8-K
FORWARD AIR CORP (FWRD)
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 26, 2025
FORWARD AIR CORPORATION
(Exact name of registrant as specified in its charter)
| TN | 62-1120025 | |||||
|---|---|---|---|---|---|---|
| (State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) | |||||
| 1915 Snapps Ferry Road | Building N | Greeneville | TN | 37745 | ||
| (Address of principal executive offices) | (Zip Code) | 000-22490 | ||||
| --- | ||||||
| (Commission File Number) |
Registrant's telephone number, including area code: (423) 636-7000
| Not Applicable |
|---|
| (Former name or former address, if changed since last report) |
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 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.01 par value | FWRD | NASDAQ |
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. o
SECTION 2. FINANCIAL INFORMATION.
Item 2.02. Results of Operations and Financial Condition.
On February 26, 2025, Forward Air Corporation (the "Company") issued a press release (the "Press Release") announcing its financial results for the three and twelve months ended December 31, 2024. On February 26, 2025, the Company also posted an Earnings Presentation (the "Earnings Presentation"), dated February 26, 2025, on the Company’s Investor Relations website at ir.forwardaircorp.com.
Copies of the Press Release and Earnings Presentation are being furnished as Exhibits 99.1 and 99.2, attached hereto, respectively, and are incorporated herein by reference. The information furnished pursuant to Items 2.02 and 9.01, including Exhibits 99.1 and 99.2, 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 under that Section, and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.
SECTION 9. FINANCIAL STATEMENTS AND EXHIBITS.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. The following exhibits are being furnished as part of this Report.
| No. | Exhibit | |
|---|---|---|
| 99.1 | Press Release of Forward Air Corporation, datedFebruary 26, 2025 | |
| 99.2 | Forward AirYearEnd2024 Earnings and Business Update Presentation Slides | |
| 104 | Cover Page Interactive File (the cover page tags are embedded within the Inline XBRL document) |
SIGNATURE
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.
| FORWARD AIR CORPORATION | ||
|---|---|---|
| Date: February 26, 2025 | By: | /s/ Shawn Stewart |
| Shawn Stewart<br><br>Chief Executive Officer |
Document
NEWS RELEASE
FORWARD AIR CORPORATION REPORTS FOURTH QUARTER AND FULL YEAR 2024 RESULTS
Full year results near the top end of guidance range
Executed more than $100 million in annualized cost synergies in first year following Omni transaction
Transitioning from Integration to Transformation
GREENEVILLE, Tenn.- (BUSINESS WIRE) - February 26, 2025 - Forward Air Corporation (NASDAQ:FWRD) (the “Company”, “Forward Air”, “we”, “our”, or “us”) today reported financial results for the three and twelve months ended December 31, 2024 as presented in the tables below on a continuing operations basis, with the Company’s former Final Mile business being reported as discontinued operations.
“As we turn the page on the first year operating as a combined company following the acquisition of Omni, I want to express my gratitude to our associates for their dedication to making our customers their top priority,” said Shawn Stewart, Chief Executive Officer. “We kept our focus on stabilizing the Company and integrating the Forward Air and Omni’s networks, and I am pleased with the pace and rigor of our work. We delivered full year 2024 Consolidated EBITDA results near the top end of our guidance range, and we more than delivered on the previously committed $75 million of integration synergies. Combining the integration synergies with additional cost saving actions and other efficiency initiatives executed throughout the year, we delivered more than $100 million in annualized savings. While we have more work to do, I am proud of what we accomplished and I expect the foundational changes and investments made in 2024, coupled with the broader transformation we are embarking on, to improve our results and benefit the Company for many years to come."
“As a combined company, we are equipped with an enhanced suite of global, vertically-integrated services to meet our customers’ needs. Our integration and continued operational initiatives are creating a more efficient, nimble and unified company, which we believe better enable us to leverage both networks and provide best-in-class solutions and service to our customers."
“The team that we assembled has made significant progress over a very short period and watching how they have worked together gives me a great deal of confidence as we look ahead and with our new chief commercial officer in place we expect to be playing a lot more offense than we have been since the combination. As we move to the growth phase of our evolution, our priorities in 2025 include technology system simplification and rationalization, global shared service efficiencies and expanding synergistic service offerings for our customers both domestically and around the world,” concluded Stewart.
Jamie Pierson, Chief Financial Officer added, “For the fourth quarter 2024, we reported consolidated revenue of $633 million and income from continuing operations of $76 million which includes a goodwill impairment adjustment of $79 million that favorably impacted the quarter. On a segment basis, Omni Logistics’ income from operations was favorably impacted by the goodwill impairment adjustment, and it reported its best quarterly reported EBITDA since the transaction. The Intermodal segment maintained its steady performance and improved income from operations compared to a year ago. However, the Expedited Freight segment was negatively impacted by a pricing strategy put in place prior to the acquisition that focused more on growing volume than profitability. We implemented corrective pricing actions during the fourth quarter and are beginning to see results in line with our expectations. We expect to see the full run rate of these actions by the end of February.
“For the fourth quarter, Consolidated EBITDA ("Consolidated EBITDA"), a non-GAAP measure calculated pursuant to our Senior Secured Term Loan Credit Agreement (the "Credit Agreement"), was $69 million. For the full year, 2024 Consolidated EBITDA was $308 million, which resulted in an approximate $59 million cushion per the terms of the recently amended Credit Agreement’s consolidated first lien net leverage ratio covenant. While we are proud of our collective accomplishments, there is more to do, and we are by no means satisfied with the results nor are we finished combining and transforming this now global opportunity.
“Liquidity at the end of the fourth quarter was $382 million compared to $460 million at the end of the third quarter. The quarter-over-quarter change was impacted by a $40 million reduction to the size of the credit facility in conjunction with the recent amendment to the credit agreement and $60 million in interest payments made in the fourth quarter. Overall, I’m encouraged by the trends in cash flow in the second half of the year as we reduced acquisition-related costs and integration expenses compared to the first half of the year. The focus on reducing these items contributed to an increase of $20 million in cash and cash equivalents from the end of the second quarter through the end of the year,” concluded Pierson.
