What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-11-09 compared with 2022-08-09 · 147 added, 127 removed, 610 unchanged (31% of the section changed)

3 unchanged sentences

(unaudited and in thousands, except share and per share amounts)

September 30,

2022 December 31,

43 unchanged sentences

Three Months Ended

2022 June 30,

September 30,

2022 September 30,

Operating revenues $ 510,023 $ 419,625

30 unchanged sentences

(unaudited and in thousands, except per share amounts)

Six Months Ended

2022 June 30,

Nine Months Ended

September 30,

2022 September 30,

Operating revenues $ 1,492,203 $ 1,202,498

21 unchanged sentences

Net income per basic share 1

$ 5.56 $ 2.39

Diluted net income (loss) per share

3 unchanged sentences

Dividends per share $ 0.72 $ 0.63

1 Rounding may impact summation of amounts.

The accompanying notes are an integral part of the condensed consolidated financial statements.

2 unchanged sentences

(unaudited and in thousands)

Six Months Ended

2022 June 30,

Nine Months Ended

September 30,

2022 September 30,

Operating activities:

22 unchanged sentences

Payments on credit facility ( 48,625 ) —

Payment of debt issuance costs — ( 119 )

Payment of earn-out liability ( 91 ) ( 6,519 )

5 unchanged sentences

Contributions from subsidiary held for sale — 1,118

Net cash (used in) provided by financing activities from continuing operations ( 44,411 ) 733

Net cash used in financing activities from continuing operations ( 122,873 ) ( 27,347 )

Net increase in cash and cash equivalents of continuing operations 9,530 11,676

32 unchanged sentences

Balance at June 30, 2022 26,880 $ 269 $ 265,129 $ 398,952 $ 664,350

Net income — — — 52,133 52,133

Share-based compensation expense — — 2,676 — 2,676

Payment of dividends to shareholders — — 4 ( 6,471 ) ( 6,467 )

Repurchases and retirement of common stock ( 290 ) ( 3 ) — ( 29,991 ) ( 29,994 )

Balance at September 30, 2022 26,590 $ 266 $ 267,809 $ 414,623 $ 682,698

Common Stock Additional Paid-in

19 unchanged sentences

Balance at June 30, 2021 27,120 $ 271 $ 252,466 $ 297,612 $ 550,349

Net income — — — 23,536 23,536

Share-based compensation expense — — 2,601 — 2,601

Payment of dividends to shareholders — — 4 ( 5,709 ) ( 5,705 )

Payment of minimum tax withholdings on share-based awards ( 3 ) — — ( 248 ) ( 248 )

Repurchases and retirement of common stock ( 169 ) ( 1 ) — ( 14,996 ) ( 14,997 )

Issuance of share-based awards 10 — — — —

Balance at September 30, 2021 26,958 $ 270 $ 255,071 $ 300,195 $ 555,536

The accompanying notes are an integral part of the condensed consolidated financial statements.

2 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

September 30, 2022

Description of Business and Basis of Presentation

34 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

September 30, 2022

time in each reporting period.

8 unchanged sentences

As previously disclosed, on April 23, 2020, the Company made a decision to divest of Pool and the sale was completed on February 12, 2021.

As a result, the results of Pool were classified to “Loss from discontinued operation, net of tax” in the Condensed Consolidated Statements of Comprehensive Income for three and six months ended June 30, 2021.

As a result, the results of Pool were classified to “Loss from discontinued operation, net of tax” in the Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2021.

Certain corporate overhead and other costs previously allocated to Pool for segment reporting purposes did not qualify for classification within discontinued operation and were allocated to continuing operations.

6 unchanged sentences

In exchange for the services performed by the Company under the TSA, the Company received a monthly service charge.

For the three and six months ended June 30, 2021, the Company recognized $ 241 and $ 412 , respectively, in “Other operating expenses ” in the Condensed Consolidated Statements of Comprehensive Income, for the services performed under the TSA.

For the three and nine months ended September 30, 2021, the Company recognized $ 229 and $ 641 , respectively, in “Other operating expenses ” in the Condensed Consolidated Statements of Comprehensive Income, for the services performed under the TSA.

