0000793074false00007930742024-02-062024-02-06

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 6, 2024
WERNER ENTERPRISES, INC.
(Exact name of registrant as specified in its charter)

Nebraska0-1469047-0648386
(State or other jurisdiction of
incorporation)		(Commission File Number)(I.R.S. Employer
Identification No.)
14507 Frontier Road 
Post Office Box 45308
Omaha,Nebraska68145-0308
(Address of principal executive offices) (Zip Code)
(402) 895-6640
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR40.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
 Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.01 Par ValueWERNThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


ITEM 2.02.    RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On February 6, 2024, the registrant issued a press release regarding, among other things, its financial results for the fourth quarter and year ended December 31, 2023. A copy of the press release is furnished as Exhibit 99.1 to this Form 8-K.

In accordance with General Instruction B.2 to the Form 8-K, the information under this Item 2.02 and the press release furnished as Exhibit 99.1 to this Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section 18, nor shall such information and exhibit deemed incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended (the “Securities Act”), unless the registrant expressly states that such information and exhibit are to be considered “filed” under the Exchange Act or incorporates such information and exhibit by specific reference in an Exchange Act or Securities Act filing.

The press release furnished as Exhibit 99.1 to this Form 8-K may contain forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements are based on information presently available to the registrant’s management and are current only as of the date made. Actual results could also differ materially from those anticipated as a result of a number of factors, including, but not limited to, those discussed in the registrant’s Annual Report on Form 10-K for the year ended December 31, 2022 and subsequently filed Quarterly Reports on Form 10-Q. For those reasons, undue reliance should not be placed on any forward-looking statement. The registrant assumes no duty or obligation to update or revise any forward-looking statement, although it may do so from time to time as management believes is warranted or as may be required by applicable securities law. Any such updates or revisions may be made by filing reports with the U.S. Securities and Exchange Commission, through the issuance of press releases or by other methods of public disclosure.

ITEM 9.01.     FINANCIAL STATEMENTS AND EXHIBITS.

    (d)    Exhibits.










SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


WERNER ENTERPRISES, INC.
Date: February 6, 2024
By: /s/ Christopher D. Wikoff
 Christopher D. Wikoff
 Executive Vice President, Treasurer and
Chief Financial Officer
Date: February 6, 2024
By: /s/ James L. Johnson
 James L. Johnson
 Executive Vice President and
Chief Accounting Officer




Exhibit 99.1

image.jpg

Werner Enterprises Reports Fourth Quarter and Annual 2023 Results

Fourth Quarter 2023 Highlights (all metrics compared to fourth quarter 2022)

•Total revenues of $821.9 million, down 5%
•Operating income of $37.9 million, down 57%; non-GAAP adjusted operating income of $39.2 million, down 56%
•Operating margin of 4.6%, down 570 basis points; non-GAAP adjusted operating margin of 4.8%, down 560 basis points
•Diluted EPS of $0.37, down 61%; non-GAAP adjusted diluted EPS of $0.39, down 61%

2023 Highlights (all metrics compared to 2022)

•Total revenues of $3.28 billion, relatively flat
•Operating income of $176.4 million, down 45%; non-GAAP adjusted operating income of $189.7 million, down 43%
•Operating margin of 5.4%, down 440 basis points; non-GAAP adjusted operating margin of 5.8%, down 430 basis points
•Diluted EPS of $1.76, down 53%; non-GAAP adjusted diluted EPS of $1.93, down 48%

OMAHA, Neb., February 6, 2024 -- Werner Enterprises, Inc. (Nasdaq: WERN), a premier transportation and logistics provider, today reported results for the fourth quarter and year ended December 31, 2023.

“Freight conditions remained challenging in the fourth quarter with ongoing pricing pressure. Despite this, our nearly 14,000 talented Werner team members and cycle-tested management team focused on what we can control. Our Dedicated business proved to be durable and resilient, generating double-digit margins and growing revenue per truck for the 9th year out of the last decade. Our One-Way Trucking business’ miles per truck improved nearly 9% year over year during the quarter, while rate per mile decline was more favorable than industry benchmarks. Logistics volume was strong, and revenue grew over 6% year over year, extending to 13 straight quarters of growth,” said Derek J. Leathers, Chairman and CEO. “We continue to execute on structural cost changes, realizing over $40 million of savings in 2023, helping to partially offset market dynamics and conditions out of our control, such as rate pressure, cost inflation and declining resale values of equipment. During the quarter, operating cash flow remained strong, which we used to reinvest in the business, pay down over $40 million in debt and return value to our shareholders. Improved production, our elevated rigor on operational excellence, cost savings, innovation, and capital deployment positions us well to benefit as the market comes more into balance.”

Total revenues for the quarter were $821.9 million, a decrease of $39.5 million compared to the prior year quarter, due to a $54.7 million decrease in Truckload Transportation Services (“TTS”) revenues, partially offset by Logistics revenues growth of $13.5 million, or 6%, including the ReedTMS acquisition. A significant portion of the TTS revenue decline was due to $24.9 million lower fuel surcharge revenues. Net of trucking fuel surcharge revenues, consolidated total revenues decreased $14.6 million, or 2%, during the quarter.



