Fourth Quarter 2024 Highlights (all metrics compared to
fourth quarter 2023)
- Total revenues of $754.7 million, down 8%
- Operating income of $13.4 million, down 65%; non-GAAP adjusted
operating income of $12.2 million, down 69%
- Operating margin of 1.8%, down 280 basis points; non-GAAP
adjusted operating margin of 1.6%, down 320 basis points
- Diluted EPS of $0.19, down 48%; non-GAAP adjusted diluted EPS
of $0.08, down 80%
2024 Highlights (all metrics compared to 2023)
- Total revenues of $3.03 billion, down 8%
- Operating income of $66.1 million, down 63%; non-GAAP adjusted
operating income of $73.7 million, down 61%
- Operating margin of 2.2%, down 320 basis points; non-GAAP
adjusted operating margin of 2.4%, down 340 basis points
- Diluted EPS of $0.55, down 69%; non-GAAP adjusted diluted EPS
of $0.53, down 73%
Werner Enterprises, Inc. (Nasdaq: WERN), a premier
transportation and logistics provider, today reported results for
the fourth quarter and year ended December 31, 2024.
“The fourth quarter included several puts and takes that are
more one-time in nature. While the freight market continues to
present challenges, fourth quarter provided early signs of an
improving environment. One-Way revenue per total mile increased
year-over-year for the second consecutive quarter. Peak season was
better than expected with peak volumes that were two times last
year at higher rates. Dedicated average fleet size grew
sequentially, and we are proud of the numerous Carrier of the Year
awards during 2024 from Dedicated customers. Our Logistics division
reported adjusted operating income that improved sequentially and
represented the best quarter of the year,” said Derek Leathers,
Chairman and CEO. “While our fourth quarter insurance expense was
elevated due to unfavorable development on large dollar claims, our
safety metrics remain near record low levels. During this downturn,
we have focused on controlling what we can by investing in
ourselves and making strategic decisions that position us favorably
for creating long-term value for our shareholders as conditions
improve.”
Total revenues for the quarter were $754.7 million, a decrease
of $67.3 million compared to the prior-year quarter, due to a $52.8
million, or 9%, decrease in Truckload Transportation Services
(“TTS”) revenues and a decline in Logistics revenues of $13.8
million, or 6%. A portion of the TTS revenue decline was due to
$27.1 million lower fuel surcharge revenues. Net of trucking fuel
surcharge revenues, consolidated total revenues decreased $40.2
million, or 5%, during the quarter.
Operating income of $13.4 million decreased $24.6 million, or
65%, while operating margin of 1.8% decreased 280 basis points. On
a non-GAAP basis, adjusted operating income of $12.2 million
decreased $27.0 million, or 69%. Adjusted operating margin of 1.6%
declined 320 basis points from 4.8% for the same quarter last
year.
During the quarter, we incurred $49.5 million of insurance and
claims expense, of which $19 million resulted from unfavorable
development on large dollar claims, contributing 250 basis points
of the year-over-year decrease in adjusted operating margin, and
$0.22 of negative impact to non-GAAP adjusted diluted EPS. This is
a reflection of the ongoing unprecedented rise in verdicts and
litigation settlements across the industry, particularly for larger
carriers. In contrast to these trends, in 2024 we produced near
20-year record lows in U.S. Department of Transportation
preventable accidents per million miles, trailing only 2023.
TTS operating income and adjusted operating income both
decreased $22.6 million, largely driven by the $19 million of
unfavorable claims development during the fourth quarter. Logistics
operating income decreased $3.3 million and adjusted operating
income decreased $0.6 million. Corporate and Other (including
driving schools) operating income was $0.4 million compared to $1.0
million operating loss in prior year.
Net interest expense of $9.5 million increased $2.2 million
primarily due to the impact of replacing lower-cost debt and
interest rate swaps with higher-cost debt and interest rate swaps
upon certain maturities in the second quarter. The effective income
tax rate during the quarter decreased to 7.3%, compared to 23.1% in
fourth quarter 2023 driven by certain discrete return-to-provision
adjustments for a prior year.
During fourth quarter 2024, we had gains on our strategic
investments of $8.7 million, or $0.10 per share, compared to losses
of $0.3 million in fourth quarter 2023. Consistent with prior
reporting, increases or decreases to the values of these strategic
investments are adjusted out for determining non-GAAP adjusted net
income and non-GAAP adjusted earnings per share.
Net income attributable to Werner of $11.9 million decreased
50%. On a non-GAAP basis, adjusted net income attributable to
Werner of $4.7 million decreased 81%. Diluted EPS of $0.19
decreased 48%. On a non-GAAP basis, adjusted diluted EPS of $0.08
decreased 80%, including $19 million of unfavorable claims
development during the quarter.
