0000912728false00009127282024-08-072024-08-07


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): August 7, 2024

FORWARD AIR CORPORATION
(Exact name of registrant as specified in its charter)
TN62-1120025
(State or other jurisdiction of incorporation)(I.R.S. Employer Identification No.)
1915 Snapps Ferry RoadBuilding NGreenevilleTN37745
(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 classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.01 par valueFWRDNASDAQ
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 August 7, 2024, Forward Air Corporation (the “Company”) issued a press release (the “Press Release”) announcing its financial results for the three months ended June 30, 2024. On August 7, 2024, the Company also posted an Earnings Presentation (the “Earnings Presentation”), dated August 7, 2024, 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
104Cover 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: August 7, 2024
 By: /s/ Jamie Pierson
   Jamie Pierson
Chief Financial Officer

 



 

 







forwardlogoa05a.jpg
NEWS RELEASE

FORWARD AIR CORPORATION REPORTS SECOND QUARTER 2024 RESULTS
Positive momentum despite softness in freight market

Continues to accelerate integration, synergy capture and cost elimination

GREENEVILLE, Tenn. – (BUSINESS WIRE) – August 7, 2024 – Forward Air Corporation (NASDAQ:FWRD) (the “Company”, “we”, “our”, or “us”) today reported financial results for the three months ended June 30, 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.

Shawn Stewart, Forward’s recently appointed Chief Executive Officer, said, “As a result of the Omni transaction, the combined company now has a unique platform to drive long-term growth through continued best in class domestic expedited and intermodal services and now global freight forwarding and contract logistics services. In our first full quarter as one company, we are beginning to see the power of the combination. We have recently closed several exciting sales wins, and operationally, we are laser-focused on capturing the previously announced synergies as well as other additional cost saving opportunities that were not previously identified. Our achievements in such a short period of time have only added to my confidence in our combined ability to build on the strengths of our legacy companies.”

Mr. Stewart continued, “I am thrilled to have Jamie Pierson on board as our Chief Financial Officer. Jamie has already made a significant impact at the company, especially to our finance organization's processes and reporting capabilities. I look forward to working alongside him as we chart a new course for the Company.”

Mr. Pierson said, “While we continue to face challenging market conditions, we experienced positive momentum as Consolidated EBITDA, a non-GAAP financial measure calculated pursuant to our credit agreement, increased from approximately $55 million in the first quarter of this year to $81 million in the second quarter. Our results demonstrate progress in our business, and we expect to see additional improvement as we continue to realize synergies associated with the transaction. This quarter, we realized approximately $14 million in cost synergy capture, in line with the original estimates and anticipate being at full run-rate savings earlier than previously anticipated. According to our revised integration plans, we believe that we will be operating at full run rate synergy levels by the end of the first quarter of 2025, and despite the noise of the integration and softness in the broader freight market, we believe that we will deliver somewhere between $310 to $325 million in Consolidated EBITDA for 2024.”

Mr. Stewart added, “Obviously, integrations of this size, magnitude and complexity do not progress in a linear fashion, and while the market at large remains uncertain, we believe in the power of the combined company and expect to demonstrate continued improvement in the quarters to come.”



Three Months Ended
(in thousands, except per share data)June 30, 2024June 30, 2023ChangePercent Change
Operating revenue$643,666 $333,622 $310,044 92.9 %
(Loss) income from operations $(1,095,755)$26,325 $(1,122,080)(4,262.4)%
Operating margin(170.2)%7.9 %(17,810) bps
Net (loss) income$(966,471)$17,127 $(983,598)(5,743.0)%
Net (loss) income per diluted share$(23.29)$0.65 $(23.94)(3,683.1)%
Cash (used in) provided by operating activities$(45,200)$56,615 $(101,815)(179.8)%
Non-GAAP Financial Measures: 1
Adjusted net income -consolidated EBITDA$81,325 $101,688 $(20,363)(20.0)%
Free cash flow$(59,069)$47,654 $(106,723)(224.0)%
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 second quarter 2024 results on Wednesday, August 7, 2024 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) 343-4136, Access Code: FWRDQ224.

