What Forced Knight-Swift To Cut Q1, Q2 Earnings Outlook Below View?

(RTTNews) - Knight-Swift Transportation Holdings Inc. (KNX), a motor carrier holding company, announced on Wednesday that it has revised down its first and second quarter earnings guidance below analysts' estimates.

According to the company, the full truckload industry continues to be challenging and oversupplied with capacity.

Further, the company said, the weather disruption in January had a greater impact than initially estimated, as the subsequent recovery was not sufficient to offset the negative impact to volumes and operating costs for the quarter. "The early part of the bid season led to greater than expected pressure on freight rates as some shippers are still trying to push rates down further."

For the first-quarter, based on its preliminary analysis, the firm now expects adjusted earnings per share of $0.11 to $0.12 against the previously-announced outlook of $0.37 to $0.41 per share.

The new guidance includes loss of $0.08 per share for the third-party insurance business that ceased operation at the end of the quarter. Excluding this insurance loss, the expected adjusted earnings per share range would be $0.19 to $0.20 per share.

On average, 15 analysts, polled by Thomson Reuters expect the company to earn $0.29 per share, for the quarter. Analysts' estimates typically exclude special items.

For the second-quarter, Knight-Swift now projects earnings per share, excluding items, of $0.26 to $0.30, lower than the previously-announced guidance range of $0.53 to $0.57. This reflects more challenging market conditions, such as the bid season trends and less pronounced seasonality in the truckload market than originally projected.

Analysts, on average, expect the company to post earnings per share of $0.48, for the quarter.

KNX was trading down by 4 percent at $48.66 on the New York Stock Exchange.