Quarterly Cash Dividend to Increase 50.0% to
$0.30 Per Share
Old Dominion Freight Line, Inc. (Nasdaq: ODFL) today announced
financial results for the three-month and twelve-month periods
ended December 31, 2021.
Three Months Ended
Twelve Months Ended
December 31,
December 31,
(In thousands, except per share
amounts)
2021
2020
% Chg.
2021
2020
% Chg.
Total revenue
$
1,410,358
$
1,073,389
31.4
%
$
5,256,328
$
4,015,129
30.9
%
LTL services revenue
$
1,389,776
$
1,057,914
31.4
%
$
5,177,497
$
3,961,054
30.7
%
Other services revenue
$
20,582
$
15,475
33.0
%
$
78,831
$
54,075
45.8
%
Operating income
$
372,491
$
254,302
46.5
%
$
1,391,602
$
906,882
53.4
%
Operating ratio
73.6
%
76.3
%
73.5
%
77.4
%
Net income
$
278,806
$
189,832
46.9
%
$
1,034,375
$
672,682
53.8
%
Diluted earnings per share
$
2.41
$
1.61
49.7
%
$
8.89
$
5.68
56.5
%
Diluted weighted average shares
outstanding
115,681
117,887
(1.9
)%
116,410
118,493
(1.8
)%
Greg C. Gantt, President and Chief Executive Officer of Old
Dominion, commented, “The strength of Old Dominion’s fourth quarter
financial performance resulted in new Company records for annual
revenue and profitability. Our financial results for the quarter –
and the year – continue to reflect the consistent execution of our
long-term strategic plan. As part of this plan, we focus on
providing superior service at a fair price while also consistently
investing in our capacity to support anticipated growth in future
periods. Our ability to consistently deliver this high-quality
service and capacity, coupled with a positive domestic economy, has
driven strong customer demand for our service offerings. We do not
expect any near-term changes in our customer demand trends and
believe our service and capacity advantages will continue to
support our ability to win additional market share throughout
2022.
“Our revenue growth for the fourth quarter was primarily due to
a 16.1% increase in LTL revenue per hundredweight and a 14.3%
increase in LTL tons per day. The increase in our LTL tons included
a 17.5% increase in LTL shipments per day that was partially offset
by a 2.7% decrease in LTL weight per shipment. Our LTL revenue per
hundredweight, excluding fuel surcharges, increased 9.2% and
benefited from the decrease in our weight per shipment as well as
the 1.8% increase in our average length of haul, as the changes to
each of these metrics generally had the effect of increasing our
reported yields. The increase in LTL revenue per hundredweight also
reflects the success of our long-term pricing strategy, which is to
consistently improve the profitability of each customer account by
increasing our yields to both offset cost inflation and support
further investments in capacity and technology.
“Our operating ratio improved 270 basis points to 73.6% for the
fourth quarter of 2021. This improvement was driven by our quality
revenue growth and the efficiency of our operations. As a result,
we improved both our direct operating costs and total overhead
costs as a percent of revenue during the fourth quarter. Our
salaries, wages and benefit costs as a percent of revenue improved
to 46.9% from 50.7% in the fourth quarter of 2020, which more than
offset the increases in expense for both operating supplies and
purchased transportation. Our average number of full-time employees
increased 20.3% during the fourth quarter, and we intend to hire
additional employees in 2022 to support our anticipated growth. In
addition, we expect to continue to utilize purchased transportation
to support the capacity of both our people and our fleet during
2022.”
Cash Flow and Use of Capital
Old Dominion’s net cash provided by operating activities was
$340.0 million for the fourth quarter of 2021 and $1.2 billion for
the year. The Company had $462.6 million in cash and cash
equivalents at December 31, 2021.
Capital expenditures were $165.4 million for the fourth quarter
of 2021 and $550.1 million for the year. The Company expects its
aggregate capital expenditures for 2022 to total approximately $825
million, including planned expenditures of $300 million for real
estate and service center expansion projects; $485 million for
tractors and trailers; and $40 million for information technology
and other assets.
