JACKSONVILLE, Fla. – Landstar System has reported its fourth-quarter revenue basic and diluted earnings per share (EPS) of $1.62 in the 2023 13-week fourth quarter on revenue of $1.204 billion.
Landstar reported an EPS of $2.60 on revenue of $1.675 billion in the 2022 14-week fourth quarter.
Overall for 2023, the company reported $5.31 billion in revenue, down 29% from 2022.
The company’s fiscal year ends each year on the last Saturday in December. As such, the company’s 2022 fourth quarter ended on Dec. 31 and included 14 weeks of operations, whereas the 2023 fourth quarter ended on Dec. 30 and included 13 weeks of operations. Company officials estimate the extra week in 2022 contributed revenue of approximately $65 million.
Gross profit in the 2023 fourth quarter was $124.6 million and variable contribution (defined as revenue less the cost of purchased transportation and commissions to agents) in the 2023 fourth quarter was $178.1 million. Gross profit in the 2022 fourth quarter was $180.0 million and variable contribution in the 2022 fourth quarter was $234.0 million. Reconciliations of gross profit to variable contribution and gross profit margin to variable contribution margin for the 2023 and 2022 fourth quarters and full fiscal years are provided in the company’s accompanying financial disclosures.
The 12-month return on average shareholders’ equity was 27%, and the return on invested capital, representing net income divided by the sum of average equity plus average debt, was 25%. The company is currently authorized to purchase up to 3 million shares of common stock under its previously announced share purchase programs.
Landstar announced that its Board of Directors has declared a quarterly dividend of $0.33 per share payable on March 8,to stockholders of record as of the close of business on Feb. 12. It is currently the intention of the Board to pay dividends on a quarterly basis going forward.
Truck transportation revenue hauled by independent business capacity owners (“BCOs”) and truck brokerage carriers in the 2023 fourth quarter was $1,085.1 million, or 90% of revenue, compared to $1,533.6 million, or 92% of revenue, in the 2022 fourth quarter.
Truckload transportation revenue hauled via van equipment in the 2023 fourth quarter was $618.6 million, compared to $869.8 million in the 2022 fourth quarter.
Truckload transportation revenue hauled via unsided/platform equipment in the 2023 fourth quarter was $339.9 million, compared to $423.4 million in the 2022 fourth quarter. Revenue from other truck transportation, which is largely related to power-only services, in the 2023 fourth quarter was $99.7 million, compared to $204.0 million in the 2022 fourth quarter.
Revenue hauled by rail, air and ocean cargo carriers was $88.6 million, or 7% of revenue, in the 2023 fourth quarter, compared to $115.1 million, or 7% of revenue, in the 2022 fourth quarter.
“As expected, the soft macro-freight environment experienced throughout 2023 continued through the 2023 fourth quarter. The soft macro-freight environment, along with the additional operating week in the 2022 fourth quarter, made for challenging 2023 fourth quarter to 2022 fourth quarter comparisons,” said Landstar President and Chief Executive Officer Jim Gattoni.
The continuation of soft demand, driven by continued weakness in the U.S. manufacturing sector and a weaker than typical peak season, plus the continuation of a loose truck capacity market drove Landstar’s truck revenue per load and volumes in the 2023 fourth quarter below prior-year levels, Gattoni noted.
“The number of loads hauled via truck declined 22% as compared to the 2022 fourth quarter, at the low end of the company’s guidance included as part of the company’s 2023 third-quarter earnings release on Oct. 25, 2023, while truck revenue per load declined 10% as compared to the 2022 fourth quarter, below the low end of the company’s previously issued guidance,” he said. “Landstar’s financial performance in 2023, coming off a back-to-back record-setting year in 2022 and 2021, was admirable, considering the very difficult freight transportation backdrop.”
The company’s performance during the downcycle in freight markets experienced in 2023 speaks to the strength and resiliency of the Landstar network and the power of our unique agent and capacity network, according to Gattoni.
“The company’s balance sheet continues to be very strong, with cash and short-term investments of approximately $541 million as of Dec. 30, 2023, he said.
“Cash flow from operations was $394 million during fiscal year 2023,” Gattoni said. “The company is well positioned to capitalize when freight market fundamentals improve. Typically, revenue in the first quarter is expected to be lower than the revenue of the immediately preceding fourth quarter. Through the first several weeks of January, the number of loads hauled via truck and truck revenue per load have each trended reasonably in-line with historical, pre-pandemic end of fourth quarter to the beginning of first quarter sequential patterns.”
Gattoni said he expects revenue per load on loads hauled via truck to be in a range of 8% to 10% below the 2023 first quarter and the number of loads hauled via truck to be in a range of 14% to 16% below the 2023 first quarter.
“As such, I anticipate revenue for the 2024 first quarter to be in a range of $1.10 billion to $1.15 billion,” he said. “Based on the range of revenue estimated for the 2024 first quarter, I would anticipate EPS to be in a range of $1.25 to $1.35. The anticipated range of EPS for the 2024 first quarter includes estimated insurance and claims costs of approximately 5.5% of BCO revenue. These costs were 5.7% of BCO revenue during fiscal year 2023. The anticipated range of EPS for the 2024 first quarter also reflects an estimated effective income tax rate of 24.5%.”
Born and raised in Little Rock, AR, Erica N. Guy decided to stay in her hometown to begin her professional career in journalism. Since obtaining her bachelor’s degree from UAPB, Erica has professionally written for several publications about several topics ranging from lifestyle, tech, culture, and entertainment, just to name a few. Continuing her love for her hometown, she joined our team in June 2023, where she is currently a staff writer. Her career goals include continuing storytelling through her writing by being the best professional writer she can be. In her spare time, Erica enjoys trying new foods, cozying up with a good book, spending time with family and friends, and establishing herself as a future businesswoman.
