Transport and logistics company TFI International Inc. posted fourth-quarter adjusted earnings of $1.71 per diluted share, a 4-cent-per-diluted-share beat from consensus estimates. Alain Bédard, the company’s chairman, president and CEO, told analysts that he expects full-year earnings per share to exceed $7 per diluted share on an organic basis, bettering 2023’s $6.18 per share but below 2022’s $8.02 per diluted share.

On an analyst call Friday morning, Bédard said the turnaround at Montreal-based TFI’s (NYSE: TFII) struggling U.S. LTL operation, TForce Freight, remains a work in progress but is improving. Operating ratio, the ratio of revenues to expenses, ended 2023 at 91%, a figure Bédard said will be unacceptable in 2024. He expected to reduce the OR to 88% by the end of the year, but those efficiencies will be a second-half story.

The unit expects to handle 24,000 to 25,000 shipments per day, well down from when TFI acquired it from UPS Inc. nearly three years ago. TForce Freight has culled as much unprofitable or marginally profitable freight as possible from its network, and 2024 will be a volume growth story, Bédard said.

TForce Freight reduced its cargo claims ratio in the quarter to 0.5%, down from 1.5% a year earlier, Bédard said. Still, the unit’s costs remain elevated, especially in billing, where too many errors lead to inefficiencies, he said.

Bédard also said TFI continues to explore a spinoff of its truckload business, an announcement made at the time it disclosed its offer for Daseke at the end of December. The Daseke acquisition is expected to close in the second quarter. TFI declined to give full-year guidance either in the communique announcing the quarterly and full-year results or on the analyst call. Bédard said the company will remain cautious ahead of the close of the Daseke deal but said he will provide more clarity on the balance of the year after the first quarter ends.

The executive said TFI performed well in the quarter given the weak operating environment that impacted three of its four business units. The one exception was the company’s logistics division, where revenue, operating income and net income jumped year over year. Otherwise, TFI’s LTL, truckload, and package and courier divisions posted year-on-year declines in revenue, operating and net income. Bédard said the macro environment remains challenging.

The post TFI beats earnings estimates, US LTL a work in progress appeared first on FreightWaves.

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