TFI International Inc. (TFII) Cash Flow Statement

The persistent gap between operating cash flow and net income, which reached 3.94x in 2025Q4, suggests that non-cash charges like depreciation and amortization are substantial, and working capital changes are not eroding cash generation. This implies that reported earnings understate the company's cash-generating ability, a positive signal for debt servicing and capital allocation. However, the 2026Q1 dip in OCF/NI to 2.81x, alongside a sharp earnings decline, warrants monitoring for potential earnings quality deterioration.

The FCF trajectory is highly volatile, with margins ranging from 4.8% to 10.5% over the past ten quarters, indicating sensitivity to revenue fluctuations and capex timing. The 2026Q1 FCF margin of 4.8% is the lowest in the period, aligning with the income statement's operating margin collapse, suggesting that the company's cash generation is cyclical and may face further pressure if freight demand remains soft. Investors should monitor whether FCF can recover to the 8-10% range seen in mid-2025, as that would signal a return to normalized cash generation.

The capex-to-revenue ratio has been relatively stable, ranging from 1.3% to 5.7%, with the higher figures in 2024 likely reflecting fleet investments following the TForce Freight acquisition. The low capex intensity relative to peers like ODFL (which typically runs higher) suggests TFII may be under-investing in its network, potentially limiting long-term service quality. However, the company's heavy use of independent contractors reduces the need for owned equipment, making the reported capex a less complete measure of capital intensity.

The volatility in working capital changes, which swung from positive to negative across quarters, suggests that TFII's cash conversion cycle is not stable, possibly due to acquisition integration and changing payment terms. The 2026Q1 use of cash for working capital, despite a revenue decline, may indicate slower collections or inventory build-up, which could pressure near-term cash flow. This pattern warrants close monitoring, as persistent working capital outflows could signal deteriorating efficiency in a softening freight environment.

The cash flow statement reveals that acquisition spending, including the $781.9M outflow in 2024Q2, dwarfs shareholder returns, underscoring management's roll-up strategy. Despite this, the company has maintained a consistent dividend and opportunistically repurchased shares, with buybacks peaking at $86.5M in 2025Q2. The elevated acquisition activity has likely contributed to the balance sheet strain, as evidenced by the 1.38 debt-to-equity ratio, and may limit future capital flexibility if integration costs escalate.

The large cumulative gap between operating cash flow and net income is primarily attributable to non-cash charges like depreciation and amortization, which totaled over $1.5B in the period. This suggests that TFII's asset base is substantial and that reported earnings are conservative, but it also raises questions about the sustainability of cash generation if the company's assets become less productive. The divergence is a positive signal for debt repayment capacity, but investors should be aware that a portion of this cash flow may be needed for mandatory debt amortization or fleet replacement.