Werner Enterprises, Inc. - Release of February 6, 2024
Page 2
Operating income of $37.9 million decreased $50.4 million, or 57%, while operating margin of 4.6% decreased 570 basis points. On a non-GAAP basis, adjusted operating income of $39.2 million decreased $50.7 million, or 56%. Adjusted operating margin of 4.8% declined 560 basis points from 10.4% for the same quarter last year.

TTS operating income decreased $46.0 million, and TTS adjusted operating income decreased $45.9 million. Logistics operating income decreased $5.3 million and adjusted operating income decreased $5.0 million. Corporate and Other (including driving schools) operating income increased $0.8 million.

Net interest expense of $7.3 million increased $2.2 million primarily due to higher interest rates for variable rate debt and an increase in average debt outstanding. The effective income tax rate during the the quarter was 23.1%, compared to 24.7% in fourth quarter 2022.

During fourth quarter 2023, we had losses on our strategic investments of $0.3 million, compared to losses of $2.2 million, or $0.03 per share, in fourth quarter 2022. Consistent with prior reporting, increases or decreases to the values of these strategic investments are adjusted out for determining non-GAAP adjusted net income and non-GAAP adjusted earnings per share.

Net income attributable to Werner of $23.6 million decreased 61%. On a non-GAAP basis, adjusted net income attributable to Werner of $24.6 million decreased 61%. Diluted EPS of $0.37 decreased 61%. On a non-GAAP basis, adjusted diluted EPS of $0.39 decreased 61%.

Key Consolidated Financial Metrics
Three Months Ended
December 31,		Year Ended
December 31,
(In thousands, except per share amounts)20232022Y/Y
Change		20232022Y/Y
Change
Total revenues$821,945 $861,491 (5)%$3,283,499 $3,289,978 0 %
Truckload Transportation Services revenues580,093 634,787 (9)%2,310,810 2,428,686 (5)%
Werner Logistics revenues226,963 213,485 6 %910,433 793,492 15 %

Operating income		37,932 88,381 (57)%176,416 323,076 (45)%
Operating margin4.6 %10.3 %(570) bps5.4 %9.8 %(440) bps
Net income attributable to Werner23,573 60,166 (61)%112,382 241,256 (53)%
Diluted earnings per share0.37 0.94 (61)%1.76 3.74 (53)%

Adjusted operating income (1)
39,206 89,917 (56)%189,705 333,164 (43)%
Adjusted operating margin (1)
4.8 %10.4 %(560) bps5.8 %10.1 %(430) bps
Adjusted net income attributable to Werner (1)
24,639 62,840 (61)%122,721 239,164 (49)%
Adjusted diluted earnings per share (1)
0.39 0.99 (61)%1.93 3.70 (48)%
(1) See attached Reconciliation of Non-GAAP Financial Measures - Consolidated.

Truckload Transportation Services (TTS) Segment

•Revenues of $580.1 million decreased $54.7 million; trucking revenues, net of fuel surcharge, decreased 6%
•Operating income of $34.3 million decreased $46.0 million; non-GAAP adjusted operating income of $37.2 million decreased $45.9 million due to a lower rate per mile in One-Way Truckload, smaller overall fleet size, and lower gains on the sale of property and equipment
•Operating margin of 5.9% decreased 680 basis points from 12.7%
•Non-GAAP adjusted operating margin, net of fuel surcharge, of 7.5% decreased 830 basis points from 15.8%
•Average segment trucks in service totaled 8,168, a decrease of 541 trucks year over year, or 6%
•Dedicated unit trucks at quarter end totaled 5,265, or 66% of the total TTS segment fleet, compared to 5,450 trucks, or 63%, a year ago

Werner Enterprises, Inc. - Release of February 6, 2024
Page 3
•Average revenues per truck per week, net of fuel surcharges, increased 0.2% for TTS and increased 0.9% for Dedicated

During fourth quarter 2023, Dedicated experienced net reduction in average trucks, down 3.3% year over year and down 0.3% sequentially. Dedicated revenue per truck per week increased 0.9% year over year, and despite a highly competitive environment and normal churn, pipeline opportunities remain healthy and client retention remains strong. One-Way Truckload customer freight demand during fourth quarter 2023 was stable with slightly better-than-expected peak volumes, but at significantly reduced pricing compared to the prior-year period. One-Way rate per mile was down 8.6% and fleet size was smaller year over year (down 11.0%), offset with the third consecutive quarter of higher total miles per truck (up 8.7%).

