To sign up for Analytiqa's free weekly newsletter, please enter your details below.
Analytiqa will not share this information with third parties.
Each segment grew revenue while improving margins in Q3
Knight-Swift Transportation Holdings Inc., one of the largest and most diversified freight transportation companies, operating the largest full truckload fleet in North America, reported Q3, 2021 net income attributable to Knight-Swift of US$206.2 million, up 68.9%. Each reportable segment grew revenue while improving margins, leading to consolidated revenue growth of 32.8%, excluding truckload fuel surcharge, and an improvement of 63.2% in consolidated operating income to US$270.1 million in Q3, 2021, as compared to the same quarter last year. Total revenues climbed 35.7% to US$1,642.4 million.
For the 9M, 2021 period, total revenue increased 22.0% to US$3,856.5 million, as operating income climbed 68.6% to US$623.5 million. Net income increased 82.6% to US$488.8 million.
Truckload segment includes irregular route, dedicated, refrigerated, expedited, flatbed, and cross-border operations across brands with 12,937 irregular route tractors and 4,930 dedicated tractors. Revenue, excluding fuel surcharge and intersegment transactions, in Q3 increased 3.4% to US$933.2 million. Operating income grew 22.4% to US$206.5 million. The Adjusted Operating Ratio improved by 350 basis points to 77.8%, leading to a 22.3% improvement in Adjusted Operating Income. A 24.9% increase in revenue per loaded mile, excluding fuel surcharge and intersegment transactions, partially offset by a 13.6% decrease in miles per tractor, contributed to a 6.8% increase in average revenue per tractor. Shipping demand remains strong throughout all markets. The Company experienced more opportunities in shorter length of haul lanes, which have resulted in higher revenue per mile but fewer miles per tractor. These opportunities ultimately contributed to higher revenue per tractor and improved margins.
Logistics revenue, excluding intersegment transactions, in Q3 increased 130.0% to US$221.4 million. Operating income grew 994.8% to US$27.1 million. Demand for the logistics service offering continued to grow throughout the quarter, as the Company continue to leverage its fleet of over 60,000 trailers in a Power-only service offering. Logistics revenue increased 130.0% as it grew load count by 60.7%, while increasing revenue per load by 43.1%. The Adjusted Operating Ratio improved to 87.6%, resulting in a 1,008.2% increase in Adjusted Operating Income. Brokerage gross margin was 18.1% in Q3, 2021, compared to 11.0% in Q3, 2020. Within the Power-only service offering, revenue grew by 333.9% as a result of an 84.1% increase in load volumes. The Power-only service offering represented approximately 35.0% of brokerage load volumes during Q3, 2021. Through the Select platform, the Company digitally matched more than 4,500 carriers with available capacity to available loads during Q3, 2021.
Intermodal revenue grew by 14.1% to US$112.7 million, as operating income increased 3,717.6% to US$9.5 million. The Adjusted Operating Ratio improved from 99.7% to 91.5%, resulting in a US$9.3 million increase in operating income. Continued rail congestion and rail allocations resulted in a reduction in load count, but contributed to a 25.9% increase in revenue per load. Intermodal is exhibiting strong momentum, and the Company expect operational improvements in cost structure and network design as it transitions to a new western rail partner in the coming quarters. To position Intermodal for continued growth, the Company plan to add approximately 1,000 containers over the next two quarters.
The LTL segment, which operates across approximately 70 facilities with a door count of over 3,400, generated US$167.9 million in revenue, excluding fuel surcharge and an 87.5% Adjusted Operating Ratio during Q3, 2021. During the quarter, the LTL segment earned revenue per hundredweight of US$12.44, a 6.9% increase over Q3, 2020, while revenue per shipment, excluding fuel surcharge increased 7.9% to US$138.27.