Accounting Policies, by Policy (Policies) | 12 Months Ended |
Dec. 31, 2013 |
Accounting Policies, by Policy (Policies) [Line Items] | ' |
Consolidation, Policy [Policy Text Block] | ' |
Principles of Consolidation - The accompanying consolidated financial statements include Knight Transportation, Inc. and its wholly owned and controlled subsidiaries. The Company's non-controlling interests in subsidiaries are not significant. All intercompany accounts and transactions are eliminated upon consolidation. |
Use of Estimates, Policy [Policy Text Block] | ' |
Use of Estimates - The preparation of financial statements in conformity with United States Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Estimates and assumptions equally apply to the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents, Policy [Policy Text Block] | ' |
Cash and Cash Equivalents - Cash and cash equivalents are comprised of cash, money market funds, and short-term, highly liquid instruments with insignificant interest rate risk and original maturities of three months or less. Cash balances with institutions may be in excess of Federal Deposit Insurance Corporation ("FDIC") limits or may be invested in sweep accounts that are not insured by the institution, the FDIC or any other government agency. |
Finance, Loans and Leases Receivable, Policy [Policy Text Block] | ' |
Notes Receivable – The Company provides financing to independent contractors and third parties on equipment sold or leased under the Company's equipment sale program. Most of the notes are collateralized and are due in weekly installments, including principal and interest payments, ranging from 2.0% to 20%. The Company had 117 and 126 loans outstanding from independent contractors and third parties as of December 31, 2013 and 2012, respectively. |
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The notes receivable balances are classified separately between current and long-term notes in the consolidated balance sheets. The current and long-term balances of our notes receivables as of December 31, 2013 and 2012 are as follows: |
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| | 2013 | | | 2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (In thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Notes receivable from independent contractors | | $ | 503 | | | $ | 605 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Notes receivable from third parties | | | 4,630 | | | | 4,169 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gross notes receivable | | | 5,133 | | | | 4,774 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Allowance for doubtful notes receivable | | | (312 | ) | | | (291 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total notes receivable, net of allowance | | $ | 4,821 | | | $ | 4,483 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Current portion, net of allowance | | | 774 | | | | 791 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Long-term portion | | $ | 4,047 | | | $ | 3,692 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Disclosure of Long Lived Assets Held-for-sale [Table Text Block] | ' |
Assets Held for Sale - The Company had $16.5 million and $18.4 million of revenue equipment not being utilized in operations, which is classified as assets held for sale, as of December 31, 2013 and 2012, respectively. Assets held for sale are recorded at the lower of depreciated value or fair market value less selling costs and are not subject to depreciation. The Company periodically reviews the carrying value of these assets for possible impairment. No impairment was recorded in 2013 or 2012. The Company expects to sell these assets within 12 months. |
Inventory, Policy [Policy Text Block] | ' |
Other Current Assets - Included in other current assets are inventories of tires, spare parts, and fuel. |
Property, Plant and Equipment, Policy [Policy Text Block] | ' |
Property and Equipment - Property and equipment is stated at cost less accumulated depreciation. Property and equipment is depreciated to estimated salvage values using the straight-line method of depreciation over the following estimated useful lives: |
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| | Years | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Land improvements | | 5 | - | 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Buildings and improvements | | 15 | - | 30 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Furniture and fixtures | | 3 | - | 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Shop and service equipment | | 2 | - | 5 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenue equipment | | 5 | - | 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Leasehold improvements | | 1 | - | 5 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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The Company expenses repairs and maintenance as incurred. For the years ended December 31, 2013, 2012, and 2011, repairs and maintenance expense totaled approximately $30.5 million, $30.4 million, and $24.2 million, respectively. The expense is included in operations and maintenance expense in the accompanying consolidated statements of income. |
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The Company periodically reviews the reasonableness of its estimates regarding useful lives and salvage values for revenue equipment and other long-lived assets based upon, among other things, the Company's experience with similar assets, conditions in the used revenue equipment market, and prevailing industry practice. |
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Tires on revenue equipment purchased are capitalized as a part of the equipment cost and depreciated over the life of the vehicle. Replacement tires and recapping costs are expensed when placed in service. |
Investment, Policy [Policy Text Block] | ' |
Other Long-term Assets and Restricted Cash and Investments include: |