Old Dominion paid $23.0 million in cash dividends in the fourth
quarter of 2021. The Company did not utilize cash for share
repurchases during the fourth quarter of 2021, although the $250.0
million accelerated share repurchase program that we entered into
on August 26, 2021 remained active. The Company utilized $691.4
million of cash for its shareholder return programs during 2021,
which consisted of $599.0 million of share repurchases and $92.4
million of cash dividends.
Increase to Quarterly Cash Dividend
The Company’s Board of Directors has declared a first-quarter
dividend of $0.30 per share, payable on March 16, 2022, to
shareholders of record at the close of business on March 2, 2022.
This dividend represents a 50.0% increase to the quarterly cash
dividend paid in the first quarter of 2021.
Summary
Mr. Gantt concluded, “Old Dominion’s operating and financial
performance during 2021 included new Company records that were
driven by the consistent and disciplined execution of our long-term
strategic plan. We created value for our customers by delivering
best-in-class service and offering capacity at a time when it was
generally limited in our industry. As a result, we believe we
strengthened our value proposition and increased our ability to win
further market share in the future. To sustain the existing
momentum in our business, we intend to continue investing in
service center capacity, our fleet, our technologies and, most
importantly, our OD Family of employees. Our team is encouraged by
the opportunities ahead, and we are confident that the continued
execution of our strategic plan will produce further profitable
growth and increased shareholder value.”
Old Dominion will hold a conference call to discuss this release
today at 10:00 a.m. Eastern Time. Investors will have the
opportunity to listen to the conference call live over the internet
by going to ir.odfl.com. Please log on at least 15 minutes early to
register, download and install any necessary audio software. For
those who cannot listen to the live broadcast, a replay will be
available at this website shortly after the call and will be
available for 30 days. A telephonic replay will also be available
through February 9, 2022, at (877) 344-7529, Access Code
4631573.
Forward-looking statements in this news release are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. We caution the reader that such
forward-looking statements involve risks and uncertainties that
could cause actual events and results to be materially different
from those expressed or implied herein, including, but not limited
to, the following: (1) the challenges associated with executing our
growth strategy, and developing, marketing and consistently
delivering high-quality services that meet customer expectations;
(2) various risks related to public health epidemics, pandemics and
similar outbreaks, including the continuing impact of the COVID-19
pandemic; (3) changes in our relationships with significant
customers; (4) our exposure to claims related to cargo loss and
damage, property damage, personal injury, workers’ compensation and
healthcare, increased self-insured retention or deductible levels
or premiums for excess coverage, and claims in excess of insured
coverage levels; (5) the availability and cost of new equipment,
including regulatory changes and supply constraints that could
impact the cost of these assets; (6) the availability and cost of
third-party transportation used to supplement our workforce and
equipment needs; (7) the availability and price of diesel fuel and
our ability to collect fuel surcharges and the effectiveness of
those fuel surcharges in mitigating the impact of fluctuating
prices for diesel fuel and other petroleum-based products; (8)
seasonal trends in the less-than-truckload (“LTL”) industry,
including harsh weather conditions and disasters; (9) the
availability and cost of capital for our significant ongoing cash
requirements; (10) decreases in demand for, and the value of, used
equipment; (11) our ability to successfully consummate and
integrate acquisitions; (12) the costs and potential liabilities
related to our international business relationships; (13) the costs
and potential adverse impact of compliance with anti-terrorism
measures on our business; (14) the competitive environment with