A replay of the conference call will be available on the Investor Relations portion of the Company’s website at www.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.
2

Forward Air Corporation
Condensed Consolidated Statements of Comprehensive (Loss) Income
(Unaudited, in thousands, except per share data)
 Three Months EndedSix Months Ended
June 30, 2024June 30, 2023June 30, 2024June 30, 2023
Operating revenues:
Expedited Freight$291,282 $269,436 $564,577 $539,013 
Intermodal59,299 64,251 115,591 152,420 
Omni Logistics311,856 — 536,694 — 
Eliminations and other operations(18,771)(65)(31,383)(102)
Operating revenues643,666 333,622 1,185,479 691,331 
Operating expenses:   
Purchased transportation321,587 141,967 598,602 287,138 
Salaries, wages and employee benefits144,000 73,963 272,867 140,610 
Operating leases46,258 22,896 85,061 46,969 
Depreciation and amortization48,639 13,245 80,425 25,617 
Insurance and claims14,698 12,761 27,579 26,019 
Fuel expense5,859 5,202 11,105 10,888 
Other operating expenses65,666 37,263 178,613 80,569 
Impairment of goodwill1,092,714 — 1,092,714 — 
Total operating expenses1,739,421 307,297 2,346,966 617,810 
Income (loss) from continuing operations:
Expedited Freight21,946 27,063 41,444 56,748 
Intermodal5,317 4,312 8,903 15,515 
Omni Logistics(1,105,871)— (1,134,456)— 
Other Operations(17,147)(5,050)(77,378)1,258 
(Loss) income from continuing operations(1,095,755)26,325 (1,161,487)73,521 
Other expense:    
Interest expense, net(47,265)(2,585)(88,018)(4,940)
Foreign exchange gain1,567 — 899 — 
Other income, net40 — 49 — 
Total other expense(45,658)(2,585)(87,070)(4,940)
(Loss) income before income taxes(1,141,413)23,740 (1,248,557)68,581 
Income tax (benefit) expense(174,942)6,613 (193,292)17,550 
Net (loss) income from continuing operations(966,471)17,127 (1,055,265)51,031 
(Loss) income from discontinued operation, net of tax(4,876)2,824 (4,876)5,288 
Net (loss) income(971,347)19,951 $(1,060,141)$56,319 
Net (loss) attributable to noncontrolling interest(325,914)— (352,996)— 
Net (loss) income attributable to Forward Air$(645,433)$19,951 $(707,145)$56,319 
Net income per common share:  
Basic net (loss) income per share
Continuing operations$(23.29)$0.65 $(27.53)$1.94 
Discontinued operation(0.18)0.11 (0.18)0.20 
Basic $(23.47)$0.76 $(27.71)$2.14 
Diluted net (loss) income per share
Continuing operations$(23.29)$0.65 $(27.53)$1.93 
Discontinued operation(0.18)0.11 (0.18)0.20 
Diluted$(23.47)$0.76 $(27.71)$2.13 
Dividends per share:$— $0.24 $— $0.48 
Net (loss) income$(971,347)$19,951 $(1,060,141)$56,319 
Other comprehensive (loss) income:
Foreign currency translation adjustments(849)— (1,000)— 
Comprehensive (loss) income$(972,196)$19,951 $(1,059,141)$56,319 
3

Expedited Freight Segment Information
(In thousands)
(Unaudited)
Three Months Ended
 June 30, 2024Percent of RevenueJune 30, 2023Percent of RevenueChangePercent Change
Operating revenues:
Network 1
$223,334 76.7 %$205,762 76.4 %$17,572 8.5 %
Truckload44,678 15.3 40,432 15.0 4,246 10.5 
Other23,270 8.0 23,242 8.6 28 0.1 
Total operating revenues291,282 100.0 269,436 100.0 21,846 8.1 
Operating expenses:
Purchased transportation142,512 48.9 124,122 46.1 18,390 14.8 
Salaries, wages and employee benefits63,845 21.9 57,637 21.4 6,208 10.8 
Operating leases14,730 5.1 16,201 6.0 (1,471)(9.1)
Depreciation and amortization10,692 3.7 8,439 3.1 2,253 26.7 
Insurance and claims10,969 3.8 10,104 3.8 865 8.6 
Fuel expense2,434 0.8 2,511 0.9 (77)(3.1)
Other operating expenses24,154 8.3 23,359 8.7 795 3.4 
Total operating expenses269,336 92.5 242,373 90.0 26,963 11.1 
Income from operations$21,946 7.5 %$27,063 10.0 %$(5,117)(18.9)%
1 Network revenue is comprised of all revenue, including linehaul, pickup and/or delivery, and fuel surcharge revenue, excluding accessorial and Truckload revenue.