The TSA ended in October 2021 when all services were completed.

Additionally, under the TSA, the Company remitted payments to outside vendors on behalf of TOG FAS Holdings LLC for expenses incurred by the Pool business up to a limit of $ 18,000 .

The Company was reimbursed by TOG FAS Holdings LLC within 60 days from the end of the month in the payment was remitted.

As of June 30, 2022 and December 31, 2021, the Company recorded a net receivable in the amount of $ 104 and $ 8,097 respectively, in “Other receivables ” in the Condensed Consolidated Balance Sheets for the reimbursement due to the Company.

The Company evaluates the collectability of the receivables at least quarterly and if the Company is aware of the inability of TOG FAS Holdings LLC to meet its financial obligations to the Company, the Company will record a specific reserve in order to reduce the receivable to the amount the Company reasonably believes will be collected.

As of June 30, 2022, the Company recorded a specific reserve in the amount of $ 900 in order to reduce the receivable to the amount the Company reasonably believes will be collected.

The Company was reimbursed by TOG FAS Holdings LLC within 60 days from the end of the month in which the payment was remitted.

As of September 30, 2022 and December 31, 2021, the Company recorded a net receivable in the amount of zero and $ 8,097 respectively, in “Other receivables ” in the Condensed Consolidated Balance Sheets for the reimbursement due to the Company.

The Company evaluates the collectability of the receivable at least quarterly and if the Company is aware of the inability of TOG FAS Holdings LLC to meet its financial obligations to the Company, the Company will record a specific reserve in order to reduce the receivable to the amount the Company reasonably believes will be collected.

As of September 30, 2022, the Company recorded a specific reserve in the amount of $ 235 in order to reduce the receivable to an amount the Company reasonably believes will be collected.

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

September 30, 2022

Summarized Discontinued Operation Financial Information

A summary of the results of operations classified as a discontinued operation, net of tax, in the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2021 is as follows:

Three Months Ended

June 30, 2021 Six Months Ended June 30, 2021

A summary of the results of operations classified as a discontinued operation, net of tax, in the Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2021 is as follows:

Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021

Operating revenue $ — $ 17,087

7 unchanged sentences

Other operating expenses — 2,087

Impairment charge 6,967 6,967

Total operating expenses 6,967 27,498

11 unchanged sentences

The fair value of the earn-out liability was adjusted at each reporting period based on changes in the expected cash flows and related assumptions used in the option pricing method.

During the three and six months ended June 30, 2022, the fair value of the earn-out changed by $ — and ($ 294 ) respectively, and the change in fair value was recorded in “Other operating expenses” in the Condensed Consolidated Statements of Comprehensive Income.

During both the three and six months ended June 30, 2021, the fair value of the earn-out changed by ($ 333 ), and the change in fair value was recorded in “Other operating expenses” in the Condensed Consolidated Statements of Comprehensive Income .

During the three and nine months ended September 30, 2022, the fair value of the earn-out changed by zero and ($ 294 ) respectively, and the change in fair value was recorded in “Other operating expenses” in the Condensed Consolidated Statements of Comprehensive Income.

During the three and nine months ended September 30, 2021, the fair value of the earn-out changed by zero and ($ 333 ) respectively, and the change in fair value was recorded in “Other operating expenses” in the Condensed Consolidated Statements of Comprehensive Income .

The one-year period ended in the first quarter of 2022 and the Company paid $ 91 in the second quarter of 2022 based on the terms of the purchase agreement.

3 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

September 30, 2022

In November 2021, the Company acquired certain assets and liabilities of BarOle Trucking, Inc.

6 unchanged sentences

The associated goodwill has been included in the Company’s Intermodal reportable segment.

In May 2022, the Company acquired certain assets and liabilities of Edgmon Trucking, LLC (“Edgmon”) for $ 40,433 and a potential earn-out of up to $ 5,000 .

In May 2022, the Company acquired certain assets and liabilities of Edgmon Trucking, LLC (“Edgmon”) for $ 40,433 and a potential earn-out of up to $ 5,000 , based on the achievement of certain profit contribution milestones over a nineteen month period, beginning May 30, 2022.