Key Consolidated Financial
Metrics
Three Months Ended December
31,
Year Ended December 31,
(In thousands, except per share
amounts)
2024
2023
Y/Y Change
2024
2023
Y/Y Change
Total revenues
$
754,679
$
821,945
(8
)%
$
3,030,258
$
3,283,499
(8
)%
Truckload Transportation Services
revenues
$
527,295
$
580,093
(9
)%
$
2,138,293
$
2,310,810
(7
)%
Werner Logistics revenues
$
213,169
$
226,963
(6
)%
$
831,337
$
910,433
(9
)%
Operating income
$
13,354
$
37,932
(65
)%
$
66,148
$
176,416
(63
)%
Operating margin
1.8
%
4.6
%
(280) bps
2.2
%
5.4
%
(320) bps
Net income attributable to Werner
$
11,891
$
23,573
(50
)%
$
34,233
$
112,382
(70
)%
Diluted earnings per share
$
0.19
$
0.37
(48
)%
$
0.55
$
1.76
(69
)%
Adjusted operating income (1)
$
12,247
$
39,206
(69
)%
$
73,713
$
189,705
(61
)%
Adjusted operating margin (1)
1.6
%
4.8
%
(320) bps
2.4
%
5.8
%
(340) bps
Adjusted net income attributable to Werner
(1)
$
4,747
$
24,639
(81
)%
$
33,080
$
122,721
(73
)%
Adjusted diluted earnings per share
(1)
$
0.08
$
0.39
(80
)%
$
0.53
$
1.93
(73
)%
(1) See attached Reconciliation of
Non-GAAP Financial Measures - Consolidated.
Truckload Transportation Services (TTS) Segment
- Revenues of $527.3 million decreased $52.8 million; trucking
revenues, net of fuel surcharge, decreased 6% year over year
- Operating income of $11.7 million decreased $22.6 million;
non-GAAP adjusted operating income of $14.6 million decreased $22.6
million due largely to $19 million of unfavorable claims
development in the quarter, a smaller fleet size, and lower gains
on the sale of property and equipment (down 55%)
- Operating margin of 2.2% decreased 370 basis points from 5.9%;
non-GAAP adjusted operating margin, net of fuel surcharge, of 3.1%
decreased 440 basis points from 7.5%
- Average segment trucks in service totaled 7,495, a decrease of
673 trucks year over year, or 8.2%
- Dedicated unit trucks at quarter end totaled 4,840, or 65% of
the total TTS segment fleet, compared to 5,265 trucks, or 66%, a
year ago
- Average revenues per truck per week, net of fuel surcharge,
increased 2.5% for TTS
During fourth quarter 2024, Dedicated experienced net reduction
in average trucks, down 7.7% year over year and up 27 trucks, or
0.1%, sequentially. Quarter-end fleet size was down 8.1% year over
year and down 1.3% sequentially. Dedicated average revenues per
truck per week, net of fuel surcharge, increased 1.1% year over
year. Despite a highly competitive environment, pipeline
opportunities are strong and customer retention is over 90%.
One-Way Truckload volume was seasonally stronger than prior year
with more than double the number of premium-rated peak shipments
along with year-over-year improvement in rate. One-Way revenues per
total mile, net of fuel surcharge, increased 3.3% year over year.
Despite a 9.2% decline in One-Way average trucks, One-Way Truckload
miles were only down 7.6%, due to the impact of a 1.7% increase in
miles per truck per week, the seventh consecutive quarter of
improvement.
Key Truckload Transportation Services
Segment Financial Metrics
Three Months Ended December
31,
Year Ended December 31,
(In thousands)
2024
2023
Y/Y Change
2024
2023
Y/Y Change
Trucking revenues, net of fuel
surcharge
$
458,698
$
487,408
(6
)%
$
1,836,581
$
1,949,445
(6
)%
Trucking fuel surcharge revenues
57,565
84,675
(32
)%
263,263
332,388
(21
)%
Non-trucking and other revenues
11,032
8,010
38
%
38,449
28,977
33
%
Total revenues
$
527,295
$
580,093
(9
)%
$
2,138,293
$
2,310,810
(7
)%
Operating income
$
11,721
$
34,339
(66
)%
$
75,166
$
169,330
(56
)%
Operating margin
2.2
%
5.9
%
(370) bps
3.5
%
7.3
%
(380) bps
Operating ratio
97.8
%
94.1
%
370 bps
96.5
%
92.7
%
380 bps
Adjusted operating income (1)
$
14,601
$
37,165
(61
)%
$
85,102
$
180,453
(53
)%
Adjusted operating margin (1)
2.8
%
6.4
%
(360) bps
4.0
%
7.8
%
(380) bps
Adjusted operating margin, net of fuel
surcharge (1)
3.1
%
7.5
%
(440) bps
4.5
%
9.1
%
(460) bps
Adjusted operating ratio (1)
97.2
%
93.6
%
360 bps
96.0
%
92.2
%
380 bps
Adjusted operating ratio, net of fuel
surcharge (1)
96.9
%
92.5
%
440 bps
95.5
%
90.9
%
460 bps
(1) See attached Reconciliation of
Non-GAAP Financial Measures - Truckload Transportation Services
(TTS) Segment.
Werner Logistics Segment
- Revenues of $213.2 million decreased $13.8 million, or 6%
- Operating income of $1.2 million decreased $3.3 million;
non-GAAP adjusted operating income of $2.4 million decreased $0.6
million
- Operating margin of 0.6% decreased 140 basis points from 2.0%;
non-GAAP adjusted operating margin of 1.1% decreased 20 basis
points from 1.3%
Truckload Logistics revenues (76% of Logistics revenues)
decreased $11.0 million, or 6%, driven by a decline in revenue per
shipment and a decrease in shipments. Brokerage volumes decreased
year over year while Power Only volume increased over 21%, marking
the eighth consecutive quarter of Power Only volume growth.