4

Expedited Freight Operating Statistics
Three Months Ended
June 30, 2024June 30, 2023Percent Change
Business days64 64 — %
Tonnage 1,2
    Total pounds713,919 673,878 5.9 
    Pounds per day11,155 10,529 5.9 
Shipments 1,2
    Total shipments870 842 1.4 
    Shipments per day13.6 13.2 1.4 
Weight per shipment821 801 2.5 
Revenue per hundredweight 3
$31.29 $30.79 1.6 
Revenue per hundredweight, ex fuel 3
$24.38 $24.08 1.2 
Revenue per shipment 3
$256.80 $246.59 4.1 
Revenue per shipment, ex fuel 3
$200.05 $192.85 3.7 
1 In thousands
2 Excludes accessorial and Truckload and products
3 Includes intercompany revenue between the Network and Truckload revenue streams

5

Intermodal Segment Information
(In thousands)
(Unaudited)
Three Months Ended
 June 30, 2024Percent of RevenueJune 30, 2023Percent of RevenueChangePercent Change
Operating revenue$59,299 100.0 %$64,251 100.0 %$(4,952)(7.7)%
Operating expenses:
Purchased transportation19,173 32.3 17,909 27.9 1,264 7.1 
Salaries, wages and employee benefits14,899 25.1 16,650 25.9 (1,751)(10.5)
Operating leases4,776 8.1 6,695 10.4 (1,919)(28.7)
Depreciation and amortization4,712 7.9 4,806 7.5 (94)(2.0)
Insurance and claims2,619 4.4 2,815 4.4 (196)(7.0)
Fuel expense2,243 3.8 2,692 4.2 (449)(16.7)
Other operating expenses5,560 9.4 8,372 13.0 (2,812)(33.6)
Total operating expenses53,982 91.0 59,939 93.3 (5,957)(9.9)
Income from operations$5,317 9.0 %$4,312 6.7 %$1,005 23.3 %

Intermodal Operating Statistics
Three Months Ended
June 30, 2024June 30, 2023Percent Change
Drayage shipments64,877 68,180 (4.8)%
Drayage revenue per shipment$826 $853 (3.2)%

6

Omni Logistics Segment Information
(In thousands)
(Unaudited)
Three Months Ended
 June 30, 2024Percent of Revenue
Operating revenue$311,856 100.0 %
Operating expenses:
Purchased transportation178,674 57.3 
Salaries, wages and employee benefits57,536 18.4 
Operating leases26,751 8.6 
Depreciation and amortization33,235 10.7 
Insurance and claims2,845 0.9 
Fuel expense1,182 0.4 
Other operating expenses24,790 7.9 
Impairment of goodwill1,092,714 350.4 
Total operating expenses1,417,727 454.6 
Loss from operations$(1,105,871)(354.6)%



7

Forward Air Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
 June 30, 2024December 31, 2023
Assets
Current assets: 
Cash and cash equivalents$84,886 $121,969 
Restricted cash and restricted cash equivalents19,769 39,604 
Accounts receivable, net368,927 153,267 
Other receivables1,476 5,408 
Prepaid expenses39,186 25,682 
Other current assets44,379 1,098 
Total current assets558,623 347,028 
Noncurrent restricted cash equivalents— 1,790,500 
Property and equipment607,961 508,280 
Less accumulated depreciation and amortization279,027 250,185 
Property and equipment, net328,934 258,095 
Operating lease right-of-use assets323,821 111,552 
Goodwill545,380 278,706 
Other acquired intangibles, net1,230,699 134,789 
Other assets79,859 58,863 
Total assets$3,067,316 $2,979,533 
Liabilities and Shareholders' Equity 
Current liabilities: 
Accounts payable$143,455 $45,430 
Accrued expenses117,431 62,948 
Other current liabilities53,064 71,727 
Current portion of debt and finance lease obligations16,875 12,645 
Current portion of operating lease liabilities89,188 44,344 
Total current liabilities420,013 237,094 
Finance lease obligations, less current portion34,957 26,736 
Long-term debt, less current portion1,677,315 — 
Long-term debt held in escrow— 1,790,500 
Operating lease liabilities, less current portion243,217 71,598 
Liabilities under tax receivable agreement13,270 — 
Other long-term liabilities43,126 47,144 
Deferred income taxes271,201 42,200 
Shareholders' equity:
Preferred stock— — 
Common stock277 257 
Additional paid-in capital512,638 283,684 
Retained earnings(228,151)480,320 
Accumulated other comprehensive loss(1,000)— 
Total Forward Air shareholders' equity283,764 764,261 
Noncontrolling interest80,453 — 
Total shareholders' equity364,217 764,261 
Total liabilities and shareholders' equity$3,067,316 $2,979,533 
8