Key Truckload Transportation Services Segment Financial Metrics
Three Months Ended
December 31,		Year Ended
December 31,
(In thousands)20232022Y/Y
Change		20232022Y/Y
Change
Trucking revenues, net of fuel surcharge$487,408 $518,393 (6)%$1,949,445 $1,982,639 (2)%
Trucking fuel surcharge revenues84,675 109,611 (23)%332,388 419,240 (21)%
Non-trucking and other revenues8,010 6,783 18 %28,977 26,807 8 %
Total revenues$580,093 $634,787 (9)%$2,310,810 $2,428,686 (5)%

Operating income		$34,339 $80,341 (57)%$169,330 $294,555 (43)%
Operating margin5.9 %12.7 %(680) bps7.3 %12.1 %(480) bps
Operating ratio94.1 %87.3 %680 bps92.7 %87.9 %480 bps

Adjusted operating income (1)
$37,165 $83,104 (55)%$180,453 $303,902 (41)%
Adjusted operating margin (1)
6.4 %13.1 %(670) bps7.8 %12.5 %(470) bps
Adjusted operating margin, net of fuel surcharge (1)
7.5 %15.8 %(830) bps9.1 %15.1 %(600) bps
Adjusted operating ratio (1)
93.6 %86.9 %670 bps92.2 %87.5 %470 bps
Adjusted operating ratio, net of fuel surcharge (1)
92.5 %84.2 %830 bps90.9 %84.9 %600 bps
(1) See attached Reconciliation of Non-GAAP Financial Measures - Truckload Transportation Services (TTS) Segment.


Werner Logistics Segment

•Revenues of $227.0 million increased $13.5 million, or 6%, including ReedTMS acquisition which closed in November 2022
•Operating income of $4.6 million decreased $5.3 million
•Operating margin of 2.0% decreased 260 basis points from 4.6%
•Adjusted operating income of $3.0 million decreased $5.0 million
•Adjusted operating margin of 1.3% decreased 250 basis points from 3.8%

Truckload Logistics revenues (77% of Logistics revenues) increased 15%, driven by a double-digit increase in shipments (including November 2022 ReedTMS acquisition), partially offset by a decline in revenue per shipment.

Intermodal revenues (12% of Logistics revenues) decreased 27%, due to fewer shipments and lower revenue per shipment year over year; although we achieved the third consecutive quarter of a sequential increase in shipments.

Final Mile revenues (11% of Logistics revenues) increased $1.4 million, or 6%.

Logistics operating income decreased $5.3 million and adjusted operating income decreased $5.0 million in fourth quarter 2023, due to a competitive freight and rate market in fourth quarter 2023 despite generally stronger volume and load growth overall.


Werner Enterprises, Inc. - Release of February 6, 2024
Page 4
Key Werner Logistics Segment Financial Metrics

Three Months Ended
December 31,		Year Ended
December 31,
(In thousands)20232022Y/Y
Change		20232022Y/Y
Change
Total revenues$226,963 $213,485 6 %$910,433 $793,492 15 %
Operating expenses:
  Purchased transportation expense193,132 174,463 11 %761,948 653,185 17 %
  Other operating expenses29,256 29,154 0 %132,606 104,123 27 %
    Total operating expenses222,388 203,617 9 %894,554 757,308 18 %
Operating income$4,575 $9,868 (54)%$15,879 $36,184 (56)%
Operating margin2.0 %4.6 %(260) bps1.7 %4.6 %(290) bps
Adjusted operating income (1)
$3,023 $8,028 (62)%$18,045 $35,844 (50)%
Adjusted operating margin (1)
1.3 %3.8 %(250) bps2.0 %4.5 %(250) bps
(1) See attached Reconciliation of Non-GAAP Financial Measures - Werner Logistics Segment.



Cash Flow and Capital Allocation

Cash flow from operations in fourth quarter 2023 was $118.3 million compared to $116.0 million in fourth quarter 2022, an increase of 2%. Operating cash flow margins improved greater than 90 basis points for fourth quarter 2023 to 14% of operating revenues and increased 80 basis points year to date 2023 to 14% of operating revenues.

Net capital expenditures in fourth quarter 2023 were $34.5 million compared to $63.5 million in fourth quarter 2022, a decrease of 46%. We plan to continue to invest in new trucks, trailers and our terminals to improve our driver experience, optimize operational efficiency and more effectively manage our maintenance, safety and fuel costs. The average ages of our truck and trailer fleets were 2.1 years and 4.9 years, respectively, as of December 31, 2023.

Gains on sales of property and equipment in fourth quarter 2023 were $3.1 million, or $0.04 per share, compared to $25.9 million, or $0.30 per share, in fourth quarter 2022. Year over year, we sold 11% fewer trucks and over 60% more trailers and realized substantially lower average gains per truck and trailer. Gains on sales of property and equipment are reflected as a reduction of Other Operating Expenses in our income statement.

We did not repurchase shares of our common stock in fourth quarter 2023. As of December 31, 2023, we had 2.3 million shares remaining under our share repurchase authorization.

As of December 31, 2023, we had $62 million of cash and cash equivalents and $1.5 billion of stockholders’ equity. Total debt outstanding was $649 million at December 31, 2023. After considering letters of credit issued, we had available liquidity consisting of cash and cash equivalents and available borrowing capacity as of December 31, 2023 of $526 million.