Intermodal revenues (13% of Logistics revenues) increased $0.5
million, or 2%, due to an increase in shipments, partially offset
by lower revenue per shipment year over year.
Final Mile revenues (11% of Logistics revenues) decreased $3.3
million, or 12%, due to lower volumes in furniture and appliance
vertical.
Logistics operating income decreased $3.3 million and adjusted
operating income decreased $0.6 million year over year in fourth
quarter 2024. While Truckload Logistics continues to operate in an
ongoing competitive environment, fourth quarter was our highest
operating income and operating margin quarter since 2023 driven by
sequentially higher revenue combined with further cost savings
actions taken during the quarter.
Key Werner Logistics Segment Financial
Metrics
Three Months Ended December
31,
Year Ended December 31,
(In thousands)
2024
2023
Y/Y Change
2024
2023
Y/Y Change
Total revenues
$
213,169
$
226,963
(6
)%
$
831,337
$
910,433
(9
)%
Operating expenses:
Purchased transportation expense
181,735
193,132
(6
)%
707,493
761,948
(7
)%
Other operating expenses
30,191
29,256
3
%
124,725
132,606
(6
)%
Total operating expenses
211,926
222,388
(5
)%
832,218
894,554
(7
)%
Operating income (loss)
$
1,243
$
4,575
(73
)%
$
(881
)
$
15,879
(106
)%
Operating margin
0.6
%
2.0
%
(140) bps
(0.1
%)
1.7
%
(180) bps
Adjusted operating income (1)
$
2,391
$
3,023
(21
)%
$
3,713
$
18,045
(79
)%
Adjusted operating margin (1)
1.1
%
1.3
%
(20) bps
0.4
%
2.0
%
(160) bps
(1) See attached Reconciliation of
Non-GAAP Financial Measures - Werner Logistics Segment.
Cash Flow and Capital Allocation
Cash flow from operations in fourth quarter 2024 was $71.0
million compared to $118.3 million in fourth quarter 2023, a
decrease of 40%.
Net capital expenditures in fourth quarter 2024 were $28.8
million compared to $34.5 million in fourth quarter 2023, a
decrease of 17%. We continue to prioritize business reinvestment in
safe and modern equipment, including trucks and trailers, as well
as in technology, our terminal network and our talent. The average
ages of our truck and trailer fleets were 2.1 years and 5.3 years,
respectively, as of December 31, 2024. Maintaining an
industry-leading low-age, modern fleet improves our driver
experience and results in more effective equipment maintenance,
safety and fuel efficiency.
Gains on sales of property and equipment in fourth quarter 2024
were $6.5 million, or $0.07 per share, compared to $3.1 million, or
$0.04 per share, in fourth quarter 2023. Gains in fourth quarter
2024 included $5.1 million gain from selling a parcel of real
estate, which is adjusted out of income for purposes of the
non-GAAP measures. Excluding the gain on real estate, gains on sale
of used equipment were down year-over-year by $1.7 million, or 55%,
driven by a change in the mix of equipment sold. We sold fewer
trucks compared to prior year, but at modestly improved average
unit gains. Gains on sales of property and equipment are reflected
as a reduction of other operating expenses in our income
statement.
We did not repurchase shares of our common stock in fourth
quarter 2024. As of December 31, 2024, we had 3.9 million shares
remaining under our share repurchase authorization.
As of December 31, 2024, we had $41 million of cash and cash
equivalents and $1.5 billion of stockholders’ equity. Total debt
outstanding was $650 million at December 31, 2024, flat year over
year. After considering letters of credit issued, we had available
liquidity consisting of cash and cash equivalents and available
borrowing capacity as of December 31, 2024 of $460 million.
Introducing 2025 Guidance
2024 Guidance (as of
10/29/24)
2024 Actual (as of
12/31/24)
2025 Guidance (as of
2/6/25)
TTS truck count from beginning of
year to end of year
(8)% to (6)% (annual)
(7)% (2024)
1% to 5% (annual)
Net capital expenditures
$240M to $260M (annual)
$235M (2024)
$185M to $235M (annual)
TTS Guidance
Dedicated RPTPW* growth
0% to 3% (annual)
1.1% (2024)
0% to 3% (annual)
One-Way Truckload RPTM*
growth
0% to 3% (4Q24 vs. 4Q23)
3.3% (4Q24 vs. 4Q23)
1% to 4% (1H25 vs. 1H24)
Assumptions
Effective income tax rate
25.5% to 26.5% (annual)
21.0% (2024)
25.0% to 26.0% (annual)
* Net of fuel surcharge
revenues
Call Information
Werner Enterprises, Inc. will conduct a conference call to
discuss fourth quarter 2024 earnings today beginning at 4:00 p.m.
CT. The news release, live webcast of the earnings conference call,
and accompanying slide presentation will be available at werner.com
in the “Investors” section under “News & Events” and then
“Events Calendar.” To participate in the conference call, please
dial (844) 701-1165 (domestic) or (412) 317-5498 (international).
Please mention to the operator that you are dialing in for the
Werner Enterprises call.