Edgmon, headquartered in Kent, Washington, operates a terminal in Kent and a yard in Seattle, servicing both the Port of Seattle and the Port of Tacoma.

3 unchanged sentences

The associated goodwill has been included in the Company’s Intermodal reportable segment.

The purchase agreement for Edgmon included an earn-out up to $ 5,000 based on the achievement of certain profit contribution milestones over a nineteen month period, beginning May 30, 2022.

An estimated fair value of the earn-out liability on the date of acquisition is in process and is excluded from the preliminary purchase price.

As the Company finalizes the valuation of the preliminary purchase price, the fair value will based on the estimated nineteen month profit contribution of the acquired operations and will be calculated using the option pricing method.

Fair Value of Assets Acquired and Liabilities Assumed

17 unchanged sentences

The preliminary purchase price for BarOle and Edgmon has been allocated to assets acquired and liabilities assumed based on the Company’s best estimates and assumptions using the information available as of the acquisition date through the date of this filing.

The provisional measurements of identifiable assets and liabilities, and the resulting goodwill related to these acquisitions are subject to adjustments in subsequent periods as the Company finalizes its purchase price allocation, including the third-party valuations.

During the six months ended June 30, 2022, the Company recorded measurement period adjustments to the provisional amounts initially recorded for acquired property and equipment and acquired customer relationships and non-compete agreements related to the BarOle acquisition.

The measurement period adjustments resulted in a $ 1,113 increase to acquired property and equipment and a combined $ 4,955 decrease to acquired customer relationships and non-compete

The provisional measurements of identifiable assets and liabilities, and the resulting goodwill related to these acquisitions, are subject to adjustments in subsequent periods as the Company finalizes its purchase price allocations, including the third-party valuations.

During the nine months ended September 30, 2022, the Company recorded measurement period adjustments to the provisional amounts initially recorded for acquired property and equipment and acquired customer relationships and non-compete agreements related to the BarOle acquisition.

The measurement period adjustments resulted in a $ 1,113 increase to acquired property and equipment and a combined $ 5,854 decrease to acquired customer relationships and non-compete agreements, with a corresponding net increase to goodwill.

The Company expects to finalize the valuations as soon as practicable, but no later than one year from the respective acquisition dates.

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

agreements, with a corresponding net increase to goodwill.

The Company expects to finalize the valuation as soon as practicable, but no later than one year from the respective acquisition dates.

The estimated useful life of acquired intangible assets as of the acquisition date are summarized in the following table:

September 30, 2022

The estimated useful lives of acquired intangible assets as of the acquisition date are summarized in the following table:

Estimated Useful Lives

3 unchanged sentences

Goodwill and Intangible Assets

Changes in the carrying amount of goodwill during the six months ended June 30, 2022 are summarized as follows:

Changes in the carrying amount of goodwill during the nine months ended September 30, 2022 are summarized as follows:

Expedited Freight Intermodal Consolidated

2 unchanged sentences

Acquisition adjustment — 4,741 4,741

Balance as of June 30, 2022 $ 169,288 $ 118,309 $ 287,597

The Company’s accumulated goodwill impairment is $ 25,686 related to impairment charges the Company recorded during 2016 pertaining to its TLS reporting unit.

The TLS reporting unit operates within the Expedited Freight reportable segment.

As of June 30, 2022, approximately $ 208,454 of goodwill is deductible for tax purposes.

Balance as of September 30, 2022 $ 169,288 $ 119,208 $ 288,496

The Company’s accumulated goodwill impairment is $ 25,686 related to impairment charges the Company recorded during 2016 pertaining to its Truckload Services reporting unit.

The Truckload Services reporting unit operates within the Expedited Freight reportable segment.

As of September 30, 2022, approximately $ 209,353 of goodwill is deductible for tax purposes.

Goodwill is tested for impairment on an annual basis and more often if indications of impairment exist.

The Company conducts its annual impairment analyses as of June 30 each year.

The results of the Company’s goodwill impairment analyses conducted as of June 30, 2022 indicated that no reduction in the carrying amount of the goodwill was required.

There have been no indicators of impairment during the three months ended September 30, 2022.

