Quarterly Cash Dividend to Increase 33.3% to
$0.40 Per Share
Old Dominion Freight Line, Inc. (Nasdaq: ODFL) today announced
financial results for the three-month and twelve-month periods
ended December 31, 2022.
Three Months Ended
Twelve Months Ended
December 31,
December 31,
(In thousands,
except per share amounts)
2022
2021
% Chg.
2022
2021
% Chg.
Total revenue
$
1,491,659
$
1,410,358
5.8
%
$
6,260,077
$
5,256,328
19.1
%
LTL services revenue
$
1,473,663
$
1,389,776
6.0
%
$
6,177,055
$
5,177,497
19.3
%
Other services revenue
$
17,996
$
20,582
(12.6
)%
$
83,022
$
78,831
5.3
%
Operating income
$
430,229
$
372,491
15.5
%
$
1,840,632
$
1,391,602
32.3
%
Operating ratio
71.2
%
73.6
%
70.6
%
73.5
%
Net income
$
323,929
$
278,806
16.2
%
$
1,377,159
$
1,034,375
33.1
%
Diluted earnings per share
$
2.92
$
2.41
21.2
%
$
12.18
$
8.89
37.0
%
Diluted weighted average shares
outstanding
111,092
115,681
(4.0
)%
113,078
116,410
(2.9
)%
Greg C. Gantt, President and Chief Executive Officer of Old
Dominion, commented, “Old Dominion produced fourth quarter
financial results that allowed us to finish the year with Company
records for annual revenue and profitability. The results for both
the quarter and the year reflect a continued focus on the
consistent execution of our long-term strategic plan. This plan
revolves around our ability to provide superior service at a fair
price while also ensuring that we have sufficient capacity to
support our anticipated growth. As a result, we have created an
unmatched value proposition in our industry that helped us achieve
over $1 billion of revenue growth for the second straight year in
2022.
“Our revenue growth in the fourth quarter included a 16.7%
increase in LTL revenue per hundredweight, which more than offset
the decrease in LTL tons. LTL revenue per hundredweight, excluding
fuel surcharges, increased 8.7% and reflects the continued
execution of our long-term pricing initiatives. As part of our
pricing philosophy, we focus on continuously improving the
profitability of each customer account through yield increases that
are designed to offset our cost inflation and support further
investments in our capacity and technology. We must continue to
provide our customers with superior service to support this
approach, however, and we were proud to deliver 99% on-time service
during the fourth quarter with a cargo claims ratio of 0.1%.
“The operating ratio for the fourth quarter improved 240 basis
points to 71.2% as compared to the fourth quarter of 2021. We
continued to operate efficiently during the quarter, despite the
decline in volumes, and we also continued our diligent approach to
managing our discretionary spending. Our salaries, wages and
benefit costs as a percent of revenue improved to 44.0% from 46.9%
in the fourth quarter of 2021, and our purchased transportation
costs decreased 200 basis points to 1.9% of revenue. The
combination of these improvements more than offset the increase in
operating supplies and expenses as a percent of revenue that
primarily resulted from the significant increase in the cost of
diesel fuel and other petroleum-based products during the
quarter.”
Cash Flow and Use of Capital
Old Dominion’s net cash provided by operating activities was
$361.3 million for the fourth quarter of 2022 and $1.7 billion for
the year. The Company had $186.3 million in cash and cash
equivalents at December 31, 2022.
Capital expenditures were $270.4 million for the fourth quarter
of 2022 and $775.1 million for the year. The Company expects its
aggregate capital expenditures for 2023 to total approximately $800
million, including planned expenditures of $300 million for real
estate and service center expansion projects; $400 million for
tractors and trailers; and $100 million for information technology
and other assets.
Old Dominion continued to return capital to shareholders during
the fourth quarter of 2022 through its share repurchase and
dividend programs. For the year, the cash utilized for shareholder
return programs included $1.3 billion of share repurchases and
$134.5 million of cash dividends.
Increase to Quarterly Cash Dividend
The Company's Board of Directors has declared a first-quarter
dividend of $0.40 per share, payable on March 15, 2023, to
shareholders of record at the close of business on March 1, 2023.
This dividend represents a 33.3% increase to the quarterly cash
dividend paid in the first quarter of 2022.
