Oil spikes to $120 on Iran news before settling near $106. Plus: another influencer shipment gets stolen, Wyoming can now pull your truck, 24 states sue over tariffs, and more.
The Supreme Court just heard arguments in the broker liability case we’ve been tracking. Plus: oil shipping costs explode, trucking insurance is stuck in 1980, regulators brace for a carrier crackdown, and more.
Good Friday morning. Today's newsletter highlights our feature story on Q4 2023 logistics earnings reports, capturing the financial performances of key players across the industry. Also, catch insights on the new freight scam targeting brokers, Gord Magill's feature on Tucker Carlson's show, and the finalized Forward Air-Omni merger details.
🤔 Question of the Day: Both Delta Airlines and American Airlines Cargo divisions reported __% declines in year-over-year revenue for Q4 of 2023. Scroll to the main story to find out.
Three Freight Headlines: Fake shippers scamming brokers, Gord Magill on Tucker Carlson, and the Forward Air-Omni merger finalization.
Q4 2023 Logistics Earnings Reports
Around the Freight Web: Kenco facility shutdown leads to layoffs, Kodiak and Ryder launch driverless trucks in Texas, and driver frustrations over smart truck tech addressed.
Freight Meme of the Day
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🐔 WHAT’S COOKIN’ IN FREIGHT
🤥 New Year. New Scam. A new scam is tricking brokers. Scammers pretend to be both shippers and carriers. They pretend to be shippers with brokers and then book transportation as fake carriers. Brokers end up paying for these services after receiving fraudulent paperwork - but of course, they never get paid. To avoid this, experts like Cassandra Gaines suggest checking the backgrounds of shippers carefully and verifying carriers through services like SAFER or Carrier Assure (Cassandra's company). This scam can cause a lot of financial loss if not detected early. Word of advice: never accept a shipment from a shipper that called in. Real shippers don't do that.
👀 Trucker Sits Down with Tucker Carlson. The Freight X community was stunned on Wednesday when fellow Please Adviser and trucker Gord Magill joined Tucker Carlson on his show to discuss the Canadian "Freedom Convoy" protests. Gord, who was banned from X/Twitter for making threats against the Canadian Prime Minister two years ago during the protests, also hosts his own trucker podcast called "Voice of GO(r)D." His appearance on Tucker Carlson not only sparked a lot of interest from the Freight X community but also from others who believe he, alongside Reed Loustalot, are deep state plants.
🤝 Forward Air & Omni Hug It Out. Forward Air completes the acquisition of Omni Logistics for $2.1B after initial estimates of $3.2B. This deal closure comes after a drawn-out legal dispute, resulting in revised terms that reduced the cash component from $150M to $20M and equity from 37.7% to 35%. The merger, expected to impact the expedited LTL market significantly, faced shareholder challenges over debt concerns and control shifts. Despite a steep drop in Forward Air's stock prices since the deal's announcement, the company is poised to deliver enhanced freight services with Omni's integration.
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Q4 2023 Logistics Earnings Reports
Last Friday, we covered J.B. Hunt's Q4 earnings report in depth. This week, we are taking a look at other Q4 reports from publicly traded logistics companies: Covenant, Knight-Swift, CSX, and two airline cargo divisions.
Covenant Logistics Group
Q4 2023 Net Income: $12.79 million (up from $11.50 million in Q4 2022).
Total Revenue: A 7.4% decline YoY to $273.9 million.
Earnings Per Share (EPS): $0.93 (adjusted EPS at $1.07) a 22% decrease YoY, but second-best in the company's history.
Operating Ratio: Improved to 94.8%
Strategic acquisitions contributed to diversification and revenue.
Covenant anticipates a gradual freight market recovery. Their strategic focus on acquisitions and fleet optimization is aimed at navigating the challenging market effectively.
Knight-Swift Transportation
Q4 2023 Revenue (excluding fuel surcharge): Increased by 11.6% from the previous quarter.
Adjusted Operating Income: Decreased 78.6%
Net Loss: $10.66 million (compared to net income of $148.7 million a year ago).
The LTL segment exhibited nearly 40% year-over-year revenue growth.
Knight-Swift's performance was heavily impacted by its third-party insurance business, leading to a $72 million operating loss in Q4. The company plans to exit this segment to focus on more profitable areas in Q1 2024.
CSX
The rail cargo sector has seen a critical year with the impact of border closures as trade expands with Mexico, strike impacts, and the Panama Canal disruption.
Q4 2023 Operating Income: $1.32 billion (down from $1.46 billion in Q4 2022)
Net Earnings: $886 million, or $0.45 per diluted share (compared to $1.02 billion, or $0.49 per share, in Q4 2022)
Total Volume: 1.56 million units, a 1% increase YoY
Full Year 2023 Operating Income: $5.56 billion (down 8% from 2022)
Net Earnings: $3.72 billion, or $1.85 per share (compared to $4.17 billion, or $1.95 per share, in 2022)
Total Revenue: $14.66 billion in 2023, a 1% decrease year-over-year
Air
Both Delta Airlines and American Airlines Cargo divisions reported 24% declines in year-over-year revenue numbers for Q4 of 2023. However, with the current situation in the Red Sea, we should see those numbers rebound slightly in Q1 of this year.
Q4 Cargo Revenue: $199 million, a 24.2% decline YoY.
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AROUND THE FREIGHT WEB
🚨 Kenco Shutdown in Indiana: Kenco Logistic Services in Indianapolis announces its shutdown, leading to 110 layoffs on March 19, 2024.
🚚 Kodiak-Ryder Partnership. Kodiak Robotics is set to launch driverless operations in Texas this year, in collaboration with Ryder System, after opening an AV truckport in Houston.
🚛 Smart Trucks Don’t Learn. Rachel Premack addresses driver frustrations as driver assistance technology, incapable of learning from its mistakes, enters more cabs.
❄️ CJ Logistics Cold Storage. CJ Logistics America is opening a state-of-the-art cold storage warehouse in Gainesville, Georgia, enhancing the poultry capital's logistics capabilities.
🔧 Fifth Wheel Freight Expansion. Fifth Wheel Freight plans a significant expansion in Michigan, investing $40 million and creating 352 jobs.
FREIGHT CONFERENCES WE'RE ATTENDING
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FREIGHT MEME OF THE DAY
Also, check out:
🎧 The FreightCaviar Podcast. Listen to this week's podcast on Spotify & Apple Podcasts.
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🎧 The Bootstrapper's Guide to Logistics is a podcast that highlights and inspires supply chain entrepreneurs, sharing their stories and building a community from the ground up.
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I’m Adriana, a writer and editor at FreightCaviar. I’ve covered everything from freight tech to industry lawsuits and market shifts, helping scale us to almost 14K subscribers. My goal: to make logistics stories digestible, clear, and fun to read.
Oil spikes to $120 on Iran news before settling near $106. Plus: another influencer shipment gets stolen, Wyoming can now pull your truck, 24 states sue over tariffs, and more.
The Supreme Court just heard arguments in the broker liability case we’ve been tracking. Plus: oil shipping costs explode, trucking insurance is stuck in 1980, regulators brace for a carrier crackdown, and more.
Tucker Carlson’s nicotine brand loses 378,000 tins in a cargo theft. Plus: produce rates reset, diesel climbs, and a bill that could pull hundreds of thousands of drivers off the road.
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