A replay of the conference call will be available on February 6,
2025 at approximately 6:00 p.m. CT through March 6, 2025 by dialing
(877) 344-7529 (domestic) or (412) 317-0088 (international) and
using the access code 6993511. A replay of the webcast will also be
available at werner.com in the “Investors” section under “News
& Events” and then “Events Calendar.”
About Werner Enterprises
Werner Enterprises, Inc. (Nasdaq: WERN) delivers superior
truckload transportation and logistics services to customers across
the United States, Mexico and Canada. With 2024 revenues of $3.0
billion, an industry-leading modern truck and trailer fleet, nearly
13,000 talented associates and our innovative Werner EDGE®
technology, we are an essential solutions provider for customers
who value the integrity of their supply chain and require safe and
exceptional on-time service. Werner® provides Dedicated and One-Way
Truckload services as well as Logistics services that include
truckload brokerage, freight management, intermodal and final mile.
Werner embraces inclusion as a core value and manages key risks and
opportunities through a balanced sustainability strategy.
This press release may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, as amended. Such
forward-looking statements are based on information presently
available to the Company’s management and are current only as of
the date made. Actual results could also differ materially from
those anticipated as a result of a number of factors, including,
but not limited to, those discussed in the Company’s latest
available Annual Report on Form 10-K and any subsequently filed
Quarterly Reports on Form 10-Q.
For those reasons, undue reliance should not be placed on any
forward-looking statement. The Company assumes no duty or
obligation to update or revise any forward-looking statement,
although it may do so from time to time as management believes is
warranted or as may be required by applicable securities law. Any
such updates or revisions may be made by filing reports with the
U.S. Securities and Exchange Commission (“SEC”), through the
issuance of press releases or by other methods of public
disclosure.
Consolidated Financial
Information
INCOME STATEMENT
(Unaudited)
(In thousands, except per share
amounts)
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
$
%
$
%
$
%
$
%
Operating revenues
$
754,679
100.0
$
821,945
100.0
$
3,030,258
100.0
$
3,283,499
100.0
Operating expenses:
Salaries, wages and benefits
251,385
33.3
269,816
32.8
1,034,877
34.1
1,072,558
32.7
Fuel
60,907
8.1
85,478
10.4
275,413
9.1
345,001
10.5
Supplies and maintenance
60,750
8.0
63,124
7.7
246,061
8.1
256,494
7.8
Taxes and licenses
23,007
3.0
25,999
3.2
97,230
3.2
102,684
3.1
Insurance and claims
49,461
6.6
33,964
4.1
145,398
4.8
138,516
4.2
Depreciation and amortization
71,879
9.5
75,712
9.2
290,405
9.6
299,509
9.1
Rent and purchased transportation
218,861
29.0
224,418
27.3
844,870
27.9
886,284
27.0
Communications and utilities
4,176
0.6
4,523
0.6
17,195
0.6
18,480
0.6
Other
899
0.1
979
0.1
12,661
0.4
(12,443
)
(0.4
)
Total operating expenses
741,325
98.2
784,013
95.4
2,964,110
97.8
3,107,083
94.6
Operating income
13,354
1.8
37,932
4.6
66,148
2.2
176,416
5.4
Other expense (income):
Interest expense
11,128
1.5
8,819
1.1
39,212
1.3
33,535
1.0
Interest income
(1,593
)
(0.2
)
(1,523
)
(0.2
)
(6,898
)
(0.2
)
(6,701
)
(0.2
)
Loss (gain) on investments in equity
securities, net
(8,157
)
(1.1
)
242
—
(7,930
)
(0.3
)
278
—
Loss (earnings) from equity method
investment
(535
)
(0.1
)
92
—
(556
)
—
1,046
0.1
Other
19
—
100
—
(162
)
—
477
—
Total other expense, net
862
0.1
7,730
0.9
23,666
0.8
28,635
0.9
Income before income taxes
12,492
1.7
30,202
3.7
42,482
1.4
147,781
4.5
Income tax expense
910
0.1
6,970
0.9
8,912
0.3
35,491
1.1
Net income
11,582
1.6
23,232
2.8
33,570
1.1
112,290
3.4
Net loss attributable to noncontrolling
interest
309
—
341
0.1
663
—
92
—
Net income attributable to Werner
$
11,891
1.6
$
23,573
2.9
$
34,233
1.1
$
112,382
3.4
Diluted shares outstanding
62,079
63,780
62,662
63,718
Diluted earnings per share
$
0.19
$
0.37
$
0.55
$
1.76
CONDENSED BALANCE SHEET