Summary
Mr. Gantt concluded, “Old Dominion’s record-breaking results in
2022 reflect the strength of our team and their unwavering
commitment to provide our customers with superior service. While we
have recently announced the transition to our next President and
Chief Executive Officer, I can proudly assure you that our entire
team will remain fully committed to executing the same strategic
plan that has helped us produce profitable growth over the long
term. There will be no change in our commitment to service nor will
we change our approach of investing in our service center network,
our technology and, most importantly, our OD Family of employees.
With our ongoing and steadfast commitment to the core principles
that have differentiated us in the marketplace, we are confident
that we can continue to win market share and increase 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 8, 2023, at (877) 344-7529, Access Code
2673176.
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 health epidemics, pandemics and
similar outbreaks; (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
equipment and parts, including regulatory changes and supply
constraints that could impact the cost of these assets; (6)
increased costs, beyond what we may be able to recover through
price increases, including as a result of inflation; (7) the
availability and cost of suitable real estate; (8) the availability
and cost of third-party transportation used to supplement our
workforce and equipment needs; (9) the availability and price of
diesel fuel and our ability to collect fuel surcharges, as well as
the effectiveness of those fuel surcharges in mitigating the impact
of fluctuating prices for diesel fuel and other petroleum-based
products; (10) seasonal trends in the less-than-truckload (“LTL”)
industry, including harsh weather conditions and disasters; (11)
the availability and cost of capital for our significant ongoing
cash requirements; (12) decreases in demand for, and the value of,
used equipment; (13) our ability to successfully consummate and
integrate acquisitions; (14) the costs and potential liabilities
related to our international business relationships; (15) the costs
and potential adverse impact of compliance with anti-terrorism
measures on our business; (16) the competitive environment with
respect to our industry, including pricing pressures; (17) various
economic factors such as recessions, inflation, 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;
(18) the negative impact of any unionization, or the passage of
legislation or regulations that could facilitate unionization, of
our employees; (19) increases in the cost of employee compensation
and benefit packages used to address general labor market
challenges and to attract or retain qualified employees, including
drivers and maintenance technicians; (20) our ability to retain our
key employees and continue to effectively execute our succession
plan; (21) 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; (22) 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; (23) the 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; (24) disruption in the operational and technical services
(including software as a service) provided to us by third parties,
which could result in operational delays and/or increased costs;
(25) the Compliance, Safety, Accountability initiative of the
Federal Motor Carrier Safety Administration (“FMCSA”), which could
adversely impact our ability to hire qualified drivers, meet our
growth projections and maintain our customer relationships; (26)
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; (27) the
costs and potential liabilities related to compliance with, or
violations of, existing or future governmental laws and
regulations, including environmental laws; (28) the effects of
legal, regulatory or market responses to climate change concerns;
(29) the increase in costs associated with healthcare legislation
and other mandated benefits; (30) the costs and potential
liabilities related to legal proceedings and claims, governmental
inquiries, notices and investigations; (31) the impact of changes
in tax laws, rates, guidance and interpretations; (32) the