| Continuing Operations | Three Months Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| (in thousands, except per share data) | December 31, 2024 | December 31, 2023 | Change | Percent Change | ||||||
| Operating revenue | $ | 632,846 | $ | 338,428 | $ | 294,418 | 87.0 | % | ||
| Income from operations | 75,855 | $ | 3,000 | $ | 72,855 | 2,428.5 | % | |||
| Operating margin | 12.0 | % | 0.9 | % | 1,110 bps | |||||
| Net income | $ | (35,378) | $ | (14,721) | $ | (20,657) | 140.3 | % | ||
| Net income per diluted share | $ | (1.23) | $ | (0.58) | $ | (0.65) | 112.1 | % | ||
| Cash provided by operating activities | $ | (30,492) | $ | 57,092 | $ | (87,584) | (153.4) | % | ||
| Non-GAAP Financial Measures: 1 | ||||||||||
| Consolidated EBITDA | $ | 69,259 | $ | 94,022 | $ | (24,763) | (26.3) | % | ||
| Free cash flow | $ | (35,098) | $ | 48,913 | $ | (84,011) | (171.8) | % | ||
| 1 Reconciliation of these non-GAAP financial measures are provided below the financial tables. | ||||||||||
| Continuing Operations | Twelve Months Ended | |||||||||
| (in thousands, except per share data) | December 31, 2024 | December 31, 2023 | Change | Percent Change | ||||||
| Operating revenue | $ | 2,474,262 | $ | 1,370,735 | $ | 1,103,527 | 80.5 | % | ||
| Income from operations | $ | (1,062,936) | $ | 88,210 | $ | (1,151,146) | (1,305.0) | % | ||
| Operating margin | (43.0) | % | 6.4 | % | (4,940) bps | |||||
| Net income | $ | (1,124,841) | $ | 42,803 | $ | (1,167,644) | (2,727.9) | % | ||
| Net income per diluted share | $ | (29.43) | $ | 1.64 | $ | (31.07) | (1,894.5) | % | ||
| Cash provided by operating activities | $ | (76,262) | $ | 199,212 | $ | (275,474) | (138.3) | % | ||
| Non-GAAP Financial Measures: 1 | ||||||||||
| Consolidated EBITDA | $ | 307,711 | $ | 402,100 | $ | (94,389) | (23.5) | % | ||
| Free cash flow | $ | (108,185) | $ | 172,228 | $ | (280,413) | (162.8) | % | ||
| 1 Reconciliation of these non-GAAP financial measures are provided below the financial tables. |
Review of Financial Results
Forward Air will hold a conference call to discuss fourth quarter and full year 2024 results on Wednesday, February 26, 2025 at 4:30 p.m. ET. The Company's conference call will be available online on the Investor Relations portion of the Company's website at ir.forwardaircorp.com or by dialing (800) 445-7795, Access Code: FWRDQ424.
A replay of the conference call will be available on the Investor Relations portion of the Company’s website at ir.forwardaircorp.com, which we use as a primary mechanism to communicate with our investors. Investors are urged to monitor the Investor Relations portion of the Company’s website to easily find or navigate to current and pertinent information about us.
About Forward Air Corporation
Forward Air is a leading asset-light provider of transportation services across the United States, Canada and Mexico. We provide expedited less-than-truckload services, including local pick-up and delivery, shipment consolidation/deconsolidation, warehousing, and customs brokerage by utilizing a comprehensive national network of terminals. In addition, we offer truckload brokerage services, including dedicated fleet services, and intermodal, first- and last-mile, high-value drayage services, both to and from seaports and railheads, dedicated contract and Container Freight Station warehouse and handling services. Forward also operates a full portfolio of multimodal solutions, both domestically and internationally, via Omni Logistics. Omni Logistics is a global provider of air, ocean and ground services for mission-critical freight. We are more than a transportation company. Forward is a single resource for your shipping needs. For more information, visit our website at www.forwardaircorp.com.
| Forward Air Corporation | ||||||||
|---|---|---|---|---|---|---|---|---|
| Condensed Consolidated Statements of Comprehensive Income | ||||||||
| (Unaudited, in thousands, except per share data) | ||||||||
| Three Months Ended | Twelve Months Ended | |||||||
| December 31,<br>2024 | December 31,<br>2023 | December 31,<br>2024 | December 31,<br>2023 | |||||
| Operating revenue: | ||||||||
| Expedited Freight | $ | 265,879 | $ | 279,070 | $ | 1,115,163 | $ | 1,096,958 |
| Omni | 325,609 | — | 1,196,841 | — | ||||
| Intermodal | 59,829 | 59,440 | 232,832 | 274,043 | ||||
| Corporate | 164 | — | 164 | — | ||||
| Eliminations and other operations | (18,635) | (82) | (70,738) | (266) | ||||
| Operating revenue | 632,846 | 338,428 | 2,474,262 | 1,370,735 | ||||
| Operating expenses: | ||||||||
| Purchased transportation | 319,498 | 150,351 | 1,250,570 | 586,195 | ||||
| Salaries, wages, and employee benefits | 130,024 | 71,583 | 536,406 | 287,566 | ||||
| Operating leases | 48,326 | 20,908 | 182,197 | 87,413 | ||||
| Depreciation and amortization | 37,657 | 17,579 | 143,978 | 57,405 | ||||
| Insurance and claims | 19,721 | 11,145 | 64,682 | 50,133 | ||||
| Fuel expense | 5,500 | 5,271 | 21,460 | 22,004 | ||||
| Other operating expenses | 75,333 | 58,591 | 309,508 | 191,809 | ||||
| Impairment of goodwill | (79,068) | — | 1,028,397 | — | ||||
| Total operating expenses | 556,991 | 335,428 | 3,537,198 | 1,282,525 | ||||
| Income (loss) from continuing operations | ||||||||
| Expedited Freight | 7,238 | 26,745 | 67,951 | 116,040 | ||||
| Omni | 88,520 | — | (1,044,803) | — | ||||
| Intermodal | 5,931 | 5,068 | 18,925 | 25,327 | ||||
| Other operations | (25,834) | (28,813) | (105,009) | (53,157) | ||||
| Income (loss) from continuing operations | 75,855 | 3,000 | (1,062,936) | 88,210 | ||||
| Other expense: | ||||||||
| Interest expense, net | (48,427) | (23,976) | (189,215) | (31,571) | ||||
| Foreign exchange gain | 3,005 | — | 1,093 | — | ||||
| Other income (expense), net | 1,188 | — | 1,226 | — | ||||
| Total other expense | (44,234) | (23,976) | (186,896) | (31,571) | ||||
| Income (loss) from continuing operations before income taxes | 31,621 | (20,976) | (1,249,832) | 56,639 | ||||
| Income tax expense (benefit) | 67,000 | (6,255) | (124,990) | 13,836 | ||||
| Net income (loss) from continuing operations | (35,378) | (14,721) | (1,124,841) | 42,803 | ||||
| Income (loss) from discontinued operation, net of tax | (374) | 116,465 | (6,387) | 124,548 | ||||
| Net (loss) income | $ | (35,752) | $ | 101,744 | $ | (1,131,228) | $ | 167,351 |
| Net (loss) attributable to noncontrolling interest | $ | 664 | $ | — | $ | (314,259) | $ | — |
| Net (loss) income attributable to Forward Air | $ | (36,416) | $ | 101,744 | $ | (816,969) | $ | 167,351 |
| Net income per share: | ||||||||
| Basic net (loss) income per share: | ||||||||
| Continuing operations | $ | (1.23) | $ | (0.58) | $ | (29.43) | $ | 1.64 |
| Discontinued operation | (0.01) | 4.51 | (0.23) | 4.78 | ||||
| Net income per basic share1 | $ | (1.24) | $ | 3.94 | $ | (29.66) | $ | 6.42 |
| Diluted net (loss) income per share: | ||||||||
| Continuing operations | $ | (1.23) | $ | (0.58) | $ | (29.43) | $ | 1.64 |
| Discontinued operation | (0.01) | 4.51 | (0.23) | 4.77 | ||||
| Net income per diluted share1 | $ | (1.24) | $ | 3.93 | $ | (29.66) | $ | 6.40 |