(In thousands, except share
amounts)
December 31, 2024
December 31, 2023
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
40,752
$
61,723
Accounts receivable, trade, less allowance
of $7,169 and $9,337, respectively
391,684
444,944
Other receivables
26,137
25,479
Inventories and supplies
14,183
18,077
Prepaid expenses (1)
53,690
54,333
Other current assets (1)
15,327
30,072
Total current assets
541,773
634,628
Property and equipment
2,941,495
2,951,654
Less – accumulated depreciation
1,007,259
978,698
Property and equipment, net
1,934,236
1,972,956
Goodwill
129,104
129,104
Intangible assets, net
76,407
86,477
Other non-current assets (2)
370,717
334,771
Total assets
$
3,052,237
$
3,157,936
LIABILITIES, TEMPORARY EQUITY AND
STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
112,429
$
135,990
Current portion of long-term debt
20,000
2,500
Insurance and claims accruals
93,710
81,794
Accrued payroll
54,560
50,549
Accrued expenses
18,745
30,282
Other current liabilities
56,305
29,470
Total current liabilities
355,749
330,585
Long-term debt, net of current portion
630,000
646,250
Other long-term liabilities
66,173
54,275
Insurance and claims accruals, net of
current portion (2)
236,923
239,700
Deferred income taxes
269,516
320,180
Total liabilities
1,558,361
1,590,990
Temporary equity - redeemable
noncontrolling interest
37,944
38,607
Stockholders’ equity:
Common stock, $.01 par value, 200,000,000
shares authorized; 80,533,536 shares issued; 61,850,434 and
63,444,681 shares outstanding, respectively
805
805
Paid-in capital
137,889
134,894
Retained earnings
1,952,775
1,953,385
Accumulated other comprehensive loss
(18,437
)
(9,684
)
Treasury stock, at cost; 18,683,102 and
17,088,855 shares, respectively
(617,100
)
(551,061
)
Total stockholders’ equity
1,455,932
1,528,339
Total liabilities, temporary equity and
stockholders’ equity
$
3,052,237
$
3,157,936
(1) The balance sheet caption formerly
known as “prepaid taxes, licenses and permits” has been renamed
“prepaid expenses.” In addition, $37.8 million of other prepaid
expenses have been reclassified from other current assets to
prepaid expenses on the condensed balance sheet as of December 31,
2023. This reclassification was made to conform to the current
financial statement presentation.
(2) Under the terms of our insurance
policies, we are the primary obligor of the damage award in a
previously disclosed adverse jury verdict, and as such, we have
recorded a $79.2 million receivable from our third-party insurance
providers in other non-current assets and a corresponding liability
of the same amount in the long-term portion of insurance and claims
accruals in the unaudited condensed balance sheets as of December
31, 2024 and 2023.
SUPPLEMENTAL INFORMATION
(Unaudited)
(In thousands)
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Capital expenditures, net
$
28,782
$
34,537
$
234,887
$
408,698
Cash flow from operations
$
71,034
$
118,347
$
329,734
$
474,366
Return on assets (annualized)
1.5
%
2.9
%
1.1
%
3.6
%
Return on equity (annualized)
3.1
%
6.0
%
2.2
%
7.3
%
Segment Financial and Operating
Statistics Information
SEGMENT INFORMATION
(Unaudited)
(In thousands)
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Revenues
Truckload Transportation Services
$
527,295
$
580,093
$
2,138,293
$
2,310,810
Werner Logistics
213,169
226,963
831,337
910,433
Other (1)
17,338
18,974
72,456
78,063
Corporate
724
420
2,601
1,883
Subtotal
758,526
826,450
3,044,687
3,301,189
Inter-segment eliminations (2)
(3,847
)
(4,505
)
(14,429
)
(17,690
)
Total
$
754,679
$
821,945
$
3,030,258
$
3,283,499
Operating Income
(Loss)
Truckload Transportation Services
$
11,721
$
34,339
$
75,166
$
169,330
Werner Logistics
1,243
4,575
(881
)
15,879
Other (1)
(1,319
)
(244
)
(3,474
)
69
Corporate
1,709
(738
)
(4,663
)
(8,862
)
Total
$
13,354
$
37,932
$
66,148
$
176,416
(1) Other includes our driver training
schools, transportation-related activities such as third-party
equipment maintenance and equipment leasing, and other business
activities.
(2) Inter-segment eliminations represent
transactions between reporting segments that are eliminated in
consolidation.
