Fleet Financials
Earnings up, capacity is squeezed by lack of drivers.
Patricia Smith
Senior Editor
Economic recovery — plus what appears to be a lingering capacity squeeze — brought higher first quarter revenues and profits for most of the country's publicly held carriers. Severe weather in some areas hampered freight movement but most carriers said that things began to pick-up as we moved into spring.
After only a few months with the new hours of service rules, nobody was ready to gauge the impact on productivity or financial performance. Some fleets noted reductions in equipment utilization, but higher accessorial charges helped soothe the sting.
Fuel costs remain a concern. Robert Powell, chairman and CEO of USA Truck, said they recovered about 84% of higher fuel costs through fuel surcharges, but customers don't pay for empty and out-of-route miles.
However, the biggest challenge is getting and keeping drivers. Several carriers said pay raises helped them fill empty seats, but the shortage of new drivers coming into the industry could seriously hamper growth.
J.B. Hunt said a "far-reaching, universal solution to this shortage of labor" is needed, and until that has been found "it is our view that the industry's supply of trucks will remain constrained."
For the time being anyway, that means shippers will be paying more. "We expect the rate environment will continue to remain strong for the foreseeable future," said Michael Paxton, chairman, president and CEO of Transport Corp. of America. "Improving economic conditions and limited driver availability will continue to put pressure on truckload capacity."
Arkansas Best
ABF Freight System's first quarter revenues were $346.1 million, up from $330.8 million first quarter 2003. Operating income was $8.7 million versus $11.1 million. Operating ratio was 97.5% versus 96.6%. LTL revenue per hundredweight, excluding fuel surcharges, was $23.47, up 2% from a year ago. Arkansas Best's Clipper operation had first quarter revenues of $10.9 million. Clipper first quarter 2003 revenues were $19.8 million. Intermodal revenues were up 13.3%, offsetting declines in temperature-controlled, brokerage and other units. Clipper's operating ratio was 102.8% versus 100.6% a year ago, excluding LTL.
CNF
CNF reported first quarter income of $24.4 million, up 53% from first quarter 2003. Revenues were $1.35 billion, up 12%. Operating income was $52.7 million, up 28%. Con-Way Transportation Services' revenues were $593.8 million, up 14%. Operating income was $51.1 million, up 37%. Regional carrier weight per day was up 11%. Menlo Worldwide Logistics had revenues of $252.8 million, up 5%, and operating income of $6.5 million, up 8%. Menlo Worldwide forwarding had revenues of $501.5 million, up 13%, and an operating loss of $6.4 million, compared with a $5.4 million loss a year ago, which included a $7.2 million one-time gain. CNF's other operations — including Road Systems — lost $852,000 in the quarter.
Old Dominion
Old Dominion first quarter operating revenues were $182.8 million, up 19.6% from a year ago. Net income was $5.7 million, up 34.5%. Operating ratio was 94% versus 94.3%, the tenth consecutive comparable-quarter improvement. Revenue per hundredweight was $14.44 versus $14.42. Revenue per LTL shipment was $150.32 versus $147.49.
Overnite
Overnite reported first quarter operating revenues of $378.5 million, up 10.9% from a year ago. Net income was $7.5 million, compared to a pro forma net income of $5.6 million. Operating income was $14 million, up 30.2%. Operating ratio was 96.3% versus 96.9%. Revenue per LTL hundredweight, excluding fuel surcharges, was $14.54 versus $14.88. Overnite was spun off from Union Pacific Corp. in November 2003.
SCS Transportation
SCS consolidated revenues for first quarter totaled $225.3 million, up 12.6%. Net income was $2.6 million, compared to $1.3 million a year earlier. Operating income was $6.8 million versus $4.5 million. Results included integration charges and income generated by Clark Bros. Transfer, acquired in February.
SCS's Saia division had revenues of $142.8 million, up 15.5% from a year earlier. Operating income was $6.1 million, up 41.7%. Excluding one-time charges, Saia's first quarter operating ratio was 95% versus 96.5%. LTL revenue per hundredweight was down 0.9%; revenue per LTL shipment was up 2.1%. Jevic revenues were $82.5 million, up 7.8%. Operating income was $1.9 million, up 70.3%. Operating ratio was 97.7% versus 98.6%. LTL revenue per hundredweight was up 3.4%. LTL revenue per shipment was up 6.1%. Truckload revenue per shipment was up 1.9%.
USF Corp.
