The streak of truckload (TL) carriers outperforming second quarter earnings estimates continues with the nation’s largest carrier, Knight-Swift Transportation Holdings Inc. (NYSE: KNX) reporting adjusted earnings per share of $0.57, well ahead of the consensus estimate of $0.35.
The company excluded $10 million, $0.06 per share, in incremental cost associated with operating during the pandemic. Knight-Swift reported earnings per share of $0.47 on an unadjusted basis, a penny higher year-over-year.
“Our operational discipline, agility and cost-control culture enabled us to execute through the unprecedented challenges presented by the COVID-19 pandemic, which introduced a new source of volatility throughout the global markets during the first half of 2020,” stated the release. “Our diversified customer base, networks and unique brands positioned us to navigate a disrupted freight environment of unpredictable shipping volumes, shifts in pricing and continued challenges in driver sourcing. Looking across our portfolio of brands and freight networks, some of our operating segments performed consistently throughout the quarter, while others experienced more volatility in results.”
Like other TL carriers that have reported second quarter earnings, Knight-Swift noted freight demand “gradually strengthened” throughout the quarter and into July.
Consolidated revenue excluding fuel surcharges declined 11.1% year-over-year to $998 million with trucking revenue down 9.4% to $816 million. Revenue per tractor declined 6.5% with loaded miles down 4.9% and revenue per loaded mile excluding fuel down 1.7%. Revenue per loaded mile was flat compared to the first quarter. The carrier expects rate per mile to be positive in the third quarter.
The division posted an 85.5% adjusted operating ratio (OR), again excluding the incremental operating costs from COVID, 30 basis points better than the year-ago period. Knight’s OR was 84% with Swift posting an 85.3% OR.
The company reinstated full-year 2020 earnings guidance. It now expects adjusted earnings per share of $2.15 to $2.30, ahead of the original guidance of $2.00 to $2.15 that was pulled over COVID-related uncertainty last quarter.
Shares of KNX are up nearly 2% in early trading.
The company doesn’t hold a conference call. Stay tuned to FreightWaves for more coverage on Knight-Swift’s earnings report.
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