OPERATING STATISTICS BY
SEGMENT
(Unaudited)
Three Months Ended December
31,
Year Ended December 31,
2024
2023
% Chg
2024
2023
% Chg
Truckload
Transportation Services segment
Average trucks in service
7,495
8,168
(8.2
)%
7,619
8,326
(8.5
)%
Average revenues per truck per week
(1)
$
4,707
$
4,590
2.5
%
$
4,635
$
4,502
3.0
%
Total trucks (at quarter end)
Company
7,155
7,740
(7.6
)%
7,155
7,740
(7.6
)%
Independent contractor
295
260
13.5
%
295
260
13.5
%
Total trucks
7,450
8,000
(6.9
)%
7,450
8,000
(6.9
)%
Total trailers (at quarter end)
25,495
27,850
(8.5
)%
25,495
27,850
(8.5
)%
One-Way
Truckload
Trucking revenues, net of fuel surcharge
(in 000’s)
$
169,901
$
178,118
(4.6
)%
$
672,598
$
713,762
(5.8
)%
Average trucks in service
2,659
2,929
(9.2
)%
2,695
3,042
(11.4
)%
Total trucks (at quarter end)
2,610
2,735
(4.6
)%
2,610
2,735
(4.6
)%
Average percentage of empty miles
16.11
%
14.92
%
8.0
%
15.25
%
14.36
%
6.2
%
Average revenues per truck per week
(1)
$
4,915
$
4,678
5.1
%
$
4,799
$
4,512
6.4
%
Average % change YOY in revenues per total
mile (1)
3.3
%
(8.6
)%
(1.2
)%
(5.5
)%
Average % change YOY in total miles per
truck per week
1.7
%
8.7
%
7.6
%
2.2
%
Average completed trip length in miles
(loaded)
571
594
(3.9
)%
582
595
(2.2
)%
Dedicated
Trucking revenues, net of fuel surcharge
(in 000’s)
$
288,797
$
309,290
(6.6
)%
$
1,163,983
$
1,235,683
(5.8
)%
Average trucks in service
4,836
5,239
(7.7
)%
4,924
5,284
(6.8
)%
Total trucks (at quarter end)
4,840
5,265
(8.1
)%
4,840
5,265
(8.1
)%
Average revenues per truck per week
(1)
$
4,593
$
4,541
1.1
%
$
4,546
$
4,496
1.1
%
Werner Logistics
segment
Average trucks in service
22
39
(43.6
)%
22
37
(40.5
)%
Total trucks (at quarter end)
18
35
(48.6
)%
18
35
(48.6
)%
Total trailers (at quarter end)
3,170
2,960
7.1
%
3,170
2,960
7.1
%
Total containers (at quarter end)
200
—
N/A
200
—
N/A
(1) Net of fuel surcharge revenues
Non-GAAP Financial Measures and Reconciliations
To supplement our financial results presented in accordance with
generally accepted accounting principles in the United States of
America (“GAAP”), we provide certain non-GAAP financial measures as
defined by the SEC Regulation G, including non-GAAP adjusted
operating income; non-GAAP adjusted operating margin; non-GAAP
adjusted operating margin, net of fuel surcharge; non-GAAP adjusted
net income attributable to Werner; non-GAAP adjusted diluted
earnings per share; non-GAAP adjusted operating revenues, net of
fuel surcharge; non-GAAP adjusted operating revenues, less
purchased transportation expense; non-GAAP adjusted operating
expenses; non-GAAP adjusted operating expenses, net of fuel
surcharge; non-GAAP adjusted operating ratio; and non-GAAP adjusted
operating ratio, net of fuel surcharge. We believe these non-GAAP
financial measures provide a more useful comparison of our
performance from period to period because they exclude the effect
of items that, in our opinion, do not reflect our core operating
performance. Our non-GAAP financial measures are not meant to be
considered in isolation or as substitutes for their comparable GAAP
measures and should be read only in conjunction with our
consolidated financial statements prepared in accordance with GAAP.
There are limitations to using non-GAAP financial measures.
Although we believe that they improve comparability in analyzing
our period to period performance, they could limit comparability to
other companies in our industry if those companies define these
measures differently. Because of these limitations, our non-GAAP
financial measures should not be considered measures of income
generated by our business. Management compensates for these
limitations by primarily relying on GAAP results and using non-GAAP
financial measures on a supplemental basis.
The following tables present reconciliations of each non-GAAP
financial measure to its most directly comparable GAAP financial
measure as required by SEC Regulation G. In addition, information
regarding each of the excluded items as well as our reasons for
excluding them from our non-GAAP results is provided below.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES – CONSOLIDATED
(unaudited)
(In thousands, except per share
amounts)
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Non-GAAP Adjusted Operating Income and
Non-GAAP Adjusted Operating Margin
(1)
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
Operating income and operating margin –
(GAAP)
$
13,354
1.8
%
$
37,932
4.6
%
$
66,148
2.2
%
$
176,416
5.4
%
Non-GAAP adjustments:
Insurance and claims (2)
1,511
0.2
%
1,457
0.2
%
4,460
0.1
%
5,664
0.2
%
Amortization of intangible assets (3)
2,517
0.3
%
2,517
0.3
%
10,070
0.3
%
10,325
0.3
%
Gain on sale of real estate (4)
(5,135
)
(0.7
)%
—
—
%
(6,965
)
(0.2
)%
—
—
%
Contingent consideration adjustments
(5)
—
—
%
(2,700
)
(0.3
)%
—
—
%
(2,700
)
(0.1
)%
Non-GAAP adjusted operating income and
non-GAAP adjusted operating margin
$
12,247
1.6
%
$
39,206
4.8
%
$
73,713
2.4
%
$
189,705
5.8
%