respect to our industry, including pricing pressures; (15) various
economic factors such as recessions, downturns in the economy,
global uncertainty and instability, changes in international trade
policies, changes in U.S. social, political, and regulatory
conditions or a disruption of financial markets, which may decrease
demand for our services or increase our costs; (16) the negative
impact of any unionization, or the passage of legislation or
regulations that could facilitate unionization, of our employees;
(17) increases in the cost of employee compensation and benefit
packages used to attract and retain qualified employees, including
drivers and maintenance technicians, in order to meet freight
demand and maintain our customer relationships; (18) our ability to
retain our key employees and continue to effectively execute our
succession plan; (19) potential costs and liabilities associated
with cyber incidents and other risks with respect to our
information technology systems or those of our third-party service
providers, including system failure, security breach, disruption by
malware or ransomware or other damage; (20) the failure to adapt to
new technologies implemented by our competitors in the LTL and
transportation industry, which could negatively affect our ability
to compete; (21) failure to keep pace with developments in
technology, any disruption to our technology infrastructure, or
failures of essential services upon which our technology platforms
rely, which could cause us to incur costs or result in a loss of
business; (22) the Compliance, Safety, Accountability initiative of
the Federal Motor Carrier Safety Administration (“FMCSA”) could
adversely impact our ability to hire qualified drivers, meet our
growth projections and maintain our customer relationships; (23)
the costs and potential adverse impact of compliance with, or
violations of, current and future rules issued by the Department of
Transportation, the FMCSA and other regulatory agencies; (24) the
costs and potential liabilities related to compliance with, or
violations of, existing or future governmental laws and
regulations, including environmental laws; (25) the effects of
legal, regulatory or market responses to climate change concerns;
(26) the increase in costs associated with healthcare legislation
and other mandated benefits; (27) the costs and potential
liabilities related to litigation and governmental proceedings,
inquiries, notices or investigations; (28) the impact of changes in
tax laws, rates, guidance and interpretations; (29) the
concentration of our stock ownership with the Congdon family; (30)
the ability or the failure to declare future cash dividends; (31)
fluctuations in the amount and frequency of our stock repurchases;
(32) volatility in the market value of our common stock; (33) the
impact of certain provisions in our articles of incorporation,
bylaws, and Virginia law that could discourage, delay or prevent a
change in control of us or a change in our management; and (34)
other risks and uncertainties described in our most recent Annual
Report on Form 10-K and other filings with the SEC. Our
forward-looking statements are based upon our beliefs and
assumptions using information available at the time the statements
are made. We caution the reader not to place undue reliance on our
forward-looking statements as (i) these statements are neither a
prediction nor a guarantee of future events or circumstances and
(ii) the assumptions, beliefs, expectations and projections about
future events may differ materially from actual results. We
undertake no obligation to publicly update any forward-looking
statement to reflect developments occurring after the statement is
made, except as otherwise required by law.
Old Dominion Freight Line, Inc. is one of the largest North
American less-than-truckload (“LTL”) motor carriers and provides
regional, inter-regional and national LTL services through a single
integrated, union-free organization. Our service offerings, which
include expedited transportation, are provided through an expansive
network of service centers located throughout the continental
United States. The Company also maintains strategic alliances with
other carriers to provide LTL services throughout North America. In