Forward Air Corporation
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended
June 30, 2024June 30, 2023
Operating activities:
Net (loss) income from continuing operations$(966,471)$17,127 
Adjustments to reconcile net (loss) income of continuing operations to net cash (used in) provided by operating activities of continuing operations
Depreciation and amortization48,639 13,244 
Impairment of goodwill1,092,714 — 
Share-based compensation expense3,620 2,890 
Provision for revenue adjustments1,121 1,714 
Deferred income tax (benefit) expense(166,549)325 
Other2,300 (642)
Changes in operating assets and liabilities, net of effects from the purchase of acquired businesses:
Accounts receivable(21,770)22,293 
Other receivables164 — 
Other current and noncurrent assets(49,528)(300)
Accounts payable and accrued expenses10,560 (36)
Net cash (used in) provided by operating activities of continuing operations(45,200)56,615 
Investing activities:
Proceeds from sale of property and equipment557 1,356 
Purchases of property and equipment(14,426)(10,317)
Purchases of a business, net of cash acquired— (136)
Other(85)— 
Net cash used in investing activities of continuing operations(13,954)(9,097)
Financing activities:
Repayments of finance lease obligations(4,567)(1,837)
Payments on credit facility— (30,750)
Payments of dividends to shareholders— (6,255)
Repurchases and retirement of common stock— (25,009)
Proceeds from common stock issued under employee stock purchase plan369 421 
Payment of minimum tax withholdings on share-based awards(33)(4,292)
Contributions from subsidiary held for sale— 6,457 
Net cash used in financing activities of continuing operations(4,231)(61,265)
Effect of exchange rate changes on cash646 — 
Net decrease in cash, cash equivalents, restricted cash, and restricted cash equivalents from continuing operations(62,739)(13,747)
Cash from discontinued operation:
Net cash (used in) provided by operating activities of discontinued operation(4,876)6,958 
Net cash used in investing activities of discontinued operation— (469)
Net cash used in financing activities of discontinued operation— (6,489)
Net decrease in cash, cash equivalents, restricted cash and restricted cash equivalents(67,615)(13,747)
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period of continuing operations172,270 32,028 
Cash at beginning of period of discontinued operation— — 
Net decrease in cash, cash equivalents, restricted cash and restricted cash equivalents(67,615)(13,747)
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period of continuing operations$104,655 $18,281 
9

