Home Safety Apparel Covenant beats expectations, delivers upbeat forecast

Covenant beats expectations, delivers upbeat forecast

Covenant Logistics Group reported Wednesday after the market close fourth-quarter earnings of $1.07 per share on total revenue of $294.2 million, a 31% increase compared to the same period in 2020.

Covenant beat analysts’ expectations for earnings per share of $1.04 and revenue of $282 million in Q4 2021. It was the second consecutive quarter the company topped estimates for earnings and revenue.

Covenant’s (NASDAQ: CVLG) total freight revenue excluding fuel surcharges increased 27% year-over-year to $267 million.

The Chattanooga, Tennessee-based truckload carrier said the outlook is for continued operational progress during 2022.

“For at least the first few months of 2022, we anticipate a strong freight market accompanied by constrained capacity due to a national driver and equipment shortage,” David R. Parker, Covenant’s chairman and CEO, said in a statement.  

Covenant’s managed freight division posted the largest gain during the fourth quarter, increasing revenue $43.2 million, or 66.7%, year-over-year to $108.1 million.

“Managed freight’s favorable results for the quarter were primarily attributable to the robust freight market, executing various spot rate opportunities and handling overflow freight from both expedited and dedicated truckload operations,” Parker said.

Covenant Logistics Group Q4/21 Q4/20 Y/Y% Change
Total Revenue $294.2 $225.2 30.7%
Truckload Combined:
Freight Revenue (ex fuel) $142.6 $131.4 8.5%
Average Tractors 2,294 2,480 (7.5%)
Revenue per Loaded Mile $2.53 $2.11 19.9%
Revenue per Total Mile $2.24 $1.90 17.8%
Revenue/Tractor/Week $4,732 $4,032 17.3%
Adjusted OR% 96% 97.9% (1.9%)
Managed Freight:
Revenue $108.1 $64.8 66.7%
Adjusted Operating Income $11 $5.5 107%
Adjusted OR% 89.8% 91.5% (1.8%)
Expedited Freight:
Revenue (ex fuel) $71.7 $69.4 3.3%
Adjusted Operating Income $5.5 $6.1 (9.8%)
Adjusted OR% 92.2% 91.2% 1%
Dedicated Freight:
Revenue (ex fuel) $70.8 $61.9 14.3%
Adjusted Operating Income $1.5 $73k 2042%
Adjusted OR% 97.8% 99.9% (2.1%)
Adjusted EPS $1.07 $0.61 75.4%
Revenue & operating income in millions

Revenue in the company’s combined truckload operations increased 16.5% to $169.7 million. Covenant’s tractor count for the quarter declined 7.5% to 2,294, while the trailer count declined 5.6% to 5,331.

Revenue per tractor per week increased 17% to $4,732. Miles per tractor declined less than 1% year-over-year to 27,805 during the fourth quarter, while freight revenue per total miles increased from $1.90 to $2.24.

The combined truckload segment posted a 96% adjusted operating ratio during the fourth quarter, compared to 97.9% during the same period in 2020.

Covenant’s expedited segment posted revenue of $71.7 million during the quarter, a 3.4% increase from the prior-year period. Dedicated freight saw revenue increase 14.4% year-over-year to $70.8 million.

For the fourth quarter, Covenant’s warehousing freight revenue increased 11.4% to $16.2 million.

The company will host a call at 10 a.m. Thursday to discuss the fourth-quarter results with analysts.

The FREIGHTWAVES TOP 500 For-Hire Carriers list includes Covenant Logistics Group (No. 45).

Click for more FreightWaves articles by Noi Mahoney.

More articles by Noi Mahoney

From ice cream delivery to pharmaceutical transport, reefers wear many hats

Mexico’s commercial truck makers finish year on high note

Can US cash in on reshoring manufacturing opportunities?

Most Popular

Nashville school shooting: Officers who took out suspected Covenant shooter identified

The two police officers who fatally shot the suspect of the Covenant School shooting in Nashville on Monday have been identified.Metropolitan Nashville Police Chief...

Kevin McCarthy says House ‘will be moving forward’ with TikTok legislation

House Speaker Kevin McCarthy, R-Calif., said Sunday that lawmakers "will be moving forward" with legislation to address national security concerns surrounding TikTok after the...

GOP senators introduce measure to overturn Biden’s student debt forgiveness plan

WASHINGTON — A group of Republican senators unveiled a proposal Monday to revoke President Joe Biden's executive action last year to forgive some federal...

Extreme weather meets reality of poverty to create a tragedy in Mississippi

The tornado that hit Rolling Fork was also an intense, fast-moving storm that struck under the cover of night, when visibility is low and...