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TRUCKING INDUSTRY COMMENTS * USA -
* Companies’ quarterly financial reports reflect doldrums of industry
USA -The Trucker -10 Aug 2007: -- If you’ve seen one, you’ve seen them all — in terms of the financial reports from many of the publicly held carriers for the first half on 2007, that is. “Challenging freight environment,” “highly competitive market,” “softening rates”: the required statements typically take a long but precisely mapped route to say what will not be news to most drivers — too many trucks, not enough loads or miles... Revenues for many carriers were up, but more often than not increases were a product of acquisitions — big carriers gobbling up smaller ones — therefore adding expenses and, near term, reducing the bottom line. The extent of a company’s pre-buy of tractors ahead of this year’s new emissions regulations also played a big role in operating margins, whether in terms of paying for rigs that are mothballed, or for running more trucks and consequently getting less use out of the entire fleet... Margins were so slim that the difference between a comparatively good quarter or not so good often hinged on whether an accident or claim costs had been settled within that time period... So, without further ado, let’s let a sampling of carriers, and often the company bosses, speak for themselves...
* PHOENIX — Knight Transportation Inc. reported total revenue increased 8.7 percent, to $180.2 million from $165.8 million for the same quarter of 2006... “Our industry continued to experience a challenging freight environment during the second quarter, as industry capacity of truckload equipment outpaced freight demand, leading to pricing pressure and lower utilization,” Chairman and CEO Kevin P. Knight commented...
* MONDOVI, Wis. — Marten Transport Ltd. reported operating revenue, consisting of revenue from truckload and logistics operations, increased 5.3 percent to $138.8 million in the second quarter of 2007 from $131.9 million in the 2006 quarter... “The freight environment was challenging, which caused downward pressure on freight rates, fewer miles per tractor and increased non-revenue miles,” stated Chairman, President and CEO Randolph L. Marten...
* SAN MATEO, Calif. — Con-way Inc. reported operating income in the 2007 second quarter was $77.6 million, down 30.6 percent from $111.8 million earned in the second quarter a year ago... Commenting on the quarter, Con-way President and CEO Douglas W. Stotlar said, “The soft market for less-than-truckload freight remains highly competitive and price-sensitive, which has put pressure on yields. Given the market conditions we have been experiencing, we expect LTL freight demand to remain restrained through the remainder of 2007 leading to moderate year-over-year volume growth.”
* DULUTH, Ga — Saia Inc. reported second-quarter revenue was $253 million, an increase of 12 percent over the prior year... “Saia achieved solid top line revenue growth but did not achieve targeted margins. We believe this was primarily due to the soft shipping environment with costs further impacted by accident severity. In spite of reducing accident frequency versus the prior year quarter, this was a particularly difficult quarter for accident expense,” said Rick O’Dell, president and CEO...
* INDIANAPOLIS — Celadon Group Inc. reported revenue increased approximately 4 percent to $131.7 million in the 2007 quarter from $126.7 million in the 2006 quarter. “Despite a more challenging environment during the June 2007 quarter, we continued to execute on our business model of growth through acquisition, diversification of customer base, limiting exposure to any particular customer or industry and managing our overall cost structure. For the past three quarters, capacity has exceeded demand in the industry. We have used this situation as an opportunity to make a series of acquisitions,” Chairman and CEO Steve Russell explained.
* OMAHA, Neb. — Werner Enterprises Inc. reported revenue increased slightly to $531.3 million in second-quarter 2007 compared with $528.9 million in second-quarter 2006... “Over the same period that truckload freight rates have been depressed, inflationary and operational cost pressures have severely challenged truckload carriers. If this environment continues in the near term, it becomes more likely that trucking company failures will increase,” the company stated.
* FORT SMITH, Ark. — ABF Freight System Inc., the largest subsidiary of Arkansas Best Corp., had second-quarter 2007 revenue of $442.9 million, a per-day decrease of 5.1 percent from second-quarter 2006... "During this year’s second quarter, ABF effectively managed through a challenging environment with a softer, more competitive marketplace,” said Robert A. Davidson, Arkansas Best president and CEO.
* LOWELL, Ark. — J. B. Hunt Transport Services Inc. reported total operating revenue for the quarter was $856 million, a 2 percent increase from the $838 million for the second quarter 2006... “Thanks to healthy growth in volumes and higher prices in our Intermodal segment, we were able to withstand slower net growth in our Dedicated Contract Services segment, and stagnant freight volumes and lower prices in our Truck segment to produce a solid operating performance for the second quarter 2007,” said Kirk Thompson, JBHT president and CEO.
* OVERLAND PARK, Kan. — YRC Worldwide Inc. reported operating revenue of $2.5 billion compared to the second quarter of last year, at $2.6 billion, and adjusted operating income of $105 million compared with $177 million... “Our results continue to be impacted by a weak domestic shipping market resulting in a difficult operating environment,” stated Bill Zollars, chairman, president and CEO of YRC Worldwide. “National Transportation results compare favorably to overall industry performance even as we continue to face an economic headwind.”
Labels: trucking industry USA
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