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Non-GAAP Adjusted Net Income
Attributable to Werner and Non-GAAP Adjusted Diluted EPS (1)
$
Diluted EPS
$
Diluted EPS
$
Diluted EPS
$
Diluted EPS
Net income attributable to Werner and
diluted EPS – (GAAP)
$
11,891
$
0.19
$
23,573
$
0.37
$
34,233
$
0.55
$
112,382
$
1.76
Non-GAAP adjustments:
Insurance and claims (2)
1,511
0.02
1,457
0.02
4,460
0.07
5,664
0.09
Amortization of intangible assets, net of
amount attributable to noncontrolling interest (3)
2,345
0.04
2,345
0.04
9,382
0.15
9,637
0.15
Gain on sale of real estate (4)
(5,135
)
(0.08
)
—
—
(6,965
)
(0.11
)
—
—
Contingent consideration adjustments
(5)
—
—
(2,700
)
(0.04
)
—
—
(2,700
)
(0.04
)
Loss (gain) on investments in equity
securities, net (6)
(8,157
)
(0.13
)
242
—
(7,930
)
(0.13
)
278
0.01
Loss (earnings) from equity method
investment (7)
(535
)
(0.01
)
92
—
(556
)
(0.01
)
1,046
0.02
Income tax effect of above adjustments
(8)
2,827
0.05
(370
)
—
456
0.01
(3,586
)
(0.06
)
Non-GAAP adjusted net income attributable
to Werner and non-GAAP adjusted diluted EPS
$
4,747
$
0.08
$
24,639
$
0.39
$
33,080
$
0.53
$
122,721
$
1.93
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Non-GAAP Adjusted
Operating Revenues, Net of Fuel Surcharge (1)
$
$
$
$
Operating revenues – (GAAP)
$
754,679
$
821,945
$
3,030,258
$
3,283,499
Non-GAAP adjustment:
Trucking fuel surcharge (9)
(57,565
)
(84,675
)
(263,263
)
(332,388
)
Non-GAAP Operating revenues, net of fuel
surcharge
$
697,114
$
737,270
$
2,766,995
$
2,951,111
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES – TRUCKLOAD TRANSPORTATION SERVICES (TTS)
SEGMENT
(unaudited)
(In thousands)
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Non-GAAP Adjusted Operating Income
and Non-GAAP Adjusted Operating
Margin (1)
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
Operating income and operating margin –
(GAAP)
$
11,721
2.2
%
$
34,339
5.9
%
$
75,166
3.5
%
$
169,330
7.3
%
Non-GAAP adjustments:
Insurance and claims (2)
1,511
0.3
%
1,457
0.3
%
4,460
0.2
%
5,664
0.3
%
Amortization of intangible assets (3)
1,369
0.3
%
1,369
0.2
%
5,476
0.3
%
5,459
0.2
%
Non-GAAP adjusted operating income and
non-GAAP adjusted operating margin
$
14,601
2.8
%
$
37,165
6.4
%
$
85,102
4.0
%
$
180,453
7.8
%
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Non-GAAP Adjusted Operating Expenses
and Non-GAAP Adjusted Operating
Ratio (1)
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
Operating expenses and operating ratio –
(GAAP)
$
515,574
97.8
%
$
545,754
94.1
%
$
2,063,127
96.5
%
$
2,141,480
92.7
%
Non-GAAP adjustments:
Insurance and claims (2)
(1,511
)
(0.3
)%
(1,457
)
(0.3
)%
(4,460
)
(0.2
)%
(5,664
)
(0.3
)%
Amortization of intangible assets (3)
(1,369
)
(0.3
)%
(1,369
)
(0.2
)%
(5,476
)
(0.3
)%
(5,459
)
(0.2
)%
Non-GAAP adjusted operating expenses and
non-GAAP adjusted operating ratio
$
512,694
97.2
%
$
542,928
93.6
%
$
2,053,191
96.0
%
$
2,130,357
92.2
%
Three Months Ended December
31,
Year Ended December 31,
Non-GAAP Adjusted Operating Revenues,
Net of Fuel Surcharge; Non-GAAP Adjusted Operating Expenses,
Net of Fuel Surcharge; Non-GAAP Adjusted Operating Margin,
Net of Fuel Surcharge; and Non-GAAP
Adjusted Operating Ratio, Net of Fuel Surcharge (1)
2024
2023
2024
2023
$
$
$
$
Operating revenues – (GAAP)
$
527,295
$
580,093
$
2,138,293
$
2,310,810
Less: Trucking fuel surcharge (9)
(57,565
)
(84,675
)
(263,263
)
(332,388
)
Operating revenues, net of fuel surcharge
– (Non-GAAP)
469,730
495,418
1,875,030
1,978,422
Operating expenses – (GAAP)
515,574
545,754
2,063,127
2,141,480
Non-GAAP adjustments:
Trucking fuel surcharge (9)
(57,565
)
(84,675
)
(263,263
)
(332,388
)
Insurance and claims (2)
(1,511
)
(1,457
)
(4,460
)
(5,664
)
Amortization of intangible assets (3)
(1,369
)
(1,369
)
(5,476
)
(5,459
)
Non-GAAP adjusted operating expenses, net
of fuel surcharge
455,129
458,253
1,789,928
1,797,969
Non-GAAP adjusted operating income
$
14,601
$
37,165
$
85,102
$
180,453
Non-GAAP adjusted operating margin, net of
fuel surcharge
3.1
%
7.5
%
4.5
%
9.1
%
Non-GAAP adjusted operating ratio, net of
fuel surcharge
96.9
%
92.5
%
95.5
%
90.9
%
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES – WERNER LOGISTICS SEGMENT
(unaudited)
(In thousands)
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Non-GAAP Adjusted Operating
Revenues, Less Purchased
Transportation Expense (1)
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
Operating revenues – (GAAP)
$
213,169
100.0
%
$
226,963
100.0
%
$
831,337
100.0
%
$
910,433
100.0
%
Non-GAAP adjustment:
Purchased transportation expense (10)
(181,735
)
(85.3
)%
(193,132
)
(85.1
)%
(707,493
)
(85.1
)%
(761,948
)
(83.7
)%
Non-GAAP adjusted operating revenues, less
purchased transportation expense
$
31,434
14.7
%
$
33,831
14.9
%
$
123,844
14.9
%
$
148,485
16.3
%
Three Months Ended December
31,
Year Ended December 31,
2024
2023
2024
2023
Non-GAAP Adjusted Operating Income
(Loss) and Non-GAAP Adjusted Operating
Margin (1)
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
$
% of Op. Rev.