Forward Air Corporation
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended
June 30, 2024June 30, 2023
Operating activities:
Net (loss) income from operations$(1,055,265)$51,031 
Adjustments to reconcile net income of operations to net cash provided by operating activities of operations
Depreciation and amortization80,425 25,617 
Impairment of goodwill1,092,714 — 
Share-based compensation expense5,187 5,796 
Provision for revenue adjustments2,159 2,812 
Deferred income tax (benefit) expense(163,604)2,182 
   Other6,469 (1,733)
Changes in operating assets and liabilities, net of effects from the purchase of acquired businesses:
Accounts receivable(42,265)38,690 
Other receivables5,531 — 
Other current and noncurrent assets(56,637)10,609 
Accounts payable and accrued expenses28,362 (17,550)
Net cash provided by operating activities(96,924)117,454 
Investing activities:
Proceeds from sale of property and equipment1,406 3,171 
Purchases of property and equipment(19,396)(16,836)
Purchase of a business, net of cash acquired(1,565,242)(56,703)
Other(174)— 
Net cash used in investing activities(1,583,406)(70,368)
Financing activities:
Repayments of finance lease obligations(9,127)(3,923)
Proceeds from credit facility— 45,000 
Payments on credit facility(80,000)(30,750)
Payment of debt issuance costs(60,591)— 
Payment of earn-out liability(12,247)— 
Payments of dividends to shareholders— (12,600)
Repurchases and retirement of common stock— (79,792)
Proceeds from common stock issued under employee stock purchase plan369 421 
Payment of minimum tax withholdings on share-based awards(1,361)(4,292)
Contributions from (distributions to) subsidiary held for sale— 11,309 
Net cash used in financing activities(162,957)(74,627)
Effect of exchange rate changes on cash745 — 
Net (decrease) increase in cash and cash equivalents(1,842,542)(27,541)
Cash from discontinued operation:
Net cash used in operating activities of discontinued operation(4,876)12,112 
Net cash provided by (used in) investing activities of discontinued operation— (739)
Net cash (used in) provided by financing activities of discontinued operation— (11,373)
Net increase (decrease) in cash and cash equivalents(1,847,418)(27,541)
Cash and cash equivalents at beginning of period1,952,073 45,822 
Cash and cash equivalents at end of period$104,655 $18,281 
10

Forward Air Corporation Reconciliation of Non-GAAP Financial Measures

In this press release, the Company includes financial measures that are derived on the basis of methodologies other than in accordance with accounting principles generally accepted in the United States (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 months ended June 30, 2024 and 2023, this press release contains the following non-GAAP financial measures: earnings before interest, taxes, depreciation and amortization (“EBITDA”), and free cash flow.

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 is also providing Consolidated EBITDA calculated in accordance with our credit agreement as we believe it provides investors with important information regarding our financial condition and compliance with our obligations under our credit agreement.

Non-GAAP financial measures should be viewed in addition to, and not as an alternative to or substitute for, the Company’s financial results prepared in accordance with GAAP. The Company has included, for the periods indicated, a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure. Investors and other readers are encouraged to review the related U.S. GAAP financial measures and the reconciliations of the non-GAAP measures to their most directly comparable U.S. GAAP measures set forth below.

With respect to the 2024 Consolidated EBITDA guidance, please note that the Company is not providing a quantitative reconciliation of Consolidated EBITDA to Net Income because it is not available without unreasonable efforts. The Company does not currently have sufficient data to accurately estimate the variables and individual adjustments for such reconciliation, or to quantify the probable significance of these items. The adjustments required for any such reconciliation of the Company’s forward-looking non-GAAP financial measures cannot be accurately forecast by the Company, and therefore the reconciliation has been omitted.





















11

The following is a reconciliation of net income to Consolidated EBITDA for the three and six months ended June 30, 2024 and 2023 (in thousands):

Three Months EndedSix Months Ended
June 30, 2024June 30, 2023June 30, 2024June 30, 2023
Net (loss) income$(966,471)$17,127 $(1,055,265)$51,031 
Interest expense47,265 2,585 88,018 4,940 
Income tax (benefit) expense(174,942)6,613 (193,292)17,550 
Depreciation and amortization48,639 13,245 80,425 25,617 
Reported EBITDA(1,045,509)39,570 (1,080,114)99,138 
Impairment of goodwill1,092,714 — 1,092,714 — 
Transaction and integration costs10,018 5,500 71,942 5,500 
Severance costs4,029 113 11,585 161 
Cost synergies5,747 — 16,254 — 
RIF cost savings4,878 5,280 10,576 10,366 
Other9,448 2,353 12,926 4,115 
Pro forma -Omni adjusted EBITDA— 48,872 — 93,290 
Consolidated EBITDA$81,325 $101,688 $135,883 $212,570 



The following is a reconciliation of net cash provided by operating activities to free cash flow for the three and six months ended June 30, 2024 and 2023 (in thousands):

Three Months EndedSix Months Ended
June 30, 2024June 30, 2023June 30, 2024June 30, 2023
Net cash (used in) provided by operating activities of continuing operations$(45,200)$56,615 $(96,924)$117,454 
Proceeds from sale of property and equipment557 1,356 1,406 3,171 
Purchases of property and equipment(14,426)(10,317)(19,396)(16,836)
Free cash flow$(59,069)$47,654 $(114,914)$103,789 









12

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 expectations regarding the Company’s long-term growth; ability to achieve and accelerate synergy capture and eliminate costs from our structure; expectations regarding the Company’s expedited freight business; ability to achieve the intended benefits of the acquisition of Omni Logistics, including any revenue and cost synergies; 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; and expectations regarding the Company's revenue growth strategies, including with respect to operational efficiency and cost control.