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

September 30, 2022

Other Intangible Assets

Changes in the carrying amount of acquired intangible assets during the six months ended June 30, 2022 are summarized as follows:

Changes in the carrying amount of acquired intangible assets during the nine months ended September 30, 2022 are summarized as follows:

Gross Carrying Amount

4 unchanged sentences

Acquisition adjustment ( 5,162 ) ( 692 ) — ( 5,854 )

Balance as of June 30, 2022 $ 265,073 $ 8,940 $ 1,500 $ 275,513

Balance as of September 30, 2022 $ 264,165 $ 8,949 $ 1,500 $ 274,614

Accumulated Amortization

3 unchanged sentences

Amortization expense 11,507 610 — 12,117

Balance as of June 30, 2022 $ 106,606 $ 7,191 $ 1,500 $ 115,297

1 Carrying value as of June 30, 2022 and December 31, 2021 is inclusive of $ 16,501 of accumulated impairment.

Balance as of September 30, 2022 $ 110,600 $ 7,353 $ 1,500 $ 119,453

1 Carrying value as of September 30, 2022 and December 31, 2021 is inclusive of $ 16,501 of accumulated impairment.

Stock Incentive Plans

Stock Incentive Plan

The Company recorded share-based compensation expense as follows for the three and six months ended June 30, 2022 and 2021:

Three Months Ended Six Months Ended

2022 June 30,

2021 June 30,

2022 June 30,

The Company recorded share-based compensation expense as follows for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended Nine Months Ended

September 30,

2022 September 30,

2021 September 30,

2022 September 30,

Salaries, wages and employee benefits - continuing operations $ 2,355 $ 2,283 $ 7,661 $ 7,015

2 unchanged sentences

In May 2016, the Company adopted the 2016 Omnibus Incentive Compensation Plan (the “Omnibus Plan”) for the issuance of up to 2,000 common shares to employees.

As of June 30, 2022, appro ximately 687 s hares remain available for grant under the Omnibus Plan.

As of September 30, 2022, appro ximately 693 s hares remain available for grant under the Omnibus Plan.

Stock Options

6 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

Stock option transactions during the six months ended June 30, 2022 on a continuing operations basis were as follows:

September 30, 2022

Stock option transactions during the nine months ended September 30, 2022 on a continuing operations basis were as follows:

Stock Options Weighted-Average Exercise Price

3 unchanged sentences

Forfeited ( 6 ) 106.29

Outstanding as of June 30 397 $ 65.32

As of June 30, 2022, the total share-based compensation expense related to unvested stock options not yet recognized was $ 1,931 , and the weighted-average period over which it is expected to be recognized is approximately two years .

Outstanding as of September 30 397 $ 65.32

As of September 30, 2022, the total share-based compensation expense related to unvested stock options not yet recognized was $ 1,687 , and the weighted-average period over which it is expected to be recognized is approximately two years .

Restricted Shares

3 unchanged sentences

Share-based compensation expense associated with these awards is amortized ratably over the requisite service period.

Restricted share transactions during the six months ended June 30, 2022 on a continuing operations basis were as follows:

Restricted share transactions during the nine months ended September 30, 2022 on a continuing operations basis were as follows:

Restricted Shares Weighted-Average Grant Date Fair Value

3 unchanged sentences

Forfeited ( 25 ) 84.20

Outstanding as of June 30 162 $ 87.46

As of June 30, 2022, the total share-based compensation expense related to restricted shares not yet recognized was $ 11,417 , and the weighted-average period over which it is expected to be recognized is approximately two years .

Outstanding as of September 30 155 $ 87.42

As of September 30, 2022, the total share-based compensation expense related to restricted shares not yet recognized was $ 9,402 , and the weighted-average period over which it is expected to be recognized is approximately two years .

Performance Awards

7 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

Performance award transactions during the six months ended June 30, 2022 on a continuing operations basis were as follows assuming target levels of performance:

September 30, 2022

Performance award transactions during the nine months ended September 30, 2022 on a continuing operations basis were as follows assuming target levels of performance:

Performance Awards Weighted-Average Grant Date Fair Value

3 unchanged sentences

Forfeited or unearned ( 16 ) 74.79

Outstanding as of June 30 70 $ 87.74

As of June 30, 2022, the total share-based compensation expense related to unearned performance awards not yet recognized, assuming the Company’s current projected assessment of the level of performance that will be achieved, was $ 4,070 , and the weighted-average period over which it is expected to be recognized is approximately two years .