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| | 2013 | | | 2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (In thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Investment in Transportation Resource Partners (TRP) | | $ | 2,035 | | | $ | 2,246 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Investment in Transportation Resource Partners III (TRP III) | | | 11,440 | | | | 7,568 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Restricted Cash and Investments | | | 3,603 | | | | 3,947 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Available-For-Sale Equity Securities | | | 17,454 | | | | 6,369 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Other | | | 1,662 | | | | 1,253 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 36,194 | | | $ | 21,383 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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In 2003, the Company signed a partnership agreement with TRP, a company that makes privately negotiated equity investments. According to the original partnership agreement, the Company committed to invest $5.0 million out of approximately $260.0 million total, for a 1.9% ownership interest. In early 2006, the Company increased the commitment amount to $5.5 million. Contributions to TRP are accounted for using the cost method as the level of influence over the operations of TRP is minor. The Company contributed $142,000 to TRP as an additional investment in 2011, and no additional contributions were made in 2012 or 2013. The Company received additional earn-outs of $467,000, $216,000, and $115,000 in 2013, 2012, and 2011, respectively, for disposed portfolios. The earn-outs are recognized as gains in the year received. The Company also recorded a $209,000 impairment in 2013 for an other-than-temporary loss in its investment, resulting from unrealized losses on the investments remaining within the TRP portfolio. The Company's ownership interest in TRP is approximately 1.9%, with a carrying value of $2.0 million and $2.2 million at December 31, 2013 and 2012, respectively. |
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In the fourth quarter of 2008, the Company committed to invest $15.0 million in a new partnership managed and operated by the managers and principals of TRP. The new partnership, TRP III, focuses on the same investment opportunities as TRP. Since its inception, the Company has contributed approximately $10.8 million to TRP III, leaving an outstanding commitment of $4.2 million as of December 31, 2013. The investment in TRP III is accounted for using the equity method. The Company has recorded income of approximately $669,000, $261,000, and $74,000 for its investment in TRP III for years ended December 31, 2013, 2012, and 2011, respectively. At December 31, 2013, the investment balance in TRP III was $11.4 million, compared to $7.6 million at December 31, 2012. The Company's ownership interest was approximately 6.1% as at December 31, 2013. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | ' |
Restricted Cash and Investments – In connection with the Company's self-insurance program, $3.6 million and $3.9 million have been set aside in escrow accounts to meet statutory requirements as of December 31, 2013 and 2012, respectively. |
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In accordance with the provisions of ASC 210, Balance Sheet, and ASC 320, Investments – Debt and Equity Securities, the Company's investments in debt or equity securities are classified as either trading securities, held-to-maturity securities, or available-for-sale securities, based on the Company's intent with respect to those securities. Investments in debt and equity securities are classified as trading securities if they are held principally for the purpose of selling in the near term. Investments in debt securities are classified as held-to-maturity if the Company has the positive intent to hold such securities to maturity and the ability to do so. Investments in debt and equity securities not classified as trading or held-to-maturity are classified as available-for-sale. |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | ' |
Impairment of Long-Lived Assets – ASC 360-10, Property, Plant and Equipment, provides a single accounting model for the assessment of impairment of long-lived assets. In accordance with ASC 360-10, Long-lived Assets, such as property and equipment and purchased intangibles to be held and used in operations, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Long-lived assets are grouped at the lowest level at which identifiable cash flows are largely independent when assessing impairment. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets classified as held for sale are not depreciated and are presented in the Company's consolidated balance sheets at the lower of the carrying amount or fair value less costs to sell. Revenue equipment classified as held for sale is presented in "assets held for sale" on the Company's consolidated balance sheets. Recoverability of long-lived assets is dependent upon, among other things, the Company's ability to continue to achieve profitability in order to meet its obligations when they become due. In the opinion of management, based upon current information, the carrying amount of long-lived assets will be recovered by future cash flows generated through the use of such assets over their respective estimated useful lives. |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | ' |
Goodwill & Intangibles, net - Goodwill is not amortized, but it is reviewed for impairment at least annually (December 31), or more frequently should any of the circumstances listed in ASC 350-20, Goodwill, occur. The standard permits an entity to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. However, if an entity concludes otherwise, then it is required to perform the impairment test as prescribed in ASC 350-20. Goodwill is required to be tested for impairment at the reporting unit level utilizing a two-step methodology. The initial step requires the Company to determine the fair value of the reporting unit and compare it to the carrying value of such unit, including goodwill. No impairment is recognized if the fair value exceeds the carrying value; however, if the carrying value of the reporting unit exceeds its fair value, the goodwill of the reporting unit may be impaired. The amount, if any, of the impairment would then be measured in the second step. The Company completed this annual test as of December 31, 2013, and no adjustment for impairment was determined to be necessary. The Company has no accumulated goodwill impairment loss from prior years. |