concentration of our stock ownership with the Congdon family; (33)
the ability or the failure to declare future cash dividends; (34)
fluctuations in the amount and frequency of our stock repurchases;
(35) volatility in the market value of our common stock; (36) 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 (37)
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 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)
2022
2021
2022
2021
Revenue
$
1,491,659
100.0
%
$
1,410,358
100.0
%
$
6,260,077
100.0
%
$
5,256,328
100.0
%
Operating expenses:
Salaries, wages & benefits
655,852
44.0
%
661,123
46.9
%
2,716,835
43.4
%
2,467,985
47.0
%
Operating supplies & expenses
207,626
13.9
%
159,373
11.3
%
852,955
13.6
%
567,615
10.8
%
General supplies & expenses
39,418
2.6
%
33,152
2.4
%
159,998
2.6
%
136,059
2.6
%
Operating taxes & licenses
35,458
2.4
%
34,902
2.5
%
141,239
2.3
%
133,452
2.5
%
Insurance & claims
7,739
0.5
%
9,970
0.7
%
58,301
0.9
%
53,549
1.0
%
Communications & utilities
10,522
0.7
%
8,825
0.6
%
40,584
0.6
%
34,149
0.7
%
Depreciation & amortization
72,053
4.9
%
66,789
4.7
%
276,050
4.5
%
259,883
4.9
%
Purchased transportation
28,477
1.9
%
55,107
3.9
%
158,111
2.5
%
185,785
3.5
%
Miscellaneous expenses, net
4,285
0.3
%
8,626
0.6
%
15,372
0.2
%
26,249
0.5
%
Total operating expenses
1,061,430
71.2
%
1,037,867
73.6
%
4,419,445
70.6
%
3,864,726
73.5
%
Operating income
430,229
28.8
%
372,491
26.4
%
1,840,632
29.4
%
1,391,602
26.5
%
Non-operating (income) expense:
Interest expense
280
0.0
%
384
0.0
%
1,563
0.0
%
1,727
0.0
%
Interest income
(2,951
)
(0.2
)%
(126
)
(0.0
)%
(4,884
)
(0.1
)%
(786
)
(0.0
)%
Other expense, net
898
0.0
%
457
0.0
%
2,604
0.1
%
2,238
0.1
%
Income before income taxes
432,002
29.0
%
371,776
26.4
%
1,841,349
29.4
%
1,388,423
26.4
%
Provision for income taxes
108,073
7.3
%
92,970
6.6
%
464,190
7.4
%
354,048
6.7
%
Net income
$
323,929
21.7
%
$
278,806
19.8
%
$
1,377,159
22.0
%
$
1,034,375
19.7
%
Earnings per share:
Basic
$
2.94
$
2.43
$
12.26
$
8.94
Diluted
$
2.92
$
2.41
$
12.18
$
8.89
Weighted average outstanding
shares:
Basic
110,350
114,896
112,341
115,651
Diluted
111,092
115,681
113,078
116,410
OLD DOMINION FREIGHT LINE,
INC.
Operating Statistics
Fourth Quarter
Year to Date
2022
2021
% Chg.
2022
2021
% Chg.
Work days
61
61
0.0
%
253
252
0.4
%
Operating ratio
71.2
%
73.6
%
70.6
%
73.5
%
LTL intercity miles (1)
177,068
182,687
(3.1
)%
746,028
707,611
5.4
%
LTL tons (1)
2,330
2,563
(9.1
)%
10,211
10,119
0.9
%
LTL tonnage per day
38,195
42,020
(9.1
)%
40,359
40,153
0.5
%
LTL shipments (1)
2,977
3,256
(8.6
)%
12,989
12,880
0.8
%
LTL shipments per day
48,798
53,374
(8.6
)%
51,341
51,111
0.5
%
LTL revenue per intercity mile
$
8.24
$
7.53
9.4
%
$
8.28
$
7.32
13.1
%
LTL revenue per hundredweight
$
31.30
$
26.82
16.7
%
$
30.24
$
25.59
18.2
%
LTL revenue per hundredweight, excluding
fuel surcharges
$
24.65
$
22.67
8.7
%
$
23.87
$
21.99
8.5
%
LTL revenue per shipment
$
489.96
$
422.28
16.0
%
$
475.45
$
402.01
18.3
%
LTL revenue per shipment, excluding fuel
surcharges
$
385.89
$
356.93
8.1
%
$
375.36
$
345.54
8.6
%
LTL weight per shipment (lbs.)
1,565
1,575
(0.6
)%
1,572
1,571
0.1
%
Average length of haul (miles)
932
944
(1.3
)%
934
935
(0.1
)%
Average active full-time employees
23,799
23,610
0.8
%
24,389
22,098
10.4
%
(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)
2022
2021
Cash and cash equivalents
$
186,312
$
462,564
Short-term investments
49,355
254,433
Other current assets
698,073
666,790
Total current assets
933,740
1,383,787
Net property and equipment
3,687,068
3,215,686
Other assets
217,802
222,071
Total assets
$
4,838,610
$
4,821,544
Current maturities of long-term debt
$
20,000
$
—
Other current liabilities
509,793
464,234
Total current liabilities
529,793
464,234
Long-term debt
79,963
99,947
Other non-current liabilities
575,937
577,556
Total liabilities
1,185,693
1,141,737
Equity
3,652,917
3,679,807
Total liabilities & equity
$
4,838,610
$
4,821,544
Note: The financial and operating
statistics in this press release are unaudited.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230201005274/en/
Adam N. Satterfield Senior Vice President, Finance and Chief
Financial Officer (336) 822-5721
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