Outstanding as of September 30 70 $ 87.74

As of September 30, 2022, the total share-based compensation expense related to unearned performance awards not yet recognized, assuming the Company’s current projected assessment of the level of performance that will be achieved, was $ 3,448 , and the weighted-average period over which it is expected to be recognized is approximately two years .

Employee Stock Purchase Plan

3 unchanged sentences

Employee stock purchase plan activity and related information was as follows on a continuing operations basis:

Six Months Ended

2022 June 30,

Nine Months Ended

September 30,

2022 September 30,

Shares purchased by participants under the ESPP 5 5

5 unchanged sentences

Under the Amended and Restated Non-Employee Director Stock Plan (the “Amended Plan”), approved in May 2007 and further amended in February 2013 and January 2016, up to 360 of common shares may be issued.

As of June 30, 2022, approxim ately 60 shares re main available for grant under the Amended Plan.

As of September 30, 2022, approxim ately 60 shares re main available for grant under the Amended Plan.

Under the Amended Plan, each non-employee director receives an annual grant of restricted shares of the Company’s common stock.

3 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

Director restricted share transactions during the six months ended June 30, 2022 were as follows:

September 30, 2022

Director restricted share transactions during the nine months ended September 30, 2022 were as follows:

Director Restricted Shares Weighted-Average Grant Date Fair Value

3 unchanged sentences

Forfeited — —

Outstanding as of June 30 15 $ 93.70

For the three and six months ended June 30, 2022, the Company recorded $ 380 and $ 719 , respectively, of share-based compensation expense associated with these grants.

For the three and six months ended June 30, 2021, the Company recorded $ 400 and $ 728 , respectively, of share-based compensation expense associated with these grants.

As of June 30, 2022, the total share-based compensation expense related to the restricted shares not yet recognized was $ 1,187 , and the weighted-average period over which it is expected to be recognized is approximately less than one year .

Outstanding as of September 30 15 $ 93.70

For the three and nine months ended September 30, 2022, the Company recorded $ 321 and $ 1,040 , respectively, of share-based compensation expense associated with these grants.

For the three and nine months ended September 30, 2021, the Company recorded $ 318 and $ 1,046 , respectively, of share-based compensation expense associated with these grants.

As of September 30, 2022, the total share-based compensation expense related to the restricted shares not yet recognized was $ 841 , and the weighted-average period over which it is expected to be recognized is approximately less than one year .

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

Long-term debt consisted of the following as of June 30, 2022 and December 31, 2021:

September 30, 2022

Long-term debt consisted of the following as of September 30, 2022 and December 31, 2021:

September 30,

2022 December 31,

13 unchanged sentences

Such increases to the Facility may be in the form of additional revolving credit loans, term loans or a combination thereof, and are contingent upon there being no events of default under the Facility.

As of June 30, 2022 and December 31, 2021, the Company had $ 279,966 and $ 272,466 respectively, of available borrowing capacity under the Facility.

As of September 30, 2022 and December 31, 2021, the Company had $ 279,966 and $ 272,466 respectively, of available borrowing capacity under the Facility.

The Facility contains covenants that, among other things, restrict the ability of the Company, without the approval of the required lenders, to engage in certain mergers, consolidations, asset sales, dividends and stock repurchases, investments, and other transactions or to incur liens or indebtedness in excess of agreed thresholds, as set forth in the credit agreement.

The Company also has to fulfill financial covenants with respect to a leverage ratio and an interest coverage ratio.

As of June 30, 2022, the Company was in compliance with the aforementioned covenants.

As of September 30, 2022, the Company was in compliance with the aforementioned covenants.

Under the amended Facility, interest accrues on the amounts outstanding under the Facility at the Company ’s option, at either (1) Bloomberg Short-Term Bank Yield Index rate (the “BSBY Ra te”), which cannot be less than zero , plus a margin ranging from 1.25 % to 1.75 % based on the Company’s leverage ratio, or (2) the base rate, which cannot be less than 2.00 %.

