,000 tractors, 77,000 trailers and 28,000 employees, and a market capitalization of roughly $6 billion, the companies said at the time.
“As we discussed on our mid-first quarter conference call, the truckload industry continues to be plagued with excess carrier capacity for the current demand environment prolonging the competitive pricing situation that existed throughout 2016,” Swift said in its quarterly letter to investors. “This challenging pricing environment, the impact of the more severe winter weather on maintenance and claims expense early in the quarter, the $11.7 million increase in legal reserves and the known headwinds of increased depreciation expense and lower gain on sale of equipment due to the soft used truck market all served as headwinds to our quarterly results.
“In an effort to offset these headwinds, our team remained committed to executing on our initiatives of increasing asset utilization, disciplined cost control, and improving the quality of freight within our network. We are proud of our team’s efforts as we drove improvements in our loaded miles per tractor per week and our Deadhead Percentage in each of our Truckload, Dedicated, and Refrigerated segments, and achieved a 300+ basis point improvement in the Intermodal operating ratio metrics,” it said.
“We are proud of this progress, especially in this less than ideal marketplace, and believe we are positioning ourselves to rebound when the market dynamics improve.”
Looking ahead to the second quarter, Swift said it is expecting diluted EPS of between $0.16 per share and $0.21 per share.
“We are cautiously optimistic about the back half of 2017, and look forward to a stronger operating environment in 2018 and beyond,” the company added.