| Dividends per share: | $ | — | $ | 0.24 | $ | — | $ | 0.96 |
1 Rounding may impact summation of amounts.
| Expedited Freight Segment Information | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| December 31, 2024 | Percent of Revenue | December 31, 2023 | Percent of Revenue | Change | Percent Change | |||||||
| Operating revenue: | ||||||||||||
| Network 1 | $ | 199,022 | 74.8 | % | $ | 217,279 | 77.9 | % | $ | (18,257) | (8.4) | % |
| Truckload | 45,087 | 17.0 | 38,538 | 13.8 | 6,549 | 17.0 | ||||||
| Other | 21,770 | 8.2 | 23,253 | 8.3 | (1,483) | (6.4) | ||||||
| Total operating revenue | 265,879 | 100.0 | 279,070 | 100.0 | (13,191) | (4.7) | ||||||
| Operating expenses: | ||||||||||||
| Purchased transportation | 136,151 | 51.2 | 132,359 | 47.4 | 3,792 | 2.9 | ||||||
| Salaries, wages and employee benefits | 56,587 | 21.3 | 56,291 | 20.2 | 296 | 0.5 | ||||||
| Operating leases | 18,130 | 6.8 | 15,396 | 5.5 | 2,734 | 17.8 | ||||||
| Depreciation and amortization | 10,395 | 3.9 | 12,328 | 4.4 | (1,933) | (15.7) | ||||||
| Insurance and claims | 10,423 | 3.9 | 9,438 | 3.4 | 985 | 10.4 | ||||||
| Fuel expense | 2,605 | 1.0 | 2,906 | 1.0 | (301) | (10.4) | ||||||
| Other operating expenses | 24,350 | 9.2 | 23,607 | 8.5 | 743 | 3.1 | ||||||
| Total operating expenses | 258,641 | 97.3 | 252,325 | 90.4 | 6,316 | 2.5 | ||||||
| Income from operations | $ | 7,238 | 2.7 | % | $ | 26,745 | 9.6 | % | $ | (19,507) | (72.9) | % |
| 1 Network revenue is comprised of all revenue, including linehaul, pickup and/or delivery, and fuel surcharge revenue, excluding accessorial and Truckload revenue. | ||||||||||||
| Expedited Freight Operating Statistics | ||||||||||||
| --- | --- | --- | --- | --- | --- | --- | ||||||
| Three Months Ended | ||||||||||||
| December 31, 2024 | December 31, 2023 | Percent Change | ||||||||||
| Business days | 64 | 63 | 1.6 | % | ||||||||
| Tonnage 1,2 | ||||||||||||
| Total pounds | 670,168 | 689,621 | (2.8) | |||||||||
| Pounds per day | 10,471 | 10,946 | (4.3) | |||||||||
| Shipments 1,2 | ||||||||||||
| Total shipments | 783 | 846 | (7.4) | |||||||||
| Shipments per day | 12.2 | 13.4 | (9.0) | |||||||||
| Weight per shipment | 856 | 815 | 5.0 | |||||||||
| Revenue per hundredweight 3 | $ | 29.70 | $ | 31.52 | (5.8) | |||||||
| Revenue per hundredweight, ex fuel 3 | $ | 23.74 | $ | 23.99 | (1.0) | |||||||
| Revenue per shipment 3 | $ | 254.30 | $ | 256.90 | (1.0) | |||||||
| Revenue per shipment, ex fuel 3 | $ | 203.26 | $ | 195.52 | 4.0 | |||||||
| 1 In thousands. | ||||||||||||
| 2 Excludes accessorial and Truckload products. | ||||||||||||
| 3 Includes intercompany revenue between the Network and Truckload revenue streams. | ||||||||||||
| Omni Logistics Segment Information | ||||||||||||
| --- | --- | --- | --- | --- | ||||||||
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| December 31,<br>2024 | Percent of Revenue | |||||||||||
| Operating revenue | $ | 325,609 | 100.0 | % | ||||||||
| Operating expenses: | ||||||||||||
| Purchased transportation | 183,084 | 56.2 | ||||||||||
| Salaries, wages and employee benefits | 54,056 | 16.6 | ||||||||||
| Operating leases | 23,036 | 7.1 | ||||||||||
| Depreciation and amortization | 22,605 | 6.9 | ||||||||||
| Insurance and claims | 3,911 | 1.2 | ||||||||||
| Fuel expense | 863 | 0.3 | ||||||||||
| Other operating expenses | 28,602 | 8.8 | ||||||||||
| Impairment of goodwill | (79,068) | (24.3) | ||||||||||
| Total operating expenses | 237,089 | 72.8 | ||||||||||
| Income from operations | $ | 88,520 | 27.2 | % | ||||||||
| Intermodal Segment Information | ||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| December 31, 2024 | Percent of Revenue | December 31, 2023 | Percent of Revenue | Change | Percent Change | |||||||
| Operating revenue | $ | 59,829 | 100.0 | % | $ | 59,440 | 100.0 | % | $ | 389 | 0.7 | % |
| Operating expenses: | ||||||||||||
| Purchased transportation | 18,898 | 31.6 | 18,073 | 30.4 | 825 | 4.6 | ||||||
| Salaries, wages and employee benefits | 14,227 | 23.8 | 15,243 | 25.6 | (1,016) | (6.7) | ||||||
| Operating leases | 6,463 | 10.8 | 5,512 | 9.3 | 951 | 17.3 | ||||||
| Depreciation and amortization | 4,519 | 7.6 | 5,251 | 8.8 | (732) | (13.9) | ||||||
| Insurance and claims | 2,498 | 4.2 | 2,398 | 4.0 | 100 | 4.2 | ||||||
| Fuel expense | 2,032 | 3.4 | 2,365 | 4.0 | (333) | (14.1) | ||||||
| Other operating expenses | 5,261 | 8.8 | 5,530 | 9.3 | (269) | (4.9) | ||||||
| Total operating expenses | 53,898 | 90.1 | 54,372 | 91.5 | (474) | (0.9) | ||||||
| Income from operations | $ | 5,931 | 9.9 | % | $ | 5,068 | 8.5 | % | $ | 863 | 17.0 | % |
| Intermodal Operating Statistics | ||||||||||||
| --- | --- | --- | --- | --- | --- | --- | ||||||
| Three Months Ended | ||||||||||||
| December 31, 2024 | December 31, 2023 | Percent Change | ||||||||||
| Drayage shipments | 63,920 | 65,776 | (2.8) | % | ||||||||
| Drayage revenue per shipment | $ | 847 | $ | 821 | 3.2 | % | ||||||
| Forward Air Corporation | ||||||||||||
| --- | --- | --- | --- | --- | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||||||
| (In thousands) (Unaudited) | ||||||||||||
| December 31, 2024 | December 31, 2023 | |||||||||||
| Assets | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | $ | 104,903 | $ | 121,969 | ||||||||
| Restricted cash equivalents | 363 | 39,604 | ||||||||||
| Accounts receivable, less allowance of $2,633 in 2024 and $2,206 in 2023 | 310,185 | 153,267 | ||||||||||
| Other receivables | 205 | 5,408 | ||||||||||
| Prepaid expenses | 29,053 | 25,682 | ||||||||||
| Other current assets | 15,685 | 1,098 | ||||||||||
| Total current assets | 460,394 | 347,028 | ||||||||||
| Noncurrent restricted cash equivalents | — | 1,790,500 | ||||||||||
| Property and equipment, net of accumulated depreciation and amortization of $292,855 in 2024 and $250,185 in 2023 | 326,188 | 258,095 | ||||||||||
| Operating lease right-of-use assets | 410,084 | 111,552 | ||||||||||
| Goodwill | 564,948 | 278,706 | ||||||||||
| Other acquired intangibles, net of accumulated amortization of $144,845 in 2024 and $127,032 in 2023 | 999,216 | 134,789 | ||||||||||
| Other assets | 71,940 | 58,863 | ||||||||||
| Total assets | $ | 2,832,770 | $ | 2,979,533 | ||||||||
| Liabilities and Shareholders’ Equity | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable | $ | 96,059 | $ | 45,430 | ||||||||
| Accrued expenses | 121,836 | 62,948 | ||||||||||
| Other current liabilities | 43,147 | 71,727 | ||||||||||
| Current portion of debt and finance lease obligations | 16,930 | 12,645 | ||||||||||
| Current portion of operating lease liabilities | 96,440 | 44,344 | ||||||||||
| Total current liabilities | 374,412 | 237,094 | ||||||||||
| Finance lease obligations, less current portion | 30,858 | 26,736 | ||||||||||
| Long-term debt, less current portion and debt issuance costs | 1,675,930 | — | ||||||||||
| Long-term debt held in escrow | — | 1,790,500 | ||||||||||
| Liability from tax receivable agreement | 13,295 | — | ||||||||||
| Operating lease liabilities, less current portion | 325,640 | 71,598 | ||||||||||
| Other long-term liabilities | 48,835 | 47,144 | ||||||||||
| Deferred income taxes | 38,169 | 42,200 | ||||||||||
| Shareholders’ equity: | ||||||||||||
| Preferred stock, $0.01 par value: Authorized shares - 5,000,000; no shares issued or outstanding in 2024 and 2023 | — | — | ||||||||||
| Preferred stock, Class B, $0.01 par value: Authorized shares - 15,000; issued and outstanding shares - 10,096 in 2024 and none in 2023 | — | — | ||||||||||
| Common stock, $0.01 par value: Authorized shares - 50,000,000; issued and outstanding shares - 29,761,197 in 2024 and 25,670,663 in 2023 | 298 | 257 | ||||||||||