1 unchanged sentence

Interest is payable in arrears for each loan that is based on the BSBY rate on the last day o f the interest period applicable to each loan, and interest is payable in arrears on loans not based on the BSBY rate on the last day of each quarter.

The interest rate on the outstanding borrowings under the Facility was 2.14 % as of June 30, 2022 and 3.25 % as of June 30, 2021.

The interest rate on the outstanding borrowings under the Facility was 3.33 % as of September 30, 2022 and 1.35 % as of September 30, 2021.

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

Previously, under the Facility, interest accrued on the amounts outstanding under the Facility, at the Company’s option, at either (1) London Interbank Offered Rate (“LIBOR ” ) rate, not less than 1.00 %, plus a margin ranging from 2.25 % to 2.75 % based on the Company’s leverage ratio, or (2) base rate, which cannot be less than 3.00 %.

The base rate was the highest of (i) the federal funds rate, not less than zero , plus 0.50 %, (ii) the administrative agent’s prime rate and (iii) the LIBOR rate, not less than 1.00 %, plus 1.00 %, plus a margin ranging from 0.25 % to 0.75 % based on the Company’s leverage ratio.

Interest was payable in arrears for each loan that was based on the LIBOR rate on the last day of the interest period applicable to each loan, and interest was payable in arrears on loans not based on the LIBOR rate on the last day of each quarter.

September 30, 2022

Letters of Credit

The Company has an arrangement under the Facility to issue letters of credit, which guarantee the Company’s obligations for potential claims exposure for insurance coverage.

As of both June 30, 2022 and December 31, 2021, outstanding letters of credit totaled $ 20,034 .

As of both September 30, 2022 and December 31, 2021, outstanding letters of credit totaled $ 20,034 .

Net Income (Loss) Per Share

5 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

A reconciliation of net income (loss) attributable to Forward Air and weighted-average common shares outstanding for purposes of calculating basic and diluted net income (loss) per share during the three and six months ended June 30, 2022 and 2021 is as follows:

Three Months Ended Six Months Ended

2022 June 30,

2021 June 30,

2022 June 30,

September 30, 2022

A reconciliation of net income (loss) attributable to Forward Air and weighted-average common shares outstanding for purposes of calculating basic and diluted net income (loss) per share during the three and nine months ended September 30, 2022 and 2021 is as follows:

Three Months Ended Nine Months Ended

September 30,

2022 September 30,

2021 September 30,

2022 September 30,

Net income and comprehensive income from continuing operations $ 52,133 $ 30,503 $ 150,249 $ 77,894

13 unchanged sentences

Net income per basic share 1

$ 1.94 $ 0.86 $ 5.56 $ 2.39

Diluted net income (loss) per share:

2 unchanged sentences

Net income per diluted share $ 1.93 $ 0.86 $ 5.53 $ 2.37

1 Rounding may impact summation of amounts.

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

The number of shares that were not included in the calculation of net income (loss) per diluted share because to do so would have been anti-dilutive for the three and six months ended June 30, 2022 and 2021 are as follows:

Three Months Ended Six Months Ended

2022 June 30,

2021 June 30,

2022 June 30,

September 30, 2022

The number of shares that were not included in the calculation of net income (loss) per diluted share because to do so would have been anti-dilutive for the three and nine months ended September 30, 2022 and 2021 are as follows:

Three Months Ended Nine Months Ended

September 30,

2022 September 30,

2021 September 30,

2022 September 30,

Anti-dilutive stock options 57 39 49 39

2 unchanged sentences

Total anti-dilutive shares 70 39 60 39

For the six months ended June 30, 2022 and 2021, the Company recorded income tax expense of $ 32,803 and $ 14,969 , respectively, for continuing operations.

The effective tax rate of 25.1 % for the six months ended June 30, 2022 varied from the statutory United States federal income tax rate of 21.0% primarily due to the effect of state income taxes, net of the federal benefit, and non-deductible executive compensation, partially offset by excess tax benefits realized on share-based awards.