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, 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 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.

13

Contact:

Investors:
Tony Carreño
investorrelations@forwardair.com

Media:
Justin Moss
(404) 362-8933
jmoss@forwardair.com
14
Forward Air 2Q24 Earnings Presentation August 7, 2024

 
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, including any anticipated growth in the less-than-truckload sector; ability to delever and focus on debt repayment; ability to achieve and timing of capturing the intended benefits of the acquisition of Omni Logistics, including any revenue and cost synergies; ability to reduce operating expenses and increase operating leverage; expectations regarding the timing and impact of forecasted or anticipated savings and ability to reach the run rate; Forward's ongoing commitment to provide excellent service to its customers; expectations regarding Forward's ability to execute on its plan to integrate Omni Logistics in order to generate long-term value for shareholders; expectations regarding Forward's ability to grow and retain its customer base, including the anticipated revenue generated from new customers; expectations regarding Forward's strategies, including with respect to its ability to become more vertically integrated; the anticipated timing of Forward’s plan to rebrand and rename; plans regarding the future declaration of dividends and repurchases; ability to run operations on a predictive and data-driven basis; 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 Adjusted Operating Income, Consolidated EBITDA and Consolidated EBITDA excluding RIF, 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 financial condition and compliance with our obligations under our credit agreement. 2

 
AGENDA 01 02 2Q24 Highlights Integration Update03 04 Leverage and Liquidity Cash Flow 3 All figures throughout presentation in $ millions where applicable LTL KPIs Capital Allocation / Deleveraging Conclusion 06 07 05

 
2Q24 Results Affected by Softness in Freight Cycle but Sequentially Improved ($3M) A DJ US TE D O P ER ATIN G IN CO ME ( 1) $81M CO NS O L IDAT ED E B ITD A ( 2) $445M L IQ UI DIT Y ( 3) 5.2x LTM CO V EN A NT NE T L E V E RA G E ( 2) 1. Non-GAAP financial measure. Reconciliations and other information required by Regulation G can be found in the Appendix section of the presentation. Excludes goodwill impairment charge of $1.1B 2. Non-GAAP financial measure. Please note that this is calculated pursuant to our credit agreement 3. Includes $20M of restricted cash and $17M of cash in foreign subsidiaries $644M RE V E NU E 4

 
1. Pro Forma for Omni acquisition calculated in accordance with Article 11 of Regulation S-X. For more information, please see our 8-K filed on June 10, 2024 2. Non-GAAP financial measure. Please note that Consolidated EBITDA is calculated pursuant to our credit agreement Strong 2Q24 Performance Relative to 1Q24 Positions The Business Well For 2H Pro Forma Revenue Consolidated EBITDA(2) $621 $644 1Q24 2Q24 $55 $81 1Q24 2Q24 (1) (1) 5

 
12.8 13.1 13.3 13.4 12.9 13.6 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 ▪ 2Q24 weight per shipment of 821 pounds with a 2.5% YoY increase ▪ We have seen a mix shift to 3PLs and direct customers who consume primarily D2D services, which typically average higher weight per shipment than A2A moves ▪ 2Q24 revenue per shipment, ex fuel of $200 with a 3.7% YoY increase ▪ Driven by the GRI that became effective in February 2024, strategic pricing initiatives and a shift in the business mix of customer channels during 2Q24 Legacy Forward Air LTL Metrics Stable to Improving 6 Shipments per Day Weight per Shipment Revenue per Shipment Excluding Fuel % YoY change (12.3%) (7.3%) (4.8%) 1.4% 3.4% ▪ 2Q24 shipments per day of 13.6K with a 3.4% YoY increase ▪ Driven by increased demand for our services due to continued high service levels and shift in the business mix of customer channels with incremental volume derived from direct customers in 2Q24 5.4% 7.8% 11.3% 7.4% 2.5% (2.1%) 0.3% 2.4% 0.9% 3.7% In 000’s In pounds In $’s 770 801 821 815 827 821 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 $198 $193 $199 $195 $200 $200 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24

