Old Dominion Hits A Yellow Light: Earnings Glow, Dividend Boost But Top Line Struggles

Old Dominion Freight Line Inc ODFL shares are diving after it reported fourth-quarter FY23 results.

Revenue rose 0.3% Y/Y to $1.496 billion, marginally missing the consensus of $1.497 billion.

The slight increase in revenue is primarily due to a 3.0% rise in LTL revenue per hundredweight, which more than offset the 2.0% decrease in LTL tons per day.

LTL tons per day decline reflects a 1.5% Y/Y increase in LTL shipments per day and a 3.5% Y/Y decrease in LTL weight per shipment. 

Also, revenue decreased by 21.8% Y/Y in the other services segment in the quarter.

Operating income decreased by 2.1% Y/Y to $421.0 million, with an operating ratio of 71.8%, compared to 71.2% a year ago.

EPS of $2.94 beat the consensus of $2.85.

Old Dominion’s operating cash flow was $436.7 million for the fourth quarter of 2023. The company had $433.8 million in cash and equivalents as of Dec. 31, 2023. Capital expenditures stood at $105.9 million in the fourth quarter of 2023.

Dividend: The board of directors raised the first-quarter dividend by 30% to $0.52 per share, payable on March 20, 2024, to shareholders of record as of March 6, 2024. 

In 2023, Old Dominion returned $453.6 million through share repurchases and $175.1 million via cash dividends to the stockholders.

“We continued to invest in our OD Family of employees as well as our service center network, our equipment and our technology,” said Marty Freeman, president and CEO.

“The combination of these investments, and our long-term record of superior service, has created an unmatched value proposition that continues to differentiate Old Dominion from our competition. As a result, we believe we are strongly positioned to respond to a positive inflection in demand once the domestic economy begins to improve.”

Also Read: Transport Company Old Dominion Freight Line Posts Weak November Metrics On Weak Economy: Here’s Details

ODFL Price Action:  Old Dominion Freight Line shares are up 1.03% at $399.94 on last check Wednesday.

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