The effective tax rate of 24.0 % for the six months ended June 30, 2021 varied from the statutory United States federal income tax rate of 21.0% primarily due to the effect of state income taxes, net of the federal benefit, and non-deductible executive compensation, partially offset by excess tax benefits realized on share-based awards.

For the nine months ended September 30, 2022 and 2021, the Company recorded income tax expense of $ 50,791 and $ 25,969 , respectively, for continuing operations.

The effective tax rate of 25.3 % for the nine months ended September 30, 2022 varied from the statutory United States federal income tax rate of 21.0% primarily due to the effect of state income taxes, net of the federal benefit, and non-deductible executive compensation, partially offset by excess tax benefits realized on share-based awards.

The effective tax rate of 25.0 % for the nine months ended September 30, 2021 varied from the statutory United States federal income tax rate of 21.0% primarily due to the effect of state income taxes, net of the federal benefit, and non-deductible executive compensation, partially offset by excess tax benefits realized on share-based awards.

The Company recognizes income tax benefits from uncertain tax positions where the realization of the ultimate benefit is uncertain.

As of both June 30, 2022 and December 31, 2021, the Company had $ 241 of unrecognized income tax benefits, all of which would affect the Company’s effective tax rate if recognized.

As of both June 30, 2022 and December 31, 2021, the Company had accrued interest and penalties related to unrecognized tax benefits of $ 88 .

As of both September 30, 2022 and December 31, 2021, the Company had $ 241 of unrecognized income tax benefits, all of which would affect the Company’s effective tax rate if recognized.

As of both September 30, 2022 and December 31, 2021, the Company had accrued interest and penalties related to unrecognized tax benefits of $ 88 .

With a few exceptions, the Company is no longer subject to U.S.

16 unchanged sentences

and model-derived valuations in which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

• Level 3 - Model-derived valuations in which one or more significant inputs are unobservable.

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

September 30, 2022

• Level 3 - Model-derived valuations in which one or more significant inputs are unobservable.

As previously discussed in Note 4, Acquisitions, the estimated fair value of the earn-out liability was determined using the option pricing method.

1 unchanged sentence

Observable inputs used in the option pricing method include the risk-free rate and the revenue volatility while unobservable inputs include the revenue discount rate and the estimated revenue projections.

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 are summarized below:

As of June 30, 2022

Assets and liabilities measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021 are summarized below:

As of September 30, 2022

Level 1 Level 2 Level 3 Total

5 unchanged sentences

The carrying amount of long-term debt under the Company’s credit facility approximates fair value based on the borrowing rates currently available to the Company for a loan with similar terms and average maturity.

As of June 30, 2022, the estimated fair value of the Company’s finance lease obligation, based on current borrowing rates, was $ 16,386 , compared to its carrying value of $ 16,769 .

As of September 30, 2022, the estimated fair value of the Company’s finance lease obligation, based on current borrowing rates, was $ 16,923 , compared to its carrying value of $ 17,531 .

As of December 31, 2021, the estimated fair value of the Company’s finance lease obligation, based on current borrowing rates, was $ 14,312 , compared to its carrying value of $ 14,159 .

1 unchanged sentence

Cash Dividends

During the first and second quarters of 2022, the Board declared and the Company has paid a quarterly cash dividend of $ 0.24 per common share.

During the first, second and third quarters of 2022, the Board declared and the Company has paid a quarterly cash dividend of $ 0.24 per common share.

During each quarter of 2021, the Company’s Board of Directors declared and the Company has paid a quarterly cash dividend of $ 0.21 per common share.

On July 26, 2022, the Board declared a quarterly cash dividend of $ 0.24 per common share that will be paid in the third quarter of 2022.

On October 25, 2022, the Board declared a quarterly cash dividend of $ 0.24 per common share that will be paid in the fourth quarter of 2022.

Share Repurchase Program

4 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

During the six months ended June 30, 2022, the Company repurchased through open market transactions 176 shares of common stock for $ 17,780 , or an average of $ 100.86 per share, and during the six months ended June 30, 2021, the Company repurchased through open market transactions 366 shares of common stock for $ 33,992 , or an average of $ 92.76 per share.

