Dive Brief:
- Knight-Swift Transportation Holdings remains interested in making LTL and TL acquisitions, despite anticipating a challenging first half of FY2023, CEO and President David Jackson said on an earnings call last week.
- The carrier’s free cash flow at the end of 2022 stood at $819 million, similar to its standing a year prior at $908 million — a year in which it acquired AAA Cooper in summer 2021 and RAC MME that fall.
- “We remain very interested and, I would say, very active in the M&A world,” Jackson said on the call.
Dive Insight:
While executives highlighted the company’s focus on M&A during its call with investors, Knight-Swift has not publicized any new deals over the past nine months to illustrate that priority.
“We're well positioned to act. Our number one priority clearly is LTL,” Jackson told investors last week. “Those take time and you have to have the right timing in some cases for that to work out.”
Knight-Swift’s number one M&A priority is LTL, Jackson said. The company has been seeking to build a nationwide LTL network, entering the LTL market in 2021 in a bid to diversify its services.
Jackson said the company is constantly evaluating market conditions to maximize use of the company's cash.
“Our balance sheet is strong and we're well positioned to invest in organic growth, pursue acquisitions, purchase more shares, increase dividends and/or pay down debt," he said.
While Knight-Swift has talked repeatedly over the past year about M&A, such deals could falter amid challenging market conditions. An FTR trucking index involving factors such as freight volumes, rates and financing showed declines among carriers throughout most of 2022.