Werner Enterprises, Inc. - Release of February 6, 2024
Page 5
Introducing 2024 Guidance

2023 Guidance
(as of 11/1/23)		2023 Actual
(as of 12/31/23)		2024 Guidance
(as of 2/6/24)
TTS truck count from BoY to EoY(5)% to (3)%
(annual)		(7)%
(2023)		(3)% to 0%
(annual)
Net capital expenditures$425M to $450M
(annual)		$409M
(2023)		$260M to $310M
(annual)
TTS Guidance
Dedicated RPTPW* growth0% to 3%
(annual)
1.5%
(2023) 		0% to 3%
(annual)
One-Way Truckload RPTM* growth(9)% to (7)%
(4Q23 vs. 4Q22)		(8.6)%
(4Q23 vs. 4Q22)		(6)% to (3)%
(1H24 vs. 1H23)
* Net of fuel surcharge revenues
Assumptions

•Effective income tax rate of 24.5% to 25.5% in 2024 compared to 24.0% in 2023.
•Expect average truck age of 2.1 years and average trailer age of 5.0 years as of 12/31/24, compared to 2.1 years and 4.9 years as of 12/31/23, respectively.






















Werner Enterprises, Inc. - Release of February 6, 2024
Page 6
Call Information

Werner Enterprises, Inc. will conduct a conference call to discuss fourth quarter 2023 earnings today beginning at 4:00 p.m. CT. The news release, live webcast of the earnings conference call, and accompanying slide presentation will be available at werner.com in the “Investors” section under “News & Events” and then “Events Calendar.” To participate in the conference call, please dial (844) 701-1165 (domestic) or (412) 317-5498 (international). Please mention to the operator that you are dialing in for the Werner Enterprises call.

A replay of the conference call will be available on February 6, 2024 at approximately 6:00 p.m. CT through March 6, 2024 by dialing (877) 344-7529 (domestic) or (412) 317-0088 (international) and using the access code 1321524. A replay of the webcast will also be available at werner.com in the “Investors” section under “News & Events” and then “Events Calendar.”

About Werner Enterprises

Werner Enterprises, Inc. (Nasdaq: WERN) delivers superior truckload transportation and logistics services to customers across the United States, Mexico and Canada. With 2023 revenues of $3.3 billion, an industry-leading modern truck and trailer fleet, nearly 14,000 talented associates and our innovative Werner EDGE® technology, we are an essential solutions provider for customers who value the integrity of their supply chain and require safe and exceptional on-time service. Werner provides Dedicated and One-Way Truckload services as well as Logistics services that include truckload brokerage, freight management, intermodal and final mile. As an industry leader, Werner is deeply committed to promoting sustainability and supporting diversity, equity and inclusion.

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements are based on information presently available to the Company’s management and are current only as of the date made. Actual results could also differ materially from those anticipated as a result of a number of factors, including, but not limited to, those discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 and subsequently filed Quarterly Reports on Form 10-Q.

For those reasons, undue reliance should not be placed on any forward-looking statement. The Company assumes no duty or obligation to update or revise any forward-looking statement, although it may do so from time to time as management believes is warranted or as may be required by applicable securities law. Any such updates or revisions may be made by filing reports with the U.S. Securities and Exchange Commission (“SEC”), through the issuance of press releases or by other methods of public disclosure.



Contact:
Christopher D. Wikoff
Executive Vice President, Treasurer
and Chief Financial Officer
(402) 894-3700

Source: Werner Enterprises, Inc.





Werner Enterprises, Inc. - Release of February 6, 2024
Page 7
Consolidated Financial Information

INCOME STATEMENT
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended
December 31,		Year Ended
December 31,
2023202220232022
$%$%$%$%
Operating revenues$821,945 100.0 $861,491 100.0 $3,283,499 100.0 $3,289,978 100.0 
Operating expenses:
Salaries, wages and benefits
269,816 32.8 260,531 30.2 1,072,558 32.7 1,020,609 31.0 
Fuel
85,478 10.4 111,447 12.9 345,001 10.5 437,299 13.3 
Supplies and maintenance
63,124 7.7 65,406 7.6 256,494 7.8 253,096 7.7 
Taxes and licenses
25,999 3.2 25,289 2.9 102,684 3.1 97,929 3.0 
Insurance and claims
33,964 4.1 44,301 5.2 138,516 4.2 147,365 4.5 
Depreciation and amortization75,712 9.2 73,826 8.6 299,509 9.1 279,923 8.5 
Rent and purchased transportation
224,418 27.3 207,662 24.1 886,284 27.0 777,464 23.6 
Communications and utilities
4,523 0.6 4,429 0.5 18,480 0.6 15,856 0.5 
Other
979 0.1 (19,781)(2.3)(12,443)(0.4)(62,639)(1.9)
Total operating expenses
784,013 95.4 773,110 89.7 3,107,083 94.6 2,966,902 90.2 
Operating income37,932 4.6 88,381 10.3 176,416 5.4 323,076 9.8 
Other expense (income):
Interest expense
8,819 1.1 5,824 0.7 33,535 1.0 11,828 0.4 
Interest income
(1,523)(0.2)(751)(0.1)(6,701)(0.2)(1,731)(0.1)
 Loss (gain) on investments in equity securities, net242 — 2,208 0.3 278 — (12,195)(0.4)
Loss from equity method investment92 — — — 1,046 0.1 — — 
Other
100 — 112 — 477 — 388 — 
Total other expense (income)7,730 0.9 7,393 0.9 28,635 0.9 (1,710)(0.1)
Income before income taxes30,202 3.7 80,988 9.4 147,781 4.5 324,786 9.9 
Income tax expense6,970 0.9 19,977 2.3 35,491 1.1 79,206 2.4 
   Net income23,232 2.8 61,011 7.1 112,290 3.4 245,580 7.5 
Net loss (income) attributable to noncontrolling interest341 0.1 (845)(0.1)92 — (4,324)(0.2)
   Net income attributable to Werner$23,573 2.9 $60,166 7.0 $112,382 3.4 $241,256 7.3 
Diluted shares outstanding63,780  63,695 63,718 64,579 
Diluted earnings per share$0.37 $0.94 $1.76 $3.74 