| Additional paid-in capital | 582,153 | 283,684 | ||||||||||
| Retained (deficit) earnings | (338,228) | 480,320 | ||||||||||
| Accumulated other comprehensive loss | (2,732) | — | ||||||||||
| Total Forward Air shareholders equity | 241,491 | 764,261 | ||||||||||
| Noncontrolling interest | 84,140 | — | ||||||||||
| Total shareholders’ equity | 325,631 | 764,261 | ||||||||||
| Total liabilities and shareholders’ equity | $ | 2,832,770 | $ | 2,979,533 | ||||||||
| Forward Air Corporation | ||||||||||||
| --- | --- | --- | --- | --- | ||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||||
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| December 31, 2024 | December 31, 2023 | |||||||||||
| Operating activities: | ||||||||||||
| Net (loss) income from continuing operations | $ | (35,378) | $ | (14,721) | ||||||||
| Adjustments to reconcile net income of continuing operations to net cash provided by operating activities of continuing operations: | ||||||||||||
| Depreciation and amortization | 37,657 | 17,579 | ||||||||||
| Impairment of goodwill | (79,068) | — | ||||||||||
| Share-based compensation expense | 2,100 | 2,938 | ||||||||||
| Provision for revenue adjustments | 874 | 1,065 | ||||||||||
| Deferred income tax expense (benefit) | 108,276 | (11,092) | ||||||||||
| Other | 3,014 | (135) | ||||||||||
| Changes in operating assets and liabilities, net of effects from the purchase of acquired companies: | ||||||||||||
| Accounts receivable | 36,050 | 9,588 | ||||||||||
| Other receivables | 2,034 | (5,408) | ||||||||||
| Other current and noncurrent assets | 2,004 | 27,061 | ||||||||||
| Accounts payable and accrued expenses | (108,055) | 30,217 | ||||||||||
| Net cash provided by operating activities of continuing operations | (30,492) | 57,092 | ||||||||||
| Investing activities: | ||||||||||||
| Proceeds from sale of property and equipment | 2,644 | 466 | ||||||||||
| Purchases of property and equipment | (7,250) | (8,645) | ||||||||||
| Purchase of businesses, net of cash acquired | 623 | — | ||||||||||
| Other | (125) | — | ||||||||||
| Net cash used in investing activities of continuing operations | (4,108) | (8,179) | ||||||||||
| Financing activities: | ||||||||||||
| Repayments of finance lease obligations | (3,086) | (2,660) | ||||||||||
| Proceeds from credit facility | 75,000 | 25,000 | ||||||||||
| Repayments on credit facility | (75,000) | (147,375) | ||||||||||
| Proceeds from long-term debt held in escrow | — | 1,790,500 | ||||||||||
| Payments of dividends to shareholders | — | (6,197) | ||||||||||
| Proceeds from common stock issued under employee stock purchase plan | 398 | 379 | ||||||||||
| Payment of minimum tax withholdings on share-based awards | — | (25) | ||||||||||
| Contributions from subsidiary held for sale | — | 224,695 | ||||||||||
| Net cash provided by (used in) financing activities of continuing operations | (2,688) | 1,884,317 | ||||||||||
| Effect of exchange rate changes on cash | 874 | — | ||||||||||
| Net increase (decrease) in cash of continuing operations | (36,414) | 1,933,230 | ||||||||||
| Cash from discontinued operation: | ||||||||||||
| Net cash used in operating activities of discontinued operations | (374) | (35,135) | ||||||||||
| Net cash provided by investing activities of discontinued operations | — | 259,863 | ||||||||||
| Net cash used in financing activities of discontinued operations | — | (224,728) | ||||||||||
| Net (decrease) increase in cash, cash equivalents | (36,788) | 1,933,230 | ||||||||||
| Cash, cash equivalents, and restricted cash equivalents at beginning of period of continuing operations | 138,156 | 18,843 | ||||||||||
| Net (decrease) increase in cash, cash equivalents, and restricted cash equivalents | (32,890) | 1,933,230 | ||||||||||
| Cash, cash equivalents, and restricted cash equivalents at end of period of continuing operations | $ | 105,266 | $ | 1,952,073 | ||||||||
| Forward Air Corporation | ||||||||||||
| --- | --- | --- | --- | --- | ||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||||
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Year Ended | ||||||||||||
| December 31, 2024 | December 31, 2023 | |||||||||||
| Operating activities: | ||||||||||||
| Net income (loss) from continuing operations | $ | (1,124,841) | $ | 42,803 | ||||||||
| Adjustments to reconcile net income (loss) of continuing operations to net cash provided by operating activities of continuing operations: | ||||||||||||
| Depreciation and amortization | 143,978 | 57,405 | ||||||||||
| Impairment of goodwill | 1,028,397 | — | ||||||||||
| Share-based compensation expense | 10,188 | 11,495 | ||||||||||
| Provision for revenue adjustments | 3,635 | 5,091 | ||||||||||
| Deferred income tax expense (benefit) | (88,880) | (8,893) | ||||||||||
| Other | 7,310 | (1,180) | ||||||||||
| Changes in operating assets and liabilities, net of effects from the purchase of acquired companies: | ||||||||||||
| Accounts receivable | 2,000 | 30,555 | ||||||||||
| Other receivables | 8,193 | (5,408) | ||||||||||
| Other current and noncurrent assets | (16,211) | 30,683 | ||||||||||
| Accounts payable and accrued expenses | (50,031) | 36,661 | ||||||||||
| Net cash (used in) provided by operating activities of continuing operations | (76,262) | 199,212 | ||||||||||
| Investing activities: | ||||||||||||
| Proceeds from sale of property and equipment | 5,137 | 3,741 | ||||||||||
| Purchases of property and equipment | (37,060) | (30,725) | ||||||||||
| Purchase of businesses, net of cash acquired | (1,564,619) | (56,703) | ||||||||||
| Other | (444) | — | ||||||||||
| Net cash used in investing activities of continuing operations | (1,596,986) | (83,687) | ||||||||||
| Financing activities: | ||||||||||||
| Repayments of finance lease obligations | (18,425) | (9,500) | ||||||||||
| Proceeds from credit facility | 75,000 | 70,000 | ||||||||||
| Payments on credit facility | (155,000) | (178,500) | ||||||||||
| Proceeds from long-term debt held in escrow | — | 1,790,500 | ||||||||||
| Payment of debt issuance costs | (60,591) | — | ||||||||||
| Payment of earn-out liability | (12,247) | — | ||||||||||
| Payments of dividends to shareholders | — | (24,995) | ||||||||||
| Repurchases and retirement of common stock | — | (93,811) | ||||||||||
| Proceeds from common stock issued under employee stock purchase plan | 753 | 800 | ||||||||||
| Payment of minimum tax withholdings on share-based awards | (1,572) | (4,340) | ||||||||||
| Contributions from subsidiary held for sale | — | 240,572 | ||||||||||
| Net cash provided by (used in) financing activities of continuing operations | (172,082) | 1,790,726 | ||||||||||
| Effect of exchange rate changes on cash | 1,012 | — | ||||||||||
| Net (decrease) increase in cash, cash equivalents and restricted cash equivalents from continuing operations | (1,844,318) | 1,906,251 | ||||||||||
| Cash from discontinued operation: | ||||||||||||
| Net cash used in operating activities of discontinued operations | (6,387) | (17,824) | ||||||||||
| Net cash provided by investing activities of discontinued operation | — | 258,525 | ||||||||||
| Net cash used in financing activities of discontinued operation | — | (240,701) | ||||||||||
| Net (decrease) increase in cash and cash equivalents | (1,850,705) | 1,906,251 | ||||||||||
| Cash, cash equivalents, and restricted cash equivalents at beginning of period of continuing operations | 1,952,073 | 45,822 | ||||||||||
| Net (decrease) increase in cash, cash equivalents, and restricted cash equivalents | (1,846,807) | 1,906,251 | ||||||||||
| Cash, cash equivalents, and restricted cash equivalents at end of period of continuing operations | $ | 105,266 | $ | 1,952,073 |