addition to its core LTL services, the Company offers a range of
value-added services including container drayage, truckload
brokerage and supply chain consulting.
OLD DOMINION FREIGHT LINE,
INC.
Statements of
Operations
Fourth Quarter
Year to Date
(In thousands, except per share
amounts)
2021
2020
2021
2020
Revenue
$
1,410,358
100.0
%
$
1,073,389
100.0
%
$
5,256,328
100.0
%
$
4,015,129
100.0
%
Operating expenses:
Salaries, wages & benefits
661,123
46.9
%
543,847
50.7
%
2,467,985
47.0
%
2,053,894
51.2
%
Operating supplies & expenses
159,373
11.3
%
100,057
9.3
%
567,615
10.8
%
373,431
9.3
%
General supplies & expenses
33,152
2.4
%
23,407
2.2
%
136,059
2.6
%
110,279
2.7
%
Operating taxes & licenses
34,902
2.5
%
30,663
2.8
%
133,452
2.5
%
116,943
2.9
%
Insurance & claims
9,970
0.7
%
9,783
0.9
%
53,549
1.0
%
42,364
1.1
%
Communications & utilities
8,825
0.6
%
8,467
0.8
%
34,149
0.7
%
31,542
0.8
%
Depreciation & amortization
66,789
4.7
%
65,106
6.1
%
259,883
4.9
%
261,259
6.5
%
Purchased transportation
55,107
3.9
%
32,759
3.0
%
185,785
3.5
%
97,947
2.4
%
Miscellaneous expenses, net
8,626
0.6
%
4,998
0.5
%
26,249
0.5
%
20,588
0.5
%
Total operating expenses
1,037,867
73.6
%
819,087
76.3
%
3,864,726
73.5
%
3,108,247
77.4
%
Operating income
372,491
26.4
%
254,302
23.7
%
1,391,602
26.5
%
906,882
22.6
%
Non-operating expense (income):
Interest expense
384
0.0
%
846
0.1
%
1,727
0.0
%
2,782
0.1
%
Interest income
(126
)
(0.0
)%
(228
)
(0.0
)%
(786
)
(0.0
)%
(1,830
)
(0.0
)%
Other expense, net
457
0.0
%
361
0.0
%
2,238
0.1
%
4,566
0.1
%
Income before income taxes
371,776
26.4
%
253,323
23.6
%
1,388,423
26.4
%
901,364
22.4
%
Provision for income taxes
92,970
6.6
%
63,491
5.9
%
354,048
6.7
%
228,682
5.6
%
Net income
$
278,806
19.8
%
$
189,832
17.7
%
$
1,034,375
19.7
%
$
672,682
16.8
%
Earnings per share:
Basic
$
2.43
$
1.62
$
8.94
$
5.71
Diluted
2.41
1.61
8.89
5.68
Weighted average outstanding
shares:
Basic
114,896
117,113
115,651
117,737
Diluted
115,681
117,887
116,410
118,493
OLD DOMINION FREIGHT LINE,
INC.
Operating Statistics
Fourth Quarter
Year to Date
2021
2020
% Chg.
2021
2020
% Chg.
Work days
61
62
(1.6
)%
252
254
(0.8
)%
Operating ratio
73.6
%
76.3
%
73.5
%
77.4
%
LTL intercity miles (1)
182,687
159,896
14.3
%
707,611
617,805
14.5
%
LTL tons (1)
2,563
2,279
12.5
%
10,119
8,770
15.4
%
LTL tonnage per day
42,020
36,758
14.3
%
40,153
34,528
16.3
%
LTL shipments (1)
3,256
2,816
15.6
%
12,880
10,869
18.5
%
LTL shipments per day
53,374
45,419
17.5
%
51,111
42,791
19.4
%
LTL revenue per intercity mile
$
7.53
$
6.59
14.3
%
$
7.32
$
6.42
14.0
%
LTL revenue per hundredweight
$
26.82
$
23.10
16.1
%
$
25.59
$
22.62
13.1
%
LTL revenue per hundredweight, excluding
fuel surcharges
$
22.67
$
20.76
9.2
%
$
21.99
$
20.21
8.8
%
LTL revenue per shipment
$
422.28
$
374.08
12.9
%
$
402.01
$
364.94
10.2
%
LTL revenue per shipment, excluding fuel
surcharges
$
356.93
$
336.04
6.2
%
$
345.54
$
326.09
6.0
%
LTL weight per shipment (lbs.)
1,575
1,619
(2.7
)%
1,571
1,614
(2.7
)%
Average length of haul (miles)
944
927
1.8
%
935
925
1.1
%
Average active full-time employees
23,610
19,630
20.3
%
22,098
19,064
15.9
%
(1) -
In thousands
Note:
Our LTL operating statistics exclude
certain transportation and logistics services where pricing is
generally not determined by weight. These statistics also exclude
adjustments to revenue for undelivered freight required for
financial statement purposes in accordance with our revenue
recognition policy.
OLD DOMINION FREIGHT LINE,
INC.
Balance Sheets
December 31,
December 31,
(In thousands)
2021
2020
Cash and cash equivalents
$
462,564
$
401,430
Short-term investments
254,433
330,274
Other current assets
666,790
511,635
Total current assets
1,383,787
1,243,339
Net property and equipment
3,215,686
2,914,031
Other assets
222,071
212,040
Total assets
$
4,821,544
$
4,369,410
Current liabilities
$
464,234
$
373,130
Long-term debt
99,947
99,931
Other non-current liabilities
577,556
570,061
Total liabilities
1,141,737
1,043,122
Equity
3,679,807
3,326,288
Total liabilities & equity
$
4,821,544
$
4,369,410
Note: The financial and operating statistics in this press
release are unaudited.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220202005341/en/
Adam N. Satterfield Senior Vice President, Finance and Chief
Financial Officer (336) 822-5721
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