Werner Enterprises, Inc. - Release of February 6, 2024
Page 8
CONDENSED BALANCE SHEET
(In thousands, except share amounts)
December 31,
2023		December 31,
2022
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$61,723 $107,240 
Accounts receivable, trade, less allowance of $9,337 and $10,271, respectively444,944 518,815 
Other receivables 25,479 29,875 
Inventories and supplies
18,077 14,527 
Prepaid taxes, licenses and permits
16,505 17,699 
   Other current assets67,900 74,459 
Total current assets
634,628 762,615 

Property and equipment		2,951,654 2,885,641 
Less – accumulated depreciation978,698 1,060,365 
Property and equipment, net
1,972,956 1,825,276 

Goodwill		129,104 132,717 
Intangible assets, net86,477 81,502 
Other non-current assets (1)
334,771 295,145 
Total assets$3,157,936 $3,097,255 
LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$135,990 $124,483 
Current portion of long-term debt
2,500 6,250 
Insurance and claims accruals81,794 78,620 
Accrued payroll
50,549 49,793 
Accrued expenses30,282 20,358 
Other current liabilities
29,470 30,016 
Total current liabilities
330,585 309,520 

Long-term debt, net of current portion		646,250 687,500 
Other long-term liabilities54,275 59,677 
Insurance and claims accruals, net of current portion (1)
239,700 244,946 
Deferred income taxes320,180 313,278 
Total liabilities1,590,990 1,614,921 
Temporary equity - redeemable noncontrolling interest38,607 38,699 

Stockholders’ equity:
Common stock, $.01 par value, 200,000,000 shares authorized; 80,533,536
  shares issued; 63,444,681 and 63,223,003 shares outstanding, respectively
805 805 
Paid-in capital
134,894 129,837 
Retained earnings
1,953,385 1,875,873 
Accumulated other comprehensive loss(9,684)(11,292)
Treasury stock, at cost; 17,088,855 and 17,310,533 shares, respectively(551,061)(551,588)
Total stockholders’ equity1,528,339 1,443,635 
Total liabilities, temporary equity and stockholders’ equity$3,157,936 $3,097,255 
(1) Under the terms of our insurance policies, we are the primary obligor of the damage award in a previously disclosed adverse jury verdict, and as such, we have recorded a $79.2 million receivable from our third-party insurance providers in other non-current assets and a corresponding liability of the same amount in the long-term portion of insurance and claims accruals in the unaudited condensed balance sheets as of December 31, 2023 and 2022.




Werner Enterprises, Inc. - Release of February 6, 2024
Page 9
SUPPLEMENTAL INFORMATION
(Unaudited)
(In thousands)
Three Months Ended
December 31,		Year Ended
December 31,
2023202220232022
Capital expenditures, net$34,537 $63,507 $408,698 $317,579 
Cash flow from operations118,347 115,995 474,366 448,711 
Return on assets (annualized)2.9 %8.2 %3.6 %8.8 %
Return on equity (annualized)6.0 %16.8 %7.3 %17.5 %


Segment Financial and Operating Statistics Information

SEGMENT INFORMATION
(Unaudited)
(In thousands)
Three Months Ended
December 31,		Year Ended
December 31,
2023202220232022
Revenues
Truckload Transportation Services$580,093 $634,787 $2,310,810 $2,428,686 
Werner Logistics226,963 213,485 910,433 793,492 
Other (1)
18,974 16,257 78,063 71,185 
Corporate420 431 1,883 1,833 
    Subtotal826,450 864,960 3,301,189 3,295,196 
Inter-segment eliminations (2)
(4,505)(3,469)(17,690)(5,218)
     Total$821,945 $861,491 $3,283,499 $3,289,978 

Operating Income (Loss)
Truckload Transportation Services$34,339 $80,341 $169,330 $294,555 
Werner Logistics4,575 9,868 15,879 36,184 
Other (1)
(244)(2,419)69 (2,604)
Corporate(738)591 (8,862)(5,059)
     Total$37,932 $88,381 $176,416 $323,076 

(1) Other includes our driver training schools, transportation-related activities such as third-party equipment maintenance and equipment leasing, and other business activities.
(2) Inter-segment eliminations represent transactions between reporting segments that are eliminated in consolidation.