Forward Air Corporation Reconciliation of Non-GAAP Financial Measures
In this press release, the Company uses non-GAAP financial measures that are derived on the basis of methodologies other than in accordance with GAAP. The Company believes that meaningful analysis of its financial performance requires an understanding of the factors underlying that performance, including an understanding of items that are non-operational. Management uses these non-GAAP financial measures in making financial, operating, compensation and planning decisions as well as evaluating the Company’s performance.
For the three and twelve months ended December 31, 2024 and 2023, this press release contains the following non-GAAP financial measures: earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted EBITDA, free cash flow, adjusted income from continuing operations, adjusted net income, and adjusted net income per diluted share. All non-GAAP financial measures are presented on a continuing operations basis.
The Company believes that EBITDA improves comparability from period to period by removing the impact of its capital structure (interest and financing expenses), asset base (depreciation and amortization) and tax impacts. The Company believes that free cash flow is an important measure of its ability to repay maturing debt or fund other uses of capital that it believes will enhance shareholder value. The Company believes providing adjusted EBITDA, adjusted income from operations, adjusted net income and adjusted net income per diluted share allows investors to compare Company performance consistently over various periods without regard to the impact of unusual, nonrecurring or nonoperational items.
Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s financial results prepared in accordance with GAAP. Non-GAAP financial information does not represent a comprehensive basis of accounting. As required by the Securities and Exchange Act of 1933 and the rules and regulations promulgated thereunder, the Company has included, for the periods indicated, a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure.
The following is a reconciliation of net income to adjusted EBITDA for the three and twelve months ended December 31, 2024 and 2023 (in thousands):
| Three Months Ended | Year Ended | |||||||
|---|---|---|---|---|---|---|---|---|
| December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||
| Income (loss) from continuing operations | $ | (35,378) | $ | (14,721) | $ | (1,124,841) | $ | 42,803 |
| Interest expense | 48,427 | 23,976 | 189,215 | 31,571 | ||||
| Income tax (benefit) expense | 67,000 | (6,255) | (124,990) | 13,836 | ||||
| Depreciation and amortization | 37,657 | 17,579 | 143,978 | 57,405 | ||||
| Reported EBITDA | 117,706 | 20,579 | (916,638) | 145,615 | ||||
| Impairment of goodwill | (79,068) | — | 1,028,397 | — | ||||
| Transaction and integration costs | 10,074 | 29,619 | 81,467 | 57,490 | ||||
| Severance costs | 1,923 | 198 | 16,337 | 517 | ||||
| Optimization project costs | 9,873 | — | 9,873 | — | ||||
| Pro forma synergies | 1,353 | — | 22,239 | — | ||||
| Pro forma savings | 5,048 | 5,649 | 32,622 | 21,524 | ||||
| Other | 2,351 | 1,485 | 33,414 | 7,085 | ||||
| Pro forma -Omni adjusted EBITDA | — | 36,492 | — | 169,869 | ||||
| Consolidated EBITDA | $ | 69,260 | $ | 94,022 | $ | 307,711 | $ | 402,100 |
The following is a reconciliation of net cash provided (used in) by operating activities to free cash flow for the three and twelve months ended December 31, 2024 and 2023 (in thousands):
| Three Months Ended | Twelve Months Ended | |||||||
|---|---|---|---|---|---|---|---|---|
| Continuing Operations | December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | ||||
| Net cash provided by (used in) operating activities | $ | (30,492) | $ | 57,092 | $ | (76,262) | $ | 199,212 |
| Proceeds from sale of property and equipment | 2,644 | 466 | 5,137 | 3,741 | ||||
| Purchases of property and equipment | (7,250) | (8,645) | (37,060) | (30,725) | ||||
| Free cash flow | $ | (35,098) | $ | 48,913 | $ | (108,185) | $ | 172,228 |
Note Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Forward-looking statements included in this press release relate to the Company’s expectations for long-term growth; ability to achieve and expand synergistic service offerings; expectations regarding the corrective pricing actions that the Company has taken as well as the impact that may have on the business and the Company’s expectations regarding the Company’s financial performance, including Consolidated EBITDA, and the impact it may have on the business and results of operations.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. The following is a list of factors, among others, that could cause actual results to differ materially from those contemplated by the forward-looking statements: economic factors such as recessions, inflation, higher interest rates and downturns in customer business cycles, the Company's ability to achieve the expected strategic, financial and other benefits of the acquisition of Omni Logistics, the risk that the businesses will not be integrated successfully or that integration may be more difficult, time-consuming or costly than expected, the risk that operating costs, customer loss, management and employee retention and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) as a result of the acquisition of Omni Logistics may be greater than expected, continued weakening of the freight environment, future debt and financing levels, our ability to deleverage, including, without limitation, through capital allocation or divestitures of non-core businesses, our ability to secure terminal facilities in desirable locations at reasonable rates, more limited liquidity than expected which limits our ability to make key investments, the creditworthiness of our customers and their ability to pay for services rendered, our inability to maintain our historical growth rate because of a decreased volume of freight or decreased average revenue per pound of freight moving through our network, the availability and compensation of qualified Leased Capacity Providers and freight handlers as well as contracted, third-party carriers needed to serve our customers’ transportation needs, our inability to manage our information systems and inability of our information systems to handle an increased volume of freight moving through our network, the occurrence of cybersecurity risks and events, market acceptance of our service offerings, claims for property damage, personal injuries or workers’ compensation, enforcement of and changes in governmental regulations, environmental, tax, insurance and accounting matters, the handling of hazardous materials, changes in fuel prices, loss of a major customer, increasing competition, and pricing pressure, our dependence on our senior management team and the potential effects of changes in employee status, seasonal trends, the occurrence of certain weather events, restrictions in our charter and bylaws and the risks described in our Annual Report on Form 10-K for the year ended December 31, 2023, and as may be identified in our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
We caution readers that any forward-looking statement made by us in this press release is based only on information currently available to us and they should not place undue reliance on these forward-looking statements, which reflect management's opinion as of the date on which it is made. We undertake no obligation to publicly update any forward- looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise unless required by law.
