Yahoo Finance Werner (WERN) Q1 Earnings Miss Estimates, Revenues Beat
Werner Enterprises, Inc. WERN reported mixed first-quarter 2023 results, wherein earnings missed the Zacks Consensus Estimate but revenues surpassed.
Quarterly earnings (excluding 5 cents from non-recurring items) of 60 cents per share lagged the Zacks Consensus Estimate of 71 cents. The bottom line fell 37.5% on a year-over-year basis.
Total revenues of $832.7 million outperformed the Zacks Consensus Estimate of $830.2 million. The top line increased 8.9% on a year-over-year basis primarily on higher revenues in the Truckload Transportation Services (TTS) and Logistics segments.
Operating income (adjusted) of $57.5 million fell 33% year over year. The adjusted operating margin contracted 440 basis points (bps) to 6.9%. Operating expenses rose 14.4% to $779.3 million in the reported quarter.
Werner Enterprises, Inc. Price, Consensus and EPS Surprise
Werner Enterprises, Inc. price-consensus-eps-surprise-chart | Werner Enterprises, Inc. Quote
Segmental Results
Revenues in the TTS segment increased 5% on a year-over-year basis to $588.33 million on the back of solid freight demand. Adjusted operating income decreased 31% to $53.7 million. The adjusted operating margin fell 490 bps to 9.1%. The adjusted operating ratio (operating expenses as a percentage of revenues) improved 490 bps to 90.9%.
Logistics’ revenues totaled $228.7 million, up 21% year over year. The segment reported an adjusted operating income of $6.36 million, down 31% year over year. The adjusted operating margin fell 210 bps to 2.8%.
Liquidity
As of Mar 31, Werner had cash and cash equivalents of $130 million compared with $107.2 million at the end of December 2022. Long-term debt (net of current portion) totaled $686.25 million at the end of the reported quarter compared with $687.5 million at December 2022 end.
The company generated $166.8 million of cash from operations in first-quarter 2023. Capital expenditure amounted to $102.7 million.
In the reported quarter, Werner did not repurchase any share. As of Mar 31, WERN had 2.3 million shares available under its share repurchase authorization.
Outlook
Werner anticipates TTS truck growth between negative 2% and 1% (prior view: 1-4%) for 2023.
Net capital expenditure is estimated to be $350-$400 million. Under the TTS guidance, WERN estimates dedicated revenues per truck per week to remain flat to increase 3% in 2023. The effective income tax rate is anticipated to be 24-25%.
One-way Truckload revenues per total mile are predicted to decline 3-6%. Werner expects the average truck age to be 2.2 years for 2023, while the 2023 trailer age is forecast to be five years.
Currently, Werner carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Q1 Performance of Other Transportation Companies
J.B. Hunt Transport Services, Inc.’s JBHT first-quarter 2023 earnings of $1.89 per share missed the Zacks Consensus Estimate of $2.04 and declined 17.5% year over year.
JBHT’s total operating revenues of $3,229.58 million lagged the Zacks Consensus Estimate of $3,434.4 million and fell 7.4% year over year. The downfall was due to declines in the volume of 25% in Integrated Capacity Solutions (ICS), 5% in Intermodal (JBI) and 17% in Final Mile Services (FMS). A decline of 17% in revenue per load in Truckload (JBT) added to the woes. Revenue declines in ICS, JBI, FMS and JBT were partially offset by Dedicated Contract Services revenue growth of 13%. JBHT’s total operating revenues, excluding fuel surcharges, decreased 10.2% year over year.
Delta Air Lines’ DAL first-quarter 2023 earnings (excluding 82 cents from non-recurring items) of 25 cents per share missed the Zacks Consensus Estimate of 29 cents. Volatile fuel price and unfavorable weather conditions led to this downtick. DAL reported a loss of $1.23 per share a year ago as air-travel demand was not so buoyant back then.
DAL reported revenues of $12,759 million, which missed the Zacks Consensus Estimate of $12,767.4 million. However, driven by higher air-travel demand, total revenues increased 36.49% on a year-over-year basis.
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