Werner Enterprises, Inc. - Release of February 6, 2024
Page 10
OPERATING STATISTICS BY SEGMENT
(Unaudited)
Three Months Ended
December 31,		Year Ended
December 31,
20232022% Chg20232022% Chg
Truckload Transportation Services segment
Average trucks in service8,168 8,709 (6.2)%8,326 8,437 (1.3)%
Average revenues per truck per week (1)
$4,590 $4,579 0.2 %$4,502 $4,519 (0.4)%
Total trucks (at quarter end)
Company7,740 8,305 (6.8)%7,740 8,305 (6.8)%
Independent contractor260 295 (11.9)%260 295 (11.9)%
Total trucks8,000 8,600 (7.0)%8,000 8,600 (7.0)%
Total trailers (at quarter end)27,850 27,650 0.7 %27,850 27,650 0.7 %

One-Way Truckload
Trucking revenues, net of fuel surcharge (in 000’s)$178,118 $201,460 (11.6)%$713,762 $766,013 (6.8)%
Average trucks in service2,929 3,292 (11.0)%3,042 3,153 (3.5)%
Total trucks (at quarter end)2,735 3,150 (13.2)%2,735 3,150 (13.2)%
Average percentage of empty miles14.92 %13.58 %9.9 %14.36 %12.70 %13.1 %
Average revenues per truck per week (1)
$4,678 $4,708 (0.6)%$4,512 $4,672 (3.4)%
Average % change YOY in revenues per total mile (1)
(8.6)%0.4 %(5.5)%8.6 %
Average % change YOY in total miles per truck per week8.7 %(4.6)%2.2 %(7.4)%
Average completed trip length in miles (loaded)594 633 (6.2)%595 675 (11.9)%

Dedicated
Trucking revenues, net of fuel surcharge (in 000’s)$309,290 $316,933 (2.4)%$1,235,683 $1,216,626 1.6 %
Average trucks in service5,239 5,417 (3.3)%5,284 5,284 — %
Total trucks (at quarter end)5,265 5,450 (3.4)%5,265 5,450 (3.4)%
Average revenues per truck per week (1)
$4,541 $4,501 0.9 %$4,496 $4,428 1.5 %

Werner Logistics segment
Average trucks in service39 45 (13.3)%37 52 (28.8)%
Total trucks (at quarter end)35 39 (10.3)%35 39 (10.3)%
Total trailers (at quarter end)2,960 2,315 27.9 %2,960 2,315 27.9 %
(1) Net of fuel surcharge revenues


Non-GAAP Financial Measures and Reconciliations

To supplement our financial results presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”), we provide certain non-GAAP financial measures as defined by the SEC Regulation G, including non-GAAP adjusted operating income; non-GAAP adjusted operating margin; non-GAAP adjusted operating margin, net of fuel surcharge; non-GAAP adjusted net income attributable to Werner; non-GAAP adjusted diluted earnings per share; non-GAAP adjusted operating revenues, net of fuel surcharge; non-GAAP adjusted operating expenses; non-GAAP adjusted operating expenses, net of fuel surcharge; non-GAAP adjusted operating ratio; and non-GAAP adjusted operating ratio, net of fuel surcharge. We believe these non-GAAP financial measures provide a more useful comparison of our performance from period to period because they exclude the effect of items that, in our opinion, do not reflect our core operating performance. Our non-GAAP financial measures are not meant to be considered in isolation or as substitutes for their comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. There are limitations to using non-GAAP financial measures. Although we believe that they improve comparability in analyzing our period to period performance, they could limit comparability to other companies in our industry if those companies define these measures differently. Because of these limitations, our non-GAAP financial measures should not be considered measures of income generated by our business. Management compensates for these limitations by primarily relying on GAAP results and using non-GAAP financial measures on a supplemental basis.


Werner Enterprises, Inc. - Release of February 6, 2024
Page 11
The following tables present reconciliations of each non-GAAP financial measure to its most directly comparable GAAP financial measure as required by SEC Regulation G. In addition, information regarding each of the excluded items as well as our reasons for excluding them from our non-GAAP results is provided below.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – CONSOLIDATED
(unaudited)
(In thousands, except per share amounts)
Three Months Ended December 31,Year Ended December 31,
2023202220232022
Non-GAAP Adjusted Operating Income and
Non-GAAP Adjusted Operating Margin (1)
$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.
Operating income and operating margin – (GAAP)$37,932 4.6 %$88,381 10.3 %$176,416 5.4 %$323,076 9.8 %
Non-GAAP adjustments:
Insurance and claims (2)
1,457 0.2 %1,387 0.1 %5,664 0.2 %5,394 0.2 %
Amortization of intangible assets (3)
2,517 0.3 %2,036 0.2 %10,325 0.3 %6,113 0.2 %
Acquisition expenses (4)
— — %613 0.1 % — — %1,081 — %
Contingent consideration adjustments (5)
(2,700)(0.3)%(2,500)(0.3)%(2,700)(0.1)%(2,500)(0.1)%
Non-GAAP adjusted operating income and
  non-GAAP adjusted operating margin
$39,206 4.8 % $89,917 10.4 %$189,705 5.8 %$333,164 10.1 %