Contact:
Investors: Media:
Tony Carreño Justin Moss
investorrelations@forwardair.com (404) 362-8933
jmoss@forwardair.com
13
exhibit992q44q24earnings
Forward Air 4Q24 Earnings Presentation February 26, 2025
2 Statements & Disclaimers Forward Looking Statements This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Forward-looking statements included in this presentation relate to expectations regarding customer demand for services of Forward Air Corporation (“Forward”, “we” or “us”) as well as expectations regarding the freight market; ability to achieve and timing of capturing the intended benefits of the acquisition of Omni, including any revenue and cost synergies; expectations regarding lease overhang costs; ability to improve liquidity as well as the ability to delever and focus on debt repayment; expectations regarding the timing and impact of forecasted or anticipated savings and ability to reach the run rate; ability of Forward to identify opportunities to dispose of any non-core assets; expectations regarding Forward's ability to execute on its plan to integrate Omni Logistics in order to generate long-term value for shareholders; capital allocation strategies, including the result of any portfolio review and expectations regarding our Consolidated EBITDA for the 2024 calendar year. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. The following is a list of factors, among others, that could cause actual results to differ materially from those contemplated by the forward- looking statements: economic factors such as recessions, inflation, higher interest rates and downturns in customer business cycles, Forward's ability to achieve the expected strategic, financial and other benefits of the acquisition of Omni Logistics, including the realization of expected synergies and the achievement of deleveraging targets within the expected timeframes or at all, the risk that the businesses will not be integrated successfully or that integration may be more difficult, time-consuming or costly than expected, the risk that operating costs, customer loss, management and employee retention and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) as a result of the acquisition of Omni Logistics may be greater than expected, continued weakening of the freight environment, future debt and financing levels, our ability to deleverage, including, without limitation, through capital allocation or divestitures of non-core businesses, our ability to secure terminal facilities in desirable locations at reasonable rates, more limited liquidity than expected which limits our ability to make key investments, the creditworthiness of our customers and their ability to pay for services rendered, our inability to maintain our historical growth rate because of a decreased volume of freight or decreased average revenue per pound of freight moving through our network, the availability and compensation of qualified Leased Capacity Providers and freight handlers as well as contracted, third-party carriers needed to serve our customers’ transportation needs, our inability to manage our information systems and inability of our information systems to handle an increased volume of freight moving through our network, the occurrence of cybersecurity risks and events, market acceptance of our service offerings, claims for property damage, personal injuries or workers’ compensation, enforcement of and changes in governmental regulations, environmental, tax, insurance and accounting matters, the handling of hazardous materials, changes in fuel prices, loss of a major customer, increasing competition, and pricing pressure, our dependence on our senior management team and the potential effects of changes in employee status, seasonal trends, the occurrence of certain weather events, restrictions in our charter and bylaws and the risks described in our Annual Report on Form 10-K for the year ended December 31, 2023, and as may be identified in our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. We caution readers that any forward-looking statement made by us in this presentation is based only on information currently available to us and they should not place undue reliance on these forward-looking statements, which reflect management's opinion as of the date on which it is made. We undertake no obligation to publicly update any forward- looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise unless required by law. Non-GAAP Measures To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), we have included Consolidated EBITDA, Consolidated EBITDA Margin %, Net Leverage Ratio, Net Debt, Reported EBITDA, Reported EBITDA Margin %, Excluding Impairment of Goodwill, each a non-GAAP financial measure (each, a “Non-GAAP Measure”), in this presentation. The reconciliation of each Non-GAAP Measure to the most directly comparable financial measure calculated and presented in accordance with GAAP can be found in the Appendix to this presentation. Because each Non-GAAP Measure excludes certain items as described herein, it may not be indicative of the results that Forward expects to recognize for future periods. As a result, each Non-GAAP Measure should be considered in addition to, and not a substitute for, financial information prepared in accordance with GAAP. The Company is also providing Consolidated EBITDA and Net Leverage Ratio calculated in accordance with Forward’s credit agreement as we believe it provides investors with important information regarding our liquidity, financial condition and compliance with our obligations under our credit agreement.
