契诺物流 2024年度报告

(1)Net margin is net income as a percentage of freight revenue.(2)Adjusted operating expenses, net of fuel surcharge revenue and amortization of intangibles, as a percentage offreight revenue.(3)Adjusted operating ratio and Adjusted ROIC are non-GAAP financial measures. Please see the reconciliation onpages iii and iv of this Annual Report.(4)Calculated as follows: the sum of adjusted operating income after tax at our effective tax rate as a percentage ofthe sum of average trailing twelve months balance sheet total net assets (total assets net of cash and cashequivalents) less average trailing twelve months total current liabilities, net of debt and finance leases. This Annual Report contains certain statements that may be considered forward-looking statements within themeaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of1934, as amended and such statements are subject to the safe harbor created by those sections and the PrivateSecurities Litigation Reform Act of 1995, as amended. Such statements may be identified by their use of terms orphrases such as “believe,” “may,” “could,” “would,” “will,” “expects,” “estimates,” “projects,” “appears,”“mission,”“anticipates,”“plans,”“outlook,”“focus,”“seek,”“potential,”“continue,”“goal,”“target,”“objective,”,“optimistic”,”intends,”derivations thereof,and similar terms and phrases.Forward-lookingstatements are based upon the current beliefs and expectations of our management and inherently subject to risks anduncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results todiffer materially from those set forth in, contemplated by, or underlying the forward-looking statements. Readersshould review and consider the factors discussed in the “Risk Factors” section of this Annual Report, along withvarious disclosures in our press releases, stockholder reports, and other filings with the Securities and ExchangeCommission. We disclaim any obligation to update or revise any forward-looking statements to reflect actual resultsor changes in the factors affecting the forward-looking information. On December 31, 2024, after market close, the Company effected a 2 for 1 forward split on its Class A common stockand Class B common stock outstanding in the form of a stock dividend, under which each stockholder of theCompany’s Class A common stock on that date received one additional share of the Company’s $0.01 par value ClassA common stock for every one share owned and each stockholder of the Company’s Class B common stock on thatdate received one additional share of the Company’s $0.01 par value Class B common stock for every one shareowned. All share and per share amounts presented in this Annual Report, including with respect to dividends and inthe financial statement and notes hereto have been adjusted for the stock split, except for the share amounts presentedin the stockholders’ equity section of our consolidated balance sheets. COVENANT LOGISTICS GROUP, INC. Dear Fellow Stockholders, Our company continues to outperform the truckload industry amidst challenging operating conditions.Operatingresults improved modestly compared to 2023, a nearly singular achievement in an industry in which declining earningshas been the norm for two-plus years.We attribute this achievement to focusing on “nichey” businesses with highservice standards that limit the commoditization of our services, a culture of integrity, collaboration and value, andintense effort toward service, safety, and cost control. With a sound strategy, a vigorous management team, and accessto the resources we need, our company’s future is bright. Our business has been resilient in the face of an historically deep and extended general freight market downturn. Theimpact of this downturn on Covenant has been limited because we invested in M&A and growth assets in less cyclicalend markets, primarily in our specialized Dedicated and Expedited units. At the same time, we negotiated contractualprotections with certain other customers where our services add unique value, and we grew our warehousing unit. Asignificant portion of our revenue comes from these more stable areas, while the remainder is more exposed to marketfluctuations.Although this business mix has lowered our downside risk during the extended downturn, it will alsolimit our flexibility to quickly reprice our services in the next strong freight market. Due to our long-term focus anddesire to manage volatility where possible, this is a trade-off we are willing to make. While our business model mitigated some of the market pressure on rates and volumes, our earnings remained exposedto weakness in the used equipment market. The combination of lower gain on sale of revenue producing equipmentand lower contribution from our 49% ownership of TEL was an approximately $13 million pretax, or 34 cents pershare, drag on earnings from 2023 to 2024. In a stro