Forward Air (NASDAQ: FWRD) reported net income from continuing operations of 60 cents per share Thursday after the market close, 3 cents ahead of the consensus estimate and 19 cents better than the first quarter of 2020.
Continuing operations exclude the high-frequency pool distribution segment, which was sold in February.
The Greeneville, Tennessee-based asset-light trucking and logistics company reported revenue of $362 million, an 18.5% year-over-year increase as well as a first-quarter record. Both revenue and earnings came in ahead of the company’s previously guided ranges of up 11% to 15% and 55 to 59 cents per share, respectively.
“Our growth strategies drove our record first quarter revenue, which came in above the high end of our guidance range. Business momentum continued during the quarter and accelerated in March, when our LTL business achieved an operating margin higher than in March of peak economy year 2018,” stated Tom Schmitt, chairman, president and CEO, in the press release.
The first-quarter guidance included 7 cents per share for expenses related to cybersecurity and shareholder engagement, following a cyberattack at the end of 2020 and a proxy battle with an activist investor. The actual cost was 20 cents per share.
Weather was also a 6-cent-per-share headwind in the quarter, although no analyst will exclude that as a one-time item from the final result.
“When adjusting for this approximate $0.26 total impact, we believe the underlying performance of our business during the first quarter greatly exceeded what we expected in our first quarter guidance,” Schmitt continued.
Given the outperformance and continuation of strong trucking fundamentals, management provided second-quarter guidance significantly above analysts’ current forecasts. Revenue is expected to increase between 35% and 40% year-over-year, implying $387 million at the midpoint compared to the current consensus estimate of $349 million.
Earnings per share were forecast to a range of 96 cents to $1 compared to the consensus estimate of 79 cents.
Expedited freight revenue increased 19.9% year-over-year to $304 million as tonnage jumped 14.3% and revenue per hundredweight excluding fuel surcharges was 3.3% higher. The division recorded 210 basis points of margin improvement posting an 8.1% operating margin.
Purchased transportation expense as a percentage of revenue increased 170 bps, but all other expense lines declined, including salaries, wages and benefits, which was down 160 bps.
The press release provided no commentary regarding demand or expenses.
Intermodal revenue was up 11.5% year-over-year to $59 million as drayage shipments increased 9% and revenue per shipment was flat. The division’s operating margin improved 60 bps to 7.7%.
Forward will hold a call to discuss first-quarter results on Friday at 9 a.m. EDT. Stay tuned to FreightWaves for continuing coverage.
Table: Forward’s key performance indicators