September 30, 2022

During the nine months ended September 30, 2022, the Company repurchased through open market transactions 466 shares of common stock for $ 47,774 , or an average of $ 102.44 per share, and during the nine months ended September 30, 2021, the Company repurchased through open market transactions 535 shares of common stock for $ 48,989 , or an average of $ 91.46 per share.

All shares received were retired upon receipt, and the excess of the purchase price over the par value per share was recorded to “Retained Earnings ” in the Condensed Consolidated Balance Sheets.

As of June 30, 2022, the remaining shares permitted to be repurchased under the 2019 Repurchase Plan were approximately 2,657 shares.

As of September 30, 2022, the remaining shares permitted to be repurchased under the 2019 Repurchase Plan were approximately 2,366 shares.

Commitments and Contingencies

26 unchanged sentences

The Company accrues for the costs of the uninsured portion of pending claims within the self-insured retention based on the nature and severity of individual claims and historical claims development trends.

The Company believes the recorded reserves are sufficient for all incurred claims up to the self-insured retention limits, including an estimate for claims incurred

The Company believes the recorded

Forward Air Corporation

1 unchanged sentence

(unaudited and in thousands, except per share data)

June 30, 2022

but not reported.

September 30, 2022

reserves are sufficient for all incurred claims up to the self-insured retention limits, including an estimate for claims incurred but not reported.

However, estimating the number and severity of claims, as well as related judgment or settlement amounts is inherently difficult, and the Company may fail to establish sufficient insurance reserves and adequately estimate for future insurance claims.

15 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

Segment results from operations for the three and six months ended June 30, 2022 and 2021 are as follows:

Three Months Ended June 30, 2022

September 30, 2022

Segment results from operations for the three and nine months ended September 30, 2022 and 2021 are as follows:

Three Months Ended September 30, 2022

Expedited Freight Intermodal Corporate Eliminations Consolidated - Continuing Operations

5 unchanged sentences

Purchases of property and equipment 6,434 294 — — 6,728

Three Months Ended June 30, 2021

Three Months Ended September 30, 2021

Expedited Freight Intermodal Corporate Eliminations Consolidated - Continuing Operations

5 unchanged sentences

Purchases of property and equipment 13,769 671 — — 14,440

Six Months Ended June 30, 2022

Nine Months Ended September 30, 2022

Expedited Freight Intermodal Corporate Eliminations Consolidated - Continuing Operations

5 unchanged sentences

Purchases of property and equipment 24,155 1,246 — — 25,401

Six Months Ended June 30, 2021

Nine Months Ended September 30, 2021

Expedited Freight Intermodal Corporate Eliminations Consolidated - Continuing Operations

8 unchanged sentences

(unaudited and in thousands, except per share data)

June 30, 2022

Expedited Freight Intermodal Corporate Eliminations Consolidated - Continuing Operations

As of June 30, 2022 $ 798,352 $ 300,035 $ 98,764 $ ( 8 ) $ 1,197,143

September 30, 2022

As of September 30, 2022 $ 698,313 $ 304,378 $ 183,409 $ ( 41 ) $ 1,186,059

As of December 31, 2021 777,987 249,467 90,588 ( 219 ) 1,117,823

A reconciliation from the segment information to the consolidated balances for revenues is set forth below:

Three Months Ended Six Months Ended

2022 June 30,

2021 June 30,

2022 June 30,

Three Months Ended Nine Months Ended

September 30,

2022 September 30,

2021 September 30,

2022 September 30,

Intersegment revenues - continuing operations $ — $ — $ — $ ( 57 )

1 unchanged sentence

Consolidated intersegment revenues $ — $ — $ — $ —

Revenue from the individual services within the Expedited Freight segment for the three and six months ended June 30, 2022 and 2021 are as follows:

Three Months Ended Six Months Ended

2022 June 30,

2021 June 30,

2022 June 30,

Revenue from the individual services within the Expedited Freight segment for the three and nine months ended September 30, 2022 and 2021 are as follows:

Three Months Ended Nine Months Ended

September 30,

2022 September 30,

2021 September 30,

2022 September 30,

Expedited Freight revenues:

5 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements