Swift Profits Plummet 30%, Revenues Fall in Three of Four Divisions
Swift Transportation profits plunged 30% in the fourth quarter following drops in revenue in every division except for the dedicated contract carriage.
Net income was $50.4 million for the quarter, or 38 cents per share. One year ago, the Phoenix-based carrier generated $72.5 million, or 51 cents. Full-year profits declined 24% to $149.3 million, or $1.10, compared with $197.6 million, or $1.38, one year ago.
Revenue dropped at a smaller 4.7% rate to $1 billion versus the same three-month period in 2015 and fell by the same rate on an annual basis to $4 billion.
“The fourth quarter capped a very challenging 2016, as rising fuel prices and a weak used truck market compounded the negative impact of the pricing and freight volume headwinds prevalent within the market,” the company wrote in a letter to investors. “Our results for the fourth quarter were further impacted by higher-than-expected insurance and claims expense related to development on certain prior and current year claims.”
The Swift Truckload unit’s revenue for the quarter dropped 6.5% to $521.2 million and total loaded miles driven decreased 3.8% year-over-year. Swift Dedicated revenue grew 6.7% year-over-year to $257.3 million and weekly revenue per tractor improved 6.5% year-over-year. Swift Intermodal revenue declined 5.4% to $95.3 million in the quarter and Swift Refrigerated revenue dropped 10% to $84.5 million.
“Our organization continued to work diligently throughout the quarter to mitigate the financial impact of these factors, by remaining disciplined to our countermeasures to increase the utilization of our assets, ensuring available trucks are paired with high-quality freight, and further implementing numerous cost-control initiatives,” the company wrote. “Although this quarter’s financial results are not as strong as we would like to see, we are confident that this dedication, along with these countermeasures, has helped offset a portion of the market headwinds mentioned above.”
Swift, which ranks No. 6 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers, fell a penny short on earnings for the quarter and a nickel for the full year, based on a survey of analysts from Bloomberg News.