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During fiscal year 2006, the Company recorded approximately $1.8 million of goodwill and $310,000 of finite lived intangible assets in connection with the acquisition of most of the trucking assets of Roads West. In 2007, the Company paid Roads West $135,000 for an earn-out, representing the final earn-out under the purchase agreement. The earn-out paid in 2007 was recorded as additional goodwill related to this acquisition. The basis of goodwill for tax purposes was determined to be in excess of the book basis of goodwill. Under this circumstance, ASC 740, Income Taxes, requires that the goodwill be separated into two components for the acquisitions before the adoption of ASC 805, Business Combination. The first component is equivalent to book goodwill, and future tax amortization of this component is treated as a temporary difference, for which a deferred tax liability is established. The second component is the excess tax goodwill over the book goodwill, for which no deferred taxes are recognized. The tax benefit from the recognition of the amortization of the second component on the tax return is treated as a reduction in the book basis of goodwill. The finite lived intangible portion was amortized using the straight-line method over a five-year period, and was fully amortized as of December 31, 2011. |
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The changes in the carrying amounts of goodwill were as follows: |
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| | 2013 | | | 2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (In thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Goodwill at beginning of period | | $ | 10,276 | | | $ | 10,295 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amortization relating to deferred tax assets | | | (19 | ) | | | (19 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Goodwill at end of period | | $ | 10,257 | | | $ | 10,276 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Claims Accrual Policy Text Block | ' |
Claims Accrual - The claims reserves represent accruals for estimated pending claims within the self-insured retention ("SIR"), including adverse development of known claims and incurred but not reported claims. These estimates are based on the Company's claims experience, including claims settlement patterns, historical payment trends, the experience/knowledge of the Company's self-administered claims as well as that of the third-party administrator as it relates to workers' compensation claims, along with assumptions about future events. The most significant assumptions used in the estimation process include determining the trend in costs, the expected cost of claims incurred but not reported, and the expected costs to settle or pay outstanding claims. Changes in assumptions and changes in actual experience could cause these estimates to change significantly in the near term. A higher SIR may cause assumptions and estimates to vary more unpredictably than a lower SIR. |
Revenue Recognition, Policy [Policy Text Block] | ' |
Revenue Recognition - The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. These conditions are met upon delivery. |
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In accordance with ASC 605-45, Revenue Recognition – Principal Agent Consideration, the Company accounts for revenue from our Asset-Based operations, our Non-Asset-Based operations, and revenue on freight transported by independent contractors on a gross basis. The Company is the primary obligor in the arrangements, the Company has the ability to establish prices, the Company has discretion in selecting the independent contractor or other third-party that will perform the service, the Company has the risk of loss in the event of cargo claims, and the Company bears credit risk with customer payments. Accordingly, all such revenue billed to customers is classified as operating revenue and all corresponding payments to carriers for transportation services the Company arranges in connection with Brokerage and Intermodal activities and to independent contractor providers of revenue equipment are classified as purchased transportation expense. |
Income Tax, Policy [Policy Text Block] | ' |
Income Taxes - The Company accounts for income taxes under the asset and liability method. This method requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized as income in the period that includes the enactment date. |
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The Company records a valuation allowance for deferred tax assets to the extent it believes these assets are not more likely than not to be realized. In making such determinations, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and recent financial operations. A valuation allowance for deferred tax assets has not been deemed necessary due to the Company's profitable operations. |
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The Company recognizes a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | ' |
Financial Instruments- The Company's financial instruments include cash equivalents, investments held for trading, available-for-sale securities, trade receivables, notes receivable, accounts payable, and long-term debt. Due to the short-term nature of cash equivalents, trade receivables, and accounts payable, the fair value of these instruments approximates their recorded value. Available-for-sale and trading securities consist of marketable equity and debt securities stated at fair value. Due to the variable interest rate, the fair value of long-term debt approximates fair value. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | ' |