 
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 $38.9M Cumulative ▪ Completed air freight transportation management system consolidation; additional systems conversions to continue into 2025 ▪ Roll out indirect spend initiatives using combined company’s improved buying power ▪ Continuing to progress facilities consolidations End of 1Q25 and Beyond (Run-Rate) ~$75M Annualized 4Q24 Refinement and Improvement $55.3M Cumulative ▪ Harmonization of corporate policies and human capital management in US ▪ Continue IT system consolidations ▪ Continue facilities consolidations Gross Synergies by Quarter in $M $8.3M $14.6M $16.0M $16.4M ▪ 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 (Anticipated) (Anticipated) $18.6M (Anticipated) 7

 
Continuous Improvement Culture 8 ▪ Right-sizing NewCo for combined back office and operations / network ▪ ~$20M of run-rate cost savings incremental to synergies expected by 2025, stemming from SG&A cost-cutting actions already taken ▪ Several synergy projects are establishing a base for more efficient go-forward business model: – Streamlining of IT systems, eliminating duplicative operating locations, restructuring domestic forwarding operating functions ▪ Cost-cutting focus continues with ad hoc initiatives identified inside and outside of synergy capture, from terminal-level vendor spend to procurement initiatives rolling out enterprise-wide discounts ▪ Promoting a culture of collaboration and cooperation ▪ Consolidating business rules, org structures and processes – SOPs – DOA – Benefit policies ▪ Improved efficiency from operating as one company – Back-office integration – Joint operations ▪ April 2024: Shawn Stewart named CEO – Three decades of experience in Global Supply Chain – Has held numerous leadership positions across logistics and transportation - most recently served as President and Managing Director, North America at CEVA Logistics ▪ July 2024: Jamie Pierson named CFO – Extensive experience in transportation and logistics with a demonstrated track record in financial leadership positions – Former A&M operational restructuring professional ▪ July 2024: James Faught named as CAO – Most recently served as CFO of EVO Transportation – Prior to this role, served as Chief Accounting Officer at Yellow Corporation New Leadership Right Sizing the Business Unifying and Streamlining Business / Culture

 
5.0x 5.2x Required Covenant Ratio 6.0x 1Q24 2Q24 1. Non-GAAP financial measure. Please note that is calculated pursuant to our 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 Deleveraging Remains a Key Priority for Management Through Asset Sales and Operational Improvement Term Loan B $1,045 $1,045 Senior Sec. Notes $725 $725 First Lien Debt(2) $1,770 $1,770 Net Cash(3) $136 $68 Net Debt $1,634 $1,702 Consolidated LTM EBITDA(1) $324 $325 Net Leverage(1) Liquidity Gross Cash: $105M Gross Cash: $172M Net Cash Revolving Credit Facility(4) Restricted Cash Deduction Foreign Subsidiary Deduction 340 340 136 68 20 20 16 17 $512 $445 1Q24 2Q24 9

 
10 No Maturities Over Next 6 Years Key Commentary $1,045 $725 2024 2025 2026 2027 2028 2029 2030 2031 First Lien Term Loan Senior Secured Notes ▪ No material maturities within the next 6 years ▪ Plenty of time to effectuate integration and garner benefits of combination No Maturities Until December 2030

 
11 Cash Consumption Continues to Moderate Through 2Q24 1. Amounts exclude letters of credit restricted cash collateral Change in Unrestricted Cash (1) (1) Key Commentary 1• $37M interest payment on Senior Secured Notes, $9M interest payment on Term Loan B • Professional fees associated with Omni transaction, integration, and subsequent amendment • Final earnout payments and net working capital purchase price adjustments related to prior acquisitions 2 3 1 2 3 One-time Items Pro Forma Free Cash Flow 1 2 3 Pro Forma Unlevered Free Cash Flow $12 (-) Debt Service (46) Pro Forma Levered Free Cash Flow ($34) (-) Transaction/Integration Fees (21) (-) Earnouts & Purchase Price Adjustments (12) Net Change in Unrestricted Cash ($67)