Three Months Ended December 31,Year Ended December 31,
2023202220232022
Non-GAAP Adjusted Net Income
Attributable to Werner and Non-GAAP
Adjusted Diluted EPS (1)
$Diluted EPS$Diluted EPS$Diluted EPS$Diluted EPS
Net income attributable to Werner and diluted EPS – (GAAP)$23,573 $0.37 $60,166 $0.94 $112,382 $1.76 $241,256 $3.74 
Non-GAAP adjustments:
Insurance and claims (2)
1,457 0.02 1,387 0.02 5,664 0.09 5,394 0.08 
Amortization of intangible assets, net of amount attributable to noncontrolling interest (3)
2,345 0.04 1,864 0.03 9,637 0.15 5,425 0.08 
Acquisition expenses (4)
— — 613 0.01 — — 1,081 0.02 
Contingent consideration adjustments (5)
(2,700)(0.04)(2,500)(0.04)(2,700)(0.04)(2,500)(0.04)
Loss (gain) on investments in equity securities, net (6)
242 — 2,208 0.04 278 0.01 (12,195)(0.19)
Loss from equity method investment (7)
92 — — — 1,046 0.02 — — 
Income tax effect of above adjustments (8)
(370)— (898)(0.01)(3,586)(0.06)703 0.01 
Non-GAAP adjusted net income attributable to
   Werner and non-GAAP adjusted diluted EPS
$24,639 $0.39  $62,840 $0.99 $122,721 $1.93 $239,164 $3.70 


 Three Months Ended
December 31,		Year Ended
December 31,
2023202220232022
Non-GAAP Adjusted Operating Revenues, Net of Fuel Surcharge (1)
$$$$
Operating revenues – (GAAP)$821,945 $861,491 $3,283,499 $3,289,978 
Non-GAAP adjustment:
Trucking fuel surcharge (9)
(84,675)(109,611)(332,388)(419,240)
Non-GAAP Operating revenues, net of fuel surcharge$737,270 $751,880 $2,951,111 $2,870,738 







Werner Enterprises, Inc. - Release of February 6, 2024
Page 12
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – TRUCKLOAD TRANSPORTATION SERVICES (TTS) SEGMENT
(unaudited)
(In thousands)
Three Months Ended December 31,Year Ended December 31,
2023202220232022
Non-GAAP Adjusted Operating Income and
Non-GAAP Adjusted Operating Margin (1)
$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.
Operating income and operating margin – (GAAP)$34,339 5.9 %$80,341 12.7 %$169,330 7.3 %$294,555 12.1 %
Non-GAAP adjustments:
Insurance and claims (2)
1,457 0.3 %1,387 0.2 %5,664 0.3 %5,394 0.2 %
Amortization of intangible assets (3)
1,369 0.2 %1,376 0.2 %5,459 0.2 %3,953 0.2 %
Non-GAAP adjusted operating income and
  non-GAAP adjusted operating margin
$37,165 6.4 % $83,104 13.1 %$180,453 7.8 %$303,902 12.5 %

Three Months Ended December 31,Year Ended December 31,
2023202220232022
Non-GAAP Adjusted Operating Expenses and
Non-GAAP Adjusted Operating Ratio (1)
$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.
Operating expenses and operating ratio – (GAAP)$545,754 94.1 %$554,446 87.3 %$2,141,480 92.7 %$2,134,131 87.9 %
Non-GAAP adjustments:
Insurance and claims (2)
(1,457)(0.3)%(1,387)(0.2)%(5,664)(0.3)%(5,394)(0.2)%
Amortization of intangible assets (3)
(1,369)(0.2)%(1,376)(0.2)%(5,459)(0.2)%(3,953)(0.2)%
Non-GAAP adjusted operating expenses and
  non-GAAP adjusted operating ratio
$542,928 93.6 % $551,683 86.9 %$2,130,357 92.2 %$2,124,784 87.5 %

Three Months Ended
December 31,		Year Ended
December 31,
Non-GAAP Adjusted Operating Expenses, Net of Fuel Surcharge;
Non-GAAP Adjusted Operating Margin, Net of Fuel Surcharge;
and Non-GAAP Adjusted Operating Ratio, Net of Fuel Surcharge (1)
2023202220232022
$$$$
Operating revenues – (GAAP)$580,093 $634,787 $2,310,810 $2,428,686 
Less: Trucking fuel surcharge (9)
(84,675)(109,611)(332,388)(419,240)
Operating revenues, net of fuel surcharge – (Non-GAAP)495,418 525,176 1,978,422 2,009,446 
Operating expenses – (GAAP)545,754 554,446 2,141,480 2,134,131 
Non-GAAP adjustments:
Trucking fuel surcharge (9)
(84,675)(109,611)(332,388)(419,240)
Insurance and claims (2)
(1,457)(1,387)(5,664)(5,394)
Amortization of intangible assets (3)
(1,369)(1,376)(5,459)(3,953)
Non-GAAP adjusted operating expenses, net of fuel surcharge 458,253  442,072 1,797,969 1,705,544 
Non-GAAP adjusted operating income$37,165 $83,104 $180,453 $303,902 
Non-GAAP adjusted operating margin, net of fuel surcharge7.5 %15.8 %9.1 %15.1 %
Non-GAAP adjusted operating ratio, net of fuel surcharge92.5 %84.2 %90.9 %84.9 %