Concentration of Credit Risk - Financial instruments that potentially subject the Company to credit risk consist principally of trade receivables and notes receivable. Revenue for the Company's three largest customers accounted for approximately 11%, 10% and 12% of the total revenue for the years ended 2013, 2012 and 2011, respectively. As of December 31, 2013, balances due from the three largest customers account for approximately 6.5% of the total trade receivable balance, compared to 7.7% as of December 31, 2012. Revenue from the Company's single largest customer represented approximately 4% of total revenue for the years ended December 31, 2013 and 2012, and approximately 5% for the year ended 2011. The balance due from the single largest customer accounts for approximately 1.2% of the total trade receivable balance as of December 31, 2013, compared to 1.3% as of December 31, 2012. |
Earnings Per Share, Policy [Policy Text Block] | ' |
Earnings Per Share - A reconciliation of the numerator (net income) and denominator (weighted average number of shares outstanding) of the basic and diluted earnings per share ("EPS") computations for 2013, 2012, and 2011 are as follows (in thousands, except per share data): |
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| | 2013 | | | 2012 | | | 2011 | |
| | Net Income | | | Shares | | | Per Share | | | Net Income | | | Shares | | | Per Share | | | Net Income | | | Shares | | | Per Share | |
(numerator) | (denominator) | Amount | (numerator) | (denominator) | Amount | (numerator) | (denominator) | Amount |
Basic EPS | | $ | 69,282 | | | | 79,994 | | | $ | 0.87 | | | $ | 64,117 | | | | 79,673 | | | $ | 0.8 | | | $ | 60,248 | | | | 81,439 | | | $ | 0.74 | |
Effect of stock options & restricted stock | | | - | | | | 336 | | | | | | | | - | | | | 327 | | | | | | | | - | | | | 433 | | | | | |
Diluted EPS | | $ | 69,282 | | | | 80,330 | | | $ | 0.86 | | | $ | 64,117 | | | | 80,000 | | | $ | 0.8 | | | $ | 60,248 | | | | 81,872 | | | $ | 0.74 | |
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Certain shares of common stock were excluded in the computation of diluted earnings per share because the options' exercise prices were greater than the average market price of the common shares, and therefore, the effect would be anti-dilutive. A summary of those options for the twelve months ended December 31, 2013, 2012, and 2011, respectively, is as follows: |
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| | 2013 | | | 2012 | | | 2011 | | | | | | | | | | | | | | | | | | | | | | | | | |
Number of anti-dilutive shares | | | 1,917,020 | | | | 1,926,298 | | | | 2,655,814 | | | | | | | | | | | | | | | | | | | | | | | | | |
New Accounting Pronouncements, Policy [Policy Text Block] | ' |
New Accounting Pronouncements |
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In December 2013, the FASB issued ASU No. 2013-12, Definition of a Public Entity. This ASU intends to improve U.S. GAAP by providing a single definition of public business entity for use in future financial accounting and reporting guidance. The amended definition specifies that an entity that is required by the SEC to file or furnish financial statements with the SEC, or does file or furnish financial statements with the SEC, is considered a public business entity. The definition also addressed consolidated subsidiaries of public companies, stating that such an entity is not considered a public business entity for purposes of its stand-alone financial statements other than those included in an SEC filing by its parent or by other registrants or those that are issuers and are required to file or furnish financial statements with the SEC. There is no actual effective date for the amendment, however the term public business entity will be used in certain ASU's going forward. |
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In February 2013, the FASB issued ASU No. 2013-02, Other Comprehensive Income. This ASU intends to improve the reporting of reclassifications out of accumulated other comprehensive income by requiring an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income. For other amounts that are not required under GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP that provide additional detail about those amounts. The new guidance is effective for fiscal years beginning after December 15, 2012. The amendments do not change the current requirements for reporting net income or other comprehensive income in financial statements and the adoption of this guidance did not have a material impact on the Company's consolidated financial statements. |
Allowance for Doubtful Accounts [Member] | ' |
Accounting Policies, by Policy (Policies) [Line Items] | ' |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | ' |
Allowance for Doubtful Accounts - Revenue is recognized when freight is delivered, creating a credit sale and an account receivable. Credit terms for customer accounts are typically on a net 30 day basis. The Company establishes an allowance for doubtful accounts based on historical experience and any known trends or uncertainties related to customer billing and account collectability. The Company reviews the adequacy of its allowance for doubtful accounts on a quarterly basis. Uncollectible accounts are written off when deemed uncollectible, and accounts receivable are presented net of an allowance for doubtful accounts. Historically, the Company has not had significant losses related to uncollectible accounts. |
Allowance for Notes Receivable [Member] | ' |
Accounting Policies, by Policy (Policies) [Line Items] | ' |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | ' |
Allowance for Doubtful Notes Receivable - The Company evaluates the collectability of notes and finance lease receivables on a customer-by-customer basis. The Company establishes an allowance for credit losses based on specific customer circumstances, payment patterns, credit risk changes, and historical loss experience. The Company reviews the adequacy of its allowance for doubtful notes receivable quarterly. Uncollectible accounts are written off when deemed uncollectible, and notes receivable are presented net of an allowance for doubtful accounts. Historically, the Company has not had significant losses related to uncollectible accounts. |