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Dec 31, 2023
Covenant Logistics Q4 2023 Earnings Report
Covenant Logistics Group's financial performance for Q4 2023 was announced, with earnings of $0.93 per diluted share and non-GAAP adjusted earnings of $1.07 per diluted share reported.
Key Takeaways
Covenant Logistics Group reported Q4 earnings of $0.93 per diluted share and adjusted earnings of $1.07 per diluted share. The asset-based segments contributed approximately 67% of total revenue and 74% of operating income. The company's 49% equity method investment with Transport Enterprise Leasing contributed pre-tax net income of $4.7 million.
Earnings per diluted share were reported at $0.93.
Non-GAAP adjusted earnings per diluted share were $1.07.
Asset-based segments contributed approximately 67% of total revenue and 74% of operating income.
Managed Freight segment experienced significant reductions in revenue and profitability.
Covenant Logistics
Covenant Logistics
Covenant Logistics Revenue by Segment
Revenue by Segment
Expedited - Truckload Revenue
CapyFin.comDedicated - Truckload Revenue
CapyFin.comManaged Freight Revenue
CapyFin.comWarehousing Revenue
CapyFin.com Forward Guidance
The company anticipates a continuation of difficult conditions where capacity continues to exit the market at a rate that yields steady but modest improvement. In the first quarter, the company expects revenue and earnings to decline, reflecting normal seasonality and temporary headwinds.
Positive Outlook
- The company's strategic plan is working.
- The company reallocated a significant amount of fixed assets away from underperforming and highly cyclical legacy operations toward acquiring three high-performing, more steady businesses.
- The result has been better margins, more stable earnings, and improved returns on capital compared with legacy operations during previous downturns.
- The company is optimistic about its ability to make incremental improvements.
- The company believes its more resilient operating model, together with the steps taken to reduce costs and inefficiencies, have positioned them well for another successful year.
Challenges Ahead
- The company does not see anything in the first half of the year that would indicate a near-term recovery of the freight market.
- The company anticipates a continuation of difficult conditions where capacity continues to exit the market at a rate that yields steady but modest improvement.
- In the first quarter, the company expects revenue and earnings to decline, reflecting normal seasonality
- The company expects temporary headwinds of severe inclement weather conditions
- The company expects year over year rate reductions in our Expedited segment and incremental costs associated with a large new customer startup within our Dedicated segment.
Revenue & Expenses
Visualization of income flow from segment revenue to net income