USF reported first quarter income from continuing operations of $7.1 million, a 69% increase from a year earlier. Revenues totaled $617 million, up 3.9%. LTL revenues totaled $520 million, up 6.3%. That included a 6.6% increase in USF Holland revenues, a 10% increase for USF Reddaway and a 16% increase for PremierPlus, USF's inter-regional product. LTL operating earnings were $24 million, up 43%. Revenue per hundredweight was $11.16, down 1%. Revenue per shipment was $130.50, up 2.1%.
USF's truckload carrier revenues were $34.3 million, up 8%. Operating earnings were $800,000, up 55%. Operating ratio was 97.6% versus 98.4%. Logistics revenues were $66.4 million, down 12.2%. Logistics operating profit was $1.6 million versus $600,000 a year ago.
Yellow Roadway Corp.
Yellow Roadway combined first quarter revenues were $1.55 billion, up 7.7% from pro forma first quarter 2003. Operating income was $41.3 million, up 20.3%.
Yellow Transportation posted a record first quarter with revenues of $734 million, up 11.3% from a year ago. LTL revenue per day was up 9.2%, LTL tonnage per day was up 6.6%, LTL revenue per hundredweight, up 2.8%. Adjusted operating income was $26.9 million, up 37.8%. Adjusted operating ratio was 96.3% versus 97%.
Roadway Express revenues were $717 million, up 1%. LTL revenue per day was down 1.8%, LTL tonnage per day was down 3%, LTL revenue per hundredweight, excluding fuel surcharges, was up 1.4%. The company noted that comparisons were difficult because of the temporary boost in business volumes and shipment characteristics due to the Consolidated Freightways shutdown. Adjusted operating ratio was 97.9% versus 97.1%.
Yellow Roadway's New Penn Motor Express had revenues of $56.1 million, up 10.8%. LTL tonnage per day was up 7.6%. Revenue per hundredweight, excluding fuel surcharges, was down 0.2%. Adjusted operating income was $5.7 million versus $1.7 million a year ago. Adjusted operating ratio was 89.8% versus 96.5%. Meridian IQ revenues were $45.7 million versus $22.1 million. Operating income was $600,000 versus a $900,000 loss last year.
Boyd Bros. Transportation
Boyd Bros. had first quarter operating revenues, including fuel surcharges, of $34.6 million, up 6% from first quarter 2003. Pre-tax income was $647,633 compared with $6,850. Net income was $383,967 versus $4,185. Both its Boyd division, which primarily uses owner-operators, and its WTI division, which uses owner-operators, reported higher revenues for the quarter.
Covenant Transport
Covenant reported first quarter freight revenues, excluding fuel surcharges, of $130.6 million versus $130.4 million. Net income was $721,000 versus $839,000. Revenue per loaded mile, excluding fuel surcharges, was $1.318, up 5.3% from a year ago. Average revenue per tractor per week was $2,749 versus $2,712. At the end of the quarter Covenant had 3,589 tractors in its fleet, versus 3,717 a year earlier. Average age was 1.5 years versus 2.2 years. The number of trailers went from 7,516 to 9,048. Average age was 2.4 years versus 4.6 years.
Celadon Group
Celadon reported net income of $1.4 million on revenues of $98.9 million for its third fiscal quarter ending June 30. For the same period in 2003, net income was $500,000 on revenues of $90.7 million. Operating ratio was 96% versus 97.8%. Average revenue per loaded mile was $1.332 versus $1.275. Average revenue per tractor per week, excluding fuel surcharges, was $2,696, up 7.4%.
At the end of the quarter Celadon had 2,798 tractors and 7,498 trailers in service, including owner-operator tractors and equipment supplied by its Mexican subsidiary. A year ago the fleet was 2,559 tractors and 7,139 trailers. Average age of the tractor fleet was 2.3 years versus 2.75 years. Celadon's TruckersB2B had revenues of $1.6 million compared to $1.4 million a year ago. Operating income was $300,000 versus $200,000.
Heartland Express
Heartland first quarter revenues were $106.8 million, up 12.6% from a year ago; net income was $13.1 million, up 18.7%. Operating ratio was 81.5% versus 82.9%.
J.B. Hunt Transport Services
J.B. Hunt had record first quarter net earnings of $33 million, compared to $11 million last year. Revenues totaled $618 million versus $571 million. Truck segment revenues, excluding fuel surcharges, totaled $210 million versus $199.5 million. Operating income was $14.7 million versus $1.3 million. Operating ratio for the truck segment was 93% versus 99.3%. Revenue per tractor per week, excluding fuel surcharges, was $2,765 versus $2,575. Revenue per loaded mile was $1.552 versus $1.460. Empty mile factor was 9.6% versus 9.5%. At the end of the quarter the Truck segment fleet included 4,429 company owned tractors, 1,009 owner-operator tractors, and 20,035 trailers. That compares with 4,795 company owned tractors, 798 owner-operator tractors and 20,002 trailers a year ago.