AGENDA 01 02 4Q24 Highlights Integration Update03 04 Leverage and Liquidity Cash Flow 3 2024 Summary06 05 Full Year Results by Quarter 07 Appendix
4Q24 Overall Performance Steady Despite Prolonged Softness in Freight Cycle $76M O P E R AT I N G I N C O M E $69M 10.9% margin C O N S O L I D AT E D E B I T D A ( 1 ) $382M L I Q U I D I T Y ( 2 ) 5.5x ~$59M cushion LT M C O V E N A N T N E T L E V E R A G E ( 1 ) 1. Non-GAAP financial measure. Calculated pursuant to Senior Secured Loan Credit Agreement 2. Liquidity is defined as unrestricted cash plus availability to borrow under the Revolving Credit Facility $633M R E V E N U E 4
$55 $81 $77 $63 $89 $86 $69 1Q24 2Q24 3Q24 4Q24 Consolidated Results by Quarter Revenue Consolidated EBITDA $ (2) & Consolidated EBITDA Margin % (2) 5 (1) (1) 1. Pro-forma adjusted to reflect the Omni acquisition calculated in accordance with Article 11 of Regulation S-X. As a result, this number differs from reported amounts for 1Q24. For more information, please see our 8-K filed on June 10, 2024. 2. Non-GAAP financial measure. Calculated pursuant to Senior Secured Loan Credit Agreement 3. Reflects Consolidated EBITDA reported in previous quarters. Amounts were updated to reflect pro forma EBITDA add-backs of rent expense related to abandoned properties. $ in millions $621 $644 $656 $633 1Q24 2Q24 3Q24 4Q24 (3) (3) (3) 10.9%13.1%13.8%10.2%
Expedited Freight Segment Results by Quarter Segment Revenue 6 $273 $291 $285 $266 1Q24 2Q24 3Q24 4Q24 (1) 1. Segment totals do not include intercompany eliminations or corporate unallocated expenses. 2. Non-GAAP financial measure. Reconciliation provided in the Appendix on slide 17 Reported EBITDA7 (2) $ & Reported EBITDA Margin % (2) $30 $33 $29 $18 11.1% 11.2% 10.3% 6.6% 1Q24 2Q24 3Q24 4Q24 $ in millions
Omni Logistics Segment Results by Quarter Segment Revenue 7 (1) 1. Segment totals do not include intercompany eliminations or corporate unallocated expenses. 2. Non-GAAP financial measure. Reconciliation provided in the Appendix on slide 18 $225 $312 $335 $326 1Q24 2Q24 3Q24 4Q24 Reported EBITDA $ (2) & Reported EBITDA Margin %, Excluding Impairment of Goodwill (2) $(12) $20 $27 $32 -5.2% 6.4% 8.0% 9.8% 1Q24 2Q24 3Q24 4Q24 $ in millions
Intermodal Segment Results by Quarter Segment Revenue 8 (1) 1. Segment totals do not include intercompany eliminations or corporate unallocated expenses. 2. Non-GAAP financial measure. Reconciliation provided in the Appendix on slide 19 $8 $10 $9 $10 14.6% 16.9% 15.1% 17.5% 1Q24 2Q24 3Q24 4Q24 $56 $59 $57 $60 1Q24 2Q24 3Q24 4Q24 Reported EBITDA (2) $ & Reported EBITDA Margin % (2) $ in millions
Omni Integration on Track 1Q24 Close Transaction $8.3M Cumulative ▪ Maintained service and corporate processes without interruption ▪ Shut down Omni’s linehaul operations and absorbed volume into FWRD’s network ▪ Began to execute facilities consolidation plan 2Q24 Action Items $22.9M Cumulative ▪ Executed organizational streamlining with headcount redundancies ▪ Transitioned local cartage from 3rd-party vendors to FWRD where accretive ▪ Continued to execute facilities consolidations 3Q24 Realize Savings $40.8M Cumulative ▪ Completed air freight transportation management system consolidation; additional systems conversions to continue into 2025 ▪ Rolled out indirect spend initiatives using combined company’s improved buying power ▪ Continued to execute facilities consolidations End of 1Q25 and Beyond (Run-Rate) ~$80M Annualized 4Q24 Refinement and Improvement $59.4M Cumulative ▪ Completed harmonization of corporate policies and human capital management in US ▪ Continued IT system consolidations ▪ Continued to execute facilities consolidations Gross Synergies by Quarter in $M $8.3M $14.6M $17.9M $18.6M ▪ All synergy initiatives currently planned are expected to be actioned by the end of 1Q25 ▪ Costs to achieve depend on ability to secure lease terminations and sublets. Amount expected to decrease over time as lease overhang costs are mitigated from exited sites ▪ Continue to seek new synergy opportunities $20.0M (Anticipated) 9 The above does not include approximately $22M in other annualized cost reductions announced in December 2024 The above does not include approximately $23M in other annualized cost reductions announced in June 2024
$1,045 $725 2024 2025 2026 2027 2028 2029 2030 2031 Key Commentary First Lien Term Loan Senior Secured Notes ▪ No material maturities within the next 4 years ▪ Long period of time to effectuate integration and transformation and garner benefits of combination No Long-Term Debt Maturities Until December 2030 $ in millions Revolving Credit Facility (1) $300 1. Credit facility undrawn as of 12/31/24 other than $23 million letters of credit issued through the facility (Dec)(Jan) (Oct) 10 No Maturities Over Next 5 Years(1)
1Q24 2Q24 3Q24 4Q24 Term Loan B 1,045$ 1,045$ 1,045$ 1,045$ Senior Sec. Notes 725$ 725$ 725$ 725$ First Lien Debt (2) 1,770$ 1,770$ 1,770$ 1,770$ Net Cash (3) 136$ 68$ 122$ 86$ Net Debt 1,634$ 1,702$ 1,648$ 1,684$ Consolidated LTM EBITDA (1) 355$ 342$ 332$ 308$ Leverage Ratio 4.6x 5.0x 5.0x 5.5x $340 $340 $322 $277 $136 $68 $122 $86 $20 $20 $2 $16 $17 $15 $19 1Q24 2Q24 3Q24 4Q24 1. Calculated pursuant to Senior Secured Loan Credit Agreement 2. Includes Term Loan, Senior Secured Notes, and Revolving Credit Facility; excludes finance leases 3. Excludes foreign subsidiaries and restricted cash 4. Undrawn revolver balance 5. Totals may not foot due to rounding Deleveraging Remains a Key Priority for Management Through Potential Asset Sales and Operational Improvement Net Leverage(1) Liquidity Gross Cash: $105M Net Cash Revolving Credit Facility(4) Restricted Cash Deduction Foreign Subsidiary Deduction 11 Gross Cash: $138M(5) $445 $460(5) Net Leverage Ratio(1) Required Covenant Leverage Ratio(1) $512 Gross Cash: $172M $382 Gross Cash: $105M(5) 5.0x 5.2x 5.4x 5.5x 6.0x 6.0x 6.0x 6.75x 1Q24 2Q24 3Q24 4Q24 $ in millions $ in millions
Amended Credit Facility Agreement – December 2024 12 6.75x 6.75x 6.75x 6.75x 6.50x 6.25x 6.00x 5.75x 5.50x 5.50x5.50x 5.25x 5.00x 4.75x 4.50x 4.50x 4.50x 4.50x 4.50x 4.50x 4Q24 1Q25 2Q25 3Q25 4Q25 1Q26 2Q26 3Q26 4Q26 Thereafter New Previous First Lien Net Leverage Covenant(1) 1. Calculated pursuant to Senior Secured Loan Credit Agreement Provides increased flexibility to continue executing transformation Extended leverage step down by four quarters 2027 through maturity net leverage covenant increased by 1x Facility size reduced from $340M to $300M Additional details regarding the amendment can be found in the Company’s Form 8-K filed with the SEC on January 6, 2025 5.5x 4Q24 Net First Lien Leverage