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES – WERNER LOGISTICS SEGMENT
(unaudited)
(In thousands)
Three Months Ended December 31,Year Ended December 31,
2023202220232022
Non-GAAP Adjusted Operating Income and
Non-GAAP Adjusted Operating Margin (1)
$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.$% of Op. Rev.
Operating income and operating margin – (GAAP)$4,575 2.0 %$9,868 4.6 %$15,879 1.7 %$36,184 4.6 %
Non-GAAP adjustments:
Amortization of intangible assets (3)
1,148 0.5 %660 0.3 %4,866 0.6 %2,160 0.2 %
Contingent consideration adjustment (5)
(2,700)(1.2)%(2,500)(1.1)%(2,700)(0.3)%(2,500)(0.3)%
Non-GAAP adjusted operating income and
  non-GAAP adjusted operating margin
$3,023 1.3 % $8,028 3.8 %$18,045 2.0 %$35,844 4.5 %


Werner Enterprises, Inc. - Release of February 6, 2024
Page 13
(1) Non-GAAP adjusted operating income; non-GAAP adjusted operating margin; non-GAAP adjusted operating margin, net of fuel surcharge; non-GAAP adjusted net income attributable to Werner; non-GAAP adjusted diluted earnings per share; non-GAAP adjusted operating revenues, net of fuel surcharge; non-GAAP adjusted operating expenses; non-GAAP adjusted operating expenses, net of fuel surcharge; non-GAAP adjusted operating ratio; and non-GAAP adjusted operating ratio, net of fuel surcharge should be considered in addition to, rather than as substitutes for, GAAP operating income; GAAP operating margin; GAAP net income attributable to Werner; GAAP diluted earnings per share; GAAP operating revenues; GAAP operating expenses; and GAAP operating ratio, which are their most directly comparable GAAP financial measures.

(2) We accrued pre-tax insurance and claims expense for interest related to a previously disclosed excess adverse jury verdict rendered on May 17, 2018 in a lawsuit arising from a December 2014 accident. The Company is appealing this verdict. Additional information about the accident was included in our Current Report on Form 8-K dated May 17, 2018. Under our insurance policies in effect on the date of this accident, our maximum liability for this accident is $10.0 million (plus pre-judgment and post-judgment interest) with premium-based insurance coverage that exceeds the jury verdict amount. We continue to accrue pre-tax insurance and claims expense for interest at $0.5 million per month until such time as the outcome of our appeal is finalized. Management believes excluding the effect of this item provides a more useful comparison of our performance from period to period. This item is included in our Truckload Transportation Services segment in our Segment Information table.

(3) Amortization expense related to intangible assets acquired in our business acquisitions is excluded because management does not believe it is indicative of our core operating performance. This item is included in our Truckload Transportation Services and Werner Logistics segments.

(4) We incurred business acquisition-related expenses including legal and professional fees. Acquisition-related expenses are excluded as management believes these costs are not representative of the costs of managing our on-going business. The expenses are included within other operating expenses in our Income Statement and in Corporate operating income in our Segment Information table.

(5) Contingent consideration, also referred to as earnout, adjustments related to our business acquisitions are excluded because management does not believe these adjustments are indicative of our core operating performance. These adjustments are recorded in other operating expenses in our Income Statement and are included in our Werner Logistics segment.

(6) Represents non-operating mark-to-market adjustments for gains/losses on our minority equity investments, which we account for under Accounting Standards Codification (“ASC”) 321, Investments – Equity Securities. Management believes excluding the effect of gains/losses on our investments in equity securities provides a more useful comparison of our performance from period to period. We record changes in the value of our investments in equity securities in other expense (income) in our Income Statement.

(7) Represents earnings/losses from our equity method investment, which we account for under ASC 323, Investments - Equity Method and Joint Ventures. Management believes excluding the effect of earnings/losses from our equity method investment provides a more useful comparison of our performance from period to period. We record earnings/losses from our equity method investment in other expense (income) in our Income Statement.

(8) The income tax effect of the non-GAAP adjustments is calculated using the incremental income tax rate excluding discrete items, and the income tax effect for 2023 has been updated to reflect the annual incremental income tax rate.

(9) Fluctuating fuel prices and fuel surcharge revenues impact the total company operating ratio and the TTS segment operating ratio when fuel surcharges are reported on a gross basis as revenues versus netting the fuel surcharges against fuel expenses. Management believes netting fuel surcharge revenues, which are generally a more volatile source of revenue, against fuel expenses provides a more consistent basis for comparing the results of operations from period to period.

v3.24.0.1
Document and Entity Information Document
Feb. 06, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 06, 2024
Entity File Number 0-14690
Entity Registrant Name WERNER ENTERPRISES, INC.
Entity Central Index Key 0000793074
Amendment Flag false
Entity Incorporation, State or Country Code NE
Entity Tax Identification Number 47-0648386
Entity Address, Address Line One 14507 Frontier Road
Entity Address, Address Line Two Post Office Box 45308
Entity Address, City or Town Omaha
Entity Address, State or Province NE
Entity Address, Postal Zip Code 68145-0308
City Area Code 402
Local Phone Number 895-6640
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.01 Par Value
Trading Symbol WERN
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
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