Intermodal revenues were $242.2 million versus $214.6 million. Operating income was $29.1 million versus $18.9 million. Operating ratio was 88% versus 91.2%. Revenue per load, excluding fuel surcharges, was $1,707, about the same as a year ago. There were 1,041 tractors and 21,226 containers in the intermodal fleet, compared with 931 tractors and 19,659 containers the year before.
Revenues from Hunt's Dedicated segment totaled $169.6 million versus $161.6 million. Operating income was $14.3 million versus $3.7 million. Operating ratio was 91.6% versus 97.7%. Revenue per tractor per week was $2,730 versus $2,560. At the end of the quarter the dedicated fleet was 4,714 tractors, including 303 independent contractor and customer-owned units, and 5,708 trailers. That compares to 4,696 tractors, including 144 customer-owned units, and 5,853 trailers a year earlier.
Knight Transportation
Knight posted record first quarter revenues, before fuel surcharges, of $90.2 million, up 22.7% from a year earlier. Net income was $9.3 million, up 31.6%. Operating ratio was 82.9% versus 83.9%. Average revenue per loaded mile was $1.489, up 4.1%. Empty mile factor was 11.8% versus 11.1%. At quarter's end the fleet included 2,228 company tractors and 249 owner-operator units, compared with 1,956 company tractors and 212 owner-operator tractors a year ago. It had 6,334 trailers, up from 5,612.
Landstar System
Landstar reported record $421 million revenues for the first quarter, up 15% from a year ago. Net income was $8.1 million, which included $7.6 million in settlement costs related to a severe accident that occurred at the beginning of the year. Net income for first quarter 2003 was $10.2 million. Costs related to the accident settlement reduced Landstar's operating margin by 1.8% to 3.3% for first quarter. Operating margin for the same period a year ago was 4.7%.
Landstar's carrier group of companies had revenues, excluding fuel surcharges, of $321.6 million compared to $290 million first quarter last year. Operating income was $23.7 million versus $18.5 million. Revenue per loaded mile was $1.75 versus $1.74. The multimodal segment had revenues of $92 million, compared to $68.7 million. Operating income was $2.7 million versus $1.9 million. At the end of the quarter Landstar had 7,637 business capacity owners, up from 7,272 a year ago, and 15,905 approved third-party truck capacity providers versus 14,509 a year earlier.
Marten Transport
Marten reported fourth quarter net income of $2.7 million, up 95.6% from the same period in 2003. Revenues were $84.5 million, up 6.6%. Excluding fuel surcharges, freight revenues were up 7.2%. Operating ratio was 94.6% versus 96.7%. Average freight revenue per total mile was $1.26 versus $1.21. Average freight revenue per tractor per week was $2,845 versus $2,716. Non-revenue mile factor was 6.6% versus 6.8%. At the end of the quarter the fleet was 2,181 tractors, including 574 owner-operators, and 2,960 trailers. A year ago the fleet was 2,116 tractors, including 596 owner-operators, and 2,769 trailers.
P.A.M. Transportation Services
P.A.M. reported first quarter net income of $2 million on revenues of $77.7 million, compared with $2.8 million on $70.1 million a year earlier. Income from truckload operations was $544,455 versus $347,779. Revenue per mile was $1.10 versus $1.09. Empty mile factor was 4.75% versus 3.93%. Revenue per truck per work day was $561 versus $563. The fleet averaged 1,773 company trucks during the quarter and 99 owner-operator trucks, compared with 1,628 company and 129 owner-operator trucks a year ago.
Patriot Transportation Holding
Patriot reported transportation revenues of $24.3 million for its second fiscal quarter, compared with $21.3 million a year ago. Transportation operating profit was $1.1 million versus $323,000. Miles hauled were up 12.8%. Flatbed miles were up 19.7%, tankline miles up 9.3%. Total Patriot revenues, including real estate activities, were $28.6 million versus $25.1 million. Net income was $7 million versus $622,000. Income from continuing operations was $1.3 million.