$85 $81 $(22) $(27) $19 $137 $42 $(12) $(64) $2 $105 6/30 Unrestricted Cash Balance Operating Cash Flow Transaction & Integration Professional Fees Debt Service LC Release 9/30 Unrestricted Cash Balance Operating Cash Flow Transaction & Integration Professional Fees Debt Service LC Release 12/31 Unrestricted Cash Balance • Operating cash flow decreased $39M from 3Q24 to 4Q24, resulting from seasonal volume uplift • Professional fees primarily include: ‒ Transaction and integration professional fee spend in 2H24 largely driven by $28M catch up of accrued fees from prior two quarters • Debt service primarily includes: ‒ 3Q – Primarily $26M interest payment on Term Loan B ‒ 4Q – Primarily $35M interest payment on Senior Secured Notes, $26M interest payment on Term Loan B • $21M of LC cash collateral transferred to RCF and released to unrestricted cash 1 2 2 3 3 4 4 $52M $32M $20M positive cash flow over 2H24, with operating cash flow primarily used to service debt and pay legacy professional fees 3Q24 4Q24 Commentary 1 2 3 4 ($ in millions) 2H24 Cash Bridge 131. Operating Cash Flows represents the change in Unrestricted Cash less discrete items identified in this slide. (1) (1)
Completed transaction in 1Q24 Brought in new senior leadership beginning in April Continuing as an industry leader in on-time service and claims rates Transforming from separate legal entity driven organizations to a product, service and operations driven team with stronger back-office support, process and procedure Deleveraging remains focus via asset rationalization and improved performance Amended senior secured term loan credit agreement in December to provide additional financial flexibility Steady 4Q24 financial performance in the face of challenging market backdrop Ended 4Q24 in strong liquidity position Executed more than $100 million in annualized cost reduction synergies in 2024 2024 Summary 14
Appendix 15
- Non-GAAP financial measure. 2. Totals may not foot due to rounding Net Income to Consolidated EBITDA Reconciliation 16 $ in millions Consolidated EBITDA Reconciliation 1Q24 2Q24 3Q24 4Q24 TTM (12/31/2024) Net (loss) income from continuing operations ($89) ($966) ($34) ($35) ($1,125) Interest expense 41 47 53 48 189 Income tax (benefit) expense (18) (175) 1 67 (125) Depreciation and amortization 32 49 26 38 144 Reported EBITDA (1)(2) ($35) ($1,046) $46 $118 ($917) Impairment of goodwill -- 1,093 15 (79) 1,028 Transaction and integration costs 62 10 (1) 10 81 Severance costs 8 4 3 2 16 Optimization project costs -- -- -- 10 10 Pro forma synergies 11 6 5 1 22 Pro forma savings 11 10 6 5 33 Other 7 12 13 2 33 Consolidated EBITDA (1)(2) $63 $89 $86 $69 $308 Consolidated First Lien Indebtedness 1,770 Net Cash & Cash Equivalents (86) Net Debt $1,684 Consolidated First Lien Net Leverage Ratio 5.5x
1Q24 2Q24 3Q24 4Q24 FY 2024 Expedited Freight Operating revenue $273 $291 $285 $266 $1,115 Operating expenses Purchased transportation 128 143 140 136 546 Salaries, wages, and employee benefits 63 64 59 57 242 Operating leases 15 15 16 18 64 Depreciation and amortization 10 11 10 10 41 Insurance and claims 11 11 12 10 44 Fuel expense 3 2 2 3 10 Other operating expenses 25 24 26 24 100 Total operating expenses 254 269 265 259 1,047 Income (loss) from operations $19 $22 $19 $7 $68 (+) Depreciation and amortization 10 11 10 10 41 Reported EBITDA $30 $33 $29 $18 $109 Reported EBITDA Margin % 10.9% 11.2% 10.3% 6.6% 9.8% FY2024 Segment Performance – Expedited Freight 17 (1) 1. Segment totals do not include intercompany eliminations or corporate unallocated expenses. 2. Totals may not foot due to rounding $ in millions (2) (2) (2)
1Q24 2Q24 3Q24 4Q24 FY 2024 Omni Logistics Operating revenue $225 $312 $335 $326 $1,197 Operating expenses Purchased transportation 144 179 195 183 701 Salaries, wages, and employee benefits 49 58 55 54 216 Operating leases 19 27 28 23 97 Depreciation and amortization 17 33 11 23 84 Insurance and claims 2 3 3 4 12 Fuel expense 0 1 1 1 3 Other operating expenses 22 25 26 29 101 Impairment of goodwill - 1,093 15 (79) 1,029 Total operating expenses 253 1,418 333 237 2,242 Income (loss) from operations ($29) ($1,106) $1 $89 ($1,045) (+) Impairment of goodwill - 1,093 15 (79) 1,029 Adjusted income (loss) from operations ($29) ($13) $16 $9 ($16) (+) Depreciation and amortization 17 33 11 23 84 Reported EBITDA ($12) $20 $27 $32 $67 Reported EBITDA Margin % -5.2% 6.4% 8.0% 9.8% 5.6% FY2024 Segment Performance – Omni Logistics 18 1. Segment totals do not include intercompany eliminations or corporate unallocated expenses. 2. Totals may not foot due to rounding (1) $ in millions (2) (2) (2) (2)
1Q24 2Q24 3Q24 4Q24 FY 2024 Intermodal Operating revenue $56 $59 $57 $60 $233 Operating expenses Purchased transportation 17 19 18 19 74 Salaries, wages, and employee benefits 15 15 15 14 59 Operating leases 5 5 6 6 22 Depreciation and amortization 5 5 5 5 18 Insurance and claims 3 3 3 2 10 Fuel expense 2 2 2 2 9 Other operating expenses 6 6 6 5 23 Total operating expenses 53 54 53 54 214 Income (loss) from operations $4 $5 $4 $6 $19 (+) Depreciation and amortization 5 5 5 5 18 Reported EBITDA $8 $10 $9 $10 $37 Reported EBITDA Margin % 14.6% 16.9% 15.1% 17.5% 16.0% FY2024 Segment Performance – Intermodal 19 (1) 1. Segment totals do not include intercompany eliminations or corporate unallocated expenses. 2. Totals may not foot due to rounding $ in millions (2) (2) (2)
12.8 13.2 13.3 13.4 12.9 13.6 13.0 12.2 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 770 801 821 815 827 821 858 856 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 $198 $193 $199 $195 $200 $200 $207 $203 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Legacy Forward Air LTL Operating Metrics 20 Shipments per Day Weight per Shipment Revenue per Shipment Excluding Fuel In 000’s In pounds In $’s ▪ 4Q24 weight per shipment of 856 pounds with a 5.0% YoY increase ▪ 4Q24 revenue per shipment, ex fuel of $203 with a 4.0% YoY increase ▪ Driven by the corrective pricing actions focused on updated DOE costing methodology and contribution margin management. Negative and low contribution margin accounts are proactively being managed, rerated, or canceled. ▪ 4Q24 shipments per day of 12.2K with an 9.0% YoY decrease ▪ Driven by overall volume decrease in the market and efforts to improve productivity and profitability with greater revenue and profit per shipment vs overall shipment volume (2.3)%3.4%1.4%(4.8)%(7.0)%(12)% 4.5%2.5%7.4%11.3%7.7%5.4% 4.0%3.7%0.7%2.4%0.2%(2.0)%% YoY Change (9.0)% 5.0% 4.0%