Operating income (loss) and operating
margin – (GAAP)
$
1,243
0.6
%
$
4,575
2.0
%
$
(881
)
(0.1
)%
$
15,879
1.7
%
Non-GAAP adjustments:
Amortization of intangible assets (3)
1,148
0.5
%
1,148
0.5
%
4,594
0.5
%
4,866
0.6
%
Contingent consideration adjustment
(5)
—
—
%
(2,700
)
(1.2
)%
—
—
%
(2,700
)
(0.3
)%
Non-GAAP adjusted operating income and
non-GAAP adjusted operating margin
$
2,391
1.1
%
$
3,023
1.3
%
$
3,713
0.4
%
$
18,045
2.0
%
(1) Non-GAAP adjusted operating income;
non-GAAP adjusted operating margin; non-GAAP adjusted operating
margin, net of fuel surcharge; non-GAAP adjusted net income
attributable to Werner; non-GAAP adjusted diluted earnings per
share; non-GAAP adjusted operating revenues, net of fuel surcharge;
non-GAAP adjusted operating revenues, less purchased transportation
expense; non-GAAP adjusted operating expenses; non-GAAP adjusted
operating expenses, net of fuel surcharge; non-GAAP adjusted
operating ratio; and non-GAAP adjusted operating ratio, net of fuel
surcharge should be considered in addition to, rather than as
substitutes for, GAAP operating income; GAAP operating margin; GAAP
net income attributable to Werner; GAAP diluted earnings per share;
GAAP operating revenues; GAAP operating expenses; and GAAP
operating ratio, which are their most directly comparable GAAP
financial measures.
(2) We accrued pre-tax insurance and
claims expense for interest related to a previously disclosed
excess adverse jury verdict rendered on May 17, 2018 in a lawsuit
arising from a December 2014 accident. The Company is appealing
this verdict. Additional information about the accident was
included in our Current Report on Form 8-K dated May 17, 2018.
Under our insurance policies in effect on the date of this
accident, our maximum liability for this accident is $10.0 million
(plus pre-judgment and post-judgment interest) with premium-based
insurance coverage that exceeds the jury verdict amount. We
continue to accrue pre-tax insurance and claims expense for
interest at $0.5 million per month until such time as the outcome
of our appeal is finalized, excluding months where the plaintiffs
requested an extension of time to respond to our petition for
review. Management believes excluding the effect of this item
provides a more useful comparison of our performance from period to
period. This item is included in our Truckload Transportation
Services segment in our Segment Information table.
(3) Amortization expense related to
intangible assets acquired in our business acquisitions is excluded
because management does not believe it is indicative of our core
operating performance. This item is included in our Truckload
Transportation Services and Werner Logistics segments.
(4) During 2024, we sold three parcels of
real estate which resulted in a $7.0 million net pre-tax gain on
sale. Management believes excluding the effect of these unusual and
infrequent items provides a more useful comparison of our
performance from period to period. These items are included in our
Corporate segment.
(5) Contingent consideration, also
referred to as earnout, adjustments related to our business
acquisitions are excluded because management does not believe these
adjustments are indicative of our core operating performance. These
adjustments are recorded in other operating expenses in our Income
Statement and are included in our Werner Logistics segment.
(6) Represents non-operating
mark-to-market adjustments for gains/losses on our minority equity
investments, which we account for under Accounting Standards
Codification (“ASC”) 321, Investments – Equity Securities.
Management believes excluding the effect of gains/losses on our
investments in equity securities provides a more useful comparison
of our performance from period to period. We record changes in the
value of our investments in equity securities in other expense
(income) in our Income Statement.
(7) Represents earnings/losses from our
equity method investment, which we account for under ASC 323,
Investments - Equity Method and Joint Ventures. Management believes
excluding the effect of earnings/losses from our equity method
investment provides a more useful comparison of our performance
from period to period. We record earnings/losses from our equity
method investment in other expense (income) in our Income
Statement.
(8) The income tax effect of the non-GAAP
adjustments is calculated using the incremental income tax rate
excluding discrete items, and the income tax effect for 2024 has
been updated to reflect the annual incremental income tax rate.
(9) Fluctuating fuel prices and fuel
surcharge revenues impact the total company operating ratio and the
TTS segment operating ratio when fuel surcharges are reported on a
gross basis as revenues versus netting the fuel surcharges against
fuel expenses. Management believes netting fuel surcharge revenues,
which are generally a more volatile source of revenue, against fuel
expenses provides a more consistent basis for comparing the results
of operations from period to period.
(10) Management believes excluding
purchased transportation expense from Werner Logistics operating
revenues provides a useful measurement of our ability to source and
sell services provided by third parties.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250206347912/en/
Christopher D. Wikoff Executive Vice President, Treasurer and
Chief Financial Officer (402) 894-3700
Werner Enterprises (NASDAQ:WERN)
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