 
Remain Committed to Previously Announced Capital Allocation Plan with a Focus on Improving Performance 12 Deleverage ▪ Deleveraging is a key priority, demonstrated by repayment of $80M of term loans in 1Q ▪ Actively reviewing portfolio to identify opportunities to dispose of any non-core assets ▪ Dividends and repurchases stand suspended with focus on deleveraging Dividend & Share Repurchases ▪ Improve operating performance and successfully integrate Omni to function as ONE company Operational Improvement

 
13 2Q24 Summary – Integration and Cost Reductions Progressing and Performance Improving Completed transaction in 1Q24 Brought in new senior leadership in April and May Actioned cost reduction items in late 1Q24 and 2Q24 (i.e., this quarter) 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 focused via asset rationalization and improved performance Transactional cash consumption significantly moderated in 2Q24 and anticipated to inflect in 3Q / 4Q24 Significant sequential Consolidated EBITDA(1) improvement Currently, have adequate covenant cushion and liquidity to complete the integration and garner the increased cash generating capability of the combined companies 1. Non-GAAP financial measure. Please note that Consolidated EBITDA is calculated pursuant to our credit agreement

 
Appendix 14

 
Consolidated EBITDA Reconciliation 3Q23 4Q23 1Q24 2Q24 TTM (6/30/24) Net Income ($59) $30 ($159)(1) ($966) ($1,155) Business Dispositions (Final Mile) (2) (117) (0) (0) (120) Impairment Charge / Asset Write-Off - - - 1,093 1,093 Omni Merger Transaction Costs 36 61 96 2 195 Other (severance, retention, change in fair value etc) 9 (20) 43 34 65 Consolidated Net Income ($17) ($46) ($21) $162 $79 Net Interest Expense 45 67 53 47 213 Taxes 5 0 (16) (174) (184) Depreciation and Amortization 30 33 20 37 119 Trans. Expenses, Integration Costs, & Other Normalizing Adjustments 8 15 2 (2) 23 Pro Forma Cost Synergies 19 19 11 6 54 Consolidated EBITDA Excluding RIF(1) $90 $88 $49 $76 $303 PF June 2024 Headcount Reduction Savings 6 6 6 5 22 Consolidated EBITDA(2) $96 $94 $55 $81 $325 Consolidated First Lien Indebtedness(3) 1,770 Net Cash and Cash Equivalents(4) (68) Net Debt $1,702 Consolidated First Lien Net Leverage Ratio 5.2x 1. Non-GAAP financial measure. Reconciliations and other information required by Regulation G can be found in the Appendix section of the presentation 2. Non-GAAP financial measure. Please note that Consolidated EBITDA is calculated pursuant to our credit agreement 3. As defined in the RCFTL (Revolving Credit Facility Term Loan) credit agreement, represents total amount of debt outstanding, including Term Loan, Senior Secured Notes, and Revolving Credit Facility; excludes finance leases 4. As defined in the RCFTL credit agreement, excludes foreign subsidiaries of $16M (1Q24) and $17M (2Q24) and restricted cash of $20M (1Q24) and $20M (2Q24) Covenant Leverage Reconciliation 15

 
Pro Forma Net Income Reconciliation 1Q24 1Q 2024 Reported Net Income ($89) Standalone Omni (January 1 – January 24, 2024) Net Income (71) Pro Forma 1Q24 Net Income ($159) GAAP to Non-GAAP Reconciliation Adjusted Operating Income Reconciliation 2Q24 Loss from Continuing Operations ($1,096) Impairment of Goodwill 1,093 Adjusted Operating Income ($3)

 
v3.24.2.u1
Cover Page
Aug. 07, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Aug. 07, 2024
Entity Registrant Name FORWARD AIR CORP
Entity Incorporation, State or Country Code TN
Entity File Number 000-22490
Entity Tax Identification Number 62-1120025
Entity Address, Address Line One 1915 Snapps Ferry Road
Entity Address, Address Line Two Building N
Entity Address, City or Town Greeneville
Entity Address, State or Province TN
Entity Address, Postal Zip Code 37745
City Area Code 423
Local Phone Number 636-7000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.01 par value
Trading Symbol FWRD
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000912728
Amendment Flag false
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