Smithway Motor Xpress
Smithway posted first quarter operating revenues of $43.6 million, up 9.3% from first quarter 2003. Net earnings were $335,000, including $727,000 of tax-free life insurance proceeds. Without that, the company had a net loss for the quarter of $392,000 versus a $1.6 million net loss for the same period last year. Operating ratio was 100.4%, compared with 105.1%. Average revenue per loaded mile was $1.40 versus $1.34. Average revenue per tractor per week, excluding fuel surcharges, $2,601 versus $2,169. At the end of the quarter the fleet included 748 company owned tractors and 434 owner-operator tractors, compared with 771 company owned and 515 owner-operator tractors a year ago. The number of trailers went from 2,434 to 2,236.
Swift Transportation
Swift first quarter revenues, including Merit Distribution Services, were $622.4 million, up 12.9%. Net earnings including one-time charges were $6.4 million, compared to $8.9 million. Operating income was $14.6 million, up 2.4%. Trucking revenues were $581.2 million versus $508.9 million. Revenue per loaded mile was $1.4987 versus $1.4244. Revenue per tractor per day was $536 versus $522. Deadhead factor was 13.2% versus 13.77%. At the end of the quarter Swift had 14,558 company owned linehaul tractors and 3,759 owner-operator tractors, compared with 12,806 company tractors and 3,200 owner-operators a year ago.
Transport Corp. of America
Transport America's first quarter freight revenues before fuel surcharges were $59.2 million, compared to $63.6 million a year ago. Net earnings were $71,000 versus a $518,000 loss first quarter 2003. Operating ratio was 98.5% versus 99.5%. Revenue per loaded mile, excluding fuel surcharges, was $1.473 versus $1.388. Revenue per tractor per week was $2,797 versus $2,688. Empty mile factor was 10.6% versus 10%. Tractors at the end of the quarter totaled 1,682, including 678 owner-operators. Total at the end of third quarter 2003 was 1,885, including 865 owner-operators.
USA Truck
USA Truck reported record quarterly operating revenues of $79.5 million before fuel surcharges, up 21% from first quarter 2003. Operating income was $3 million versus a $543,000 loss a year ago. Net income was $997,000 versus a $97,000 loss. Operating ratio was 96.2% versus 100.8%. Revenue per mile, before fuel surcharges, was $1.276 versus $1.214. Empty mile factor was 8.71% versus 9.17%. Average number of tractors in the fleet during first quarter was 2,102, compared with 1,898 a year ago.
U.S. Xpress Enterprises
U.S. Xpress had first quarter operating revenues of $234.7 million, up 6.3% from the same period in 2003. Net income was $800,000, compared to $121,000. Consolidated operating income was $3.2 million, up 13.4%. Operating ratio was 98.4% versus 98.5%. Truckload segment operating income was $3.4 million, up 10.6%. Revenue per mile, excluding fuel charges, was $1.352 versus $1.275. Average revenue per tractor for the quarter was $35,923 versus $34,002. Empty mile factor was 10.37 versus 10.33. At the end of the period total tractor in the fleet was 5,509 versus 5,576 a year ago. Xpress Global Systems had operating income of $230,000 versus $126,000 third quarter 2003.
Werner Enterprises
Werner first quarter operating revenues were $386.3 million, up 11% from a year earlier. Net income was $15.6 million, up 31%. The company says this is its tenth consecutive year-over-year quarter of higher revenues and earnings. Trucking revenues, excluding fuel surcharges, were $329.7 million, up 7.6%. Average revenue per loaded mile was $1.47 versus $1.395. Average revenue per truck per week was $3,007 versus $2,852. At the end of the quarter the fleet included 7,495 company tractors, 930 owner-operator tractors and 22,960 trailers, compared to 7,275 company tractors, 1,000 owner-operators, and 21,040 trailers. Trucks in dedicated service now account for almost one-third of Werner's total truck fleet versus one-fourth a year ago. The company said the dedicated fleet has grown by 850 units, which was offset by a reduction in the medium-to-long haul van fleet.
Ryder System
Ryder's consolidated earnings were $35 million in the first quarter, up 67% from a year ago. Revenues were $1.21 billion, up 1.5%. Its Fleet Management Solutions unit had revenues of $663.1 million, excluding fuel, up 4% from first quarter last year. Full service lease and programmed maintenance revenues were up 4%, commercial rental revenues were up 16%. Pre-tax income was $54.7 million, up 69%.
Ryder Supply Chain Solutions had revenues of $321.1 million, down 4%. Pre-tax earnings were $231.4 million, up slightly from last year. Dedicated Contract Carriage revenues were $124.6 million, down 2%; pre-tax earnings were $7.2 million versus $7.8 million.
