LTLs’ 4Q Results Improve Despite Winter Storms
This story appears in the Feb. 10 print edition of Transport Topics.
Three publicly traded less-than-truckload operators reported improved fourth-quarter earnings despite challenges such as severe weather, but profit slipped at a fourth fleet on higher insurance costs.
Old Dominion Freight Line Inc. said Feb. 6 that net income improved 19% to $47.2 million, and Saia Inc. said earnings rose more than 50% to $8.1 million. In addition, Con-way Inc.’s LTL unit increased profit before interest and taxes by 11% to $23.8 million.
Roadrunner Transportation Systems’ profit before interest and taxes slipped 21% to $5.2 million, hurt by insurance expense, weather and operational inefficiencies as newly opened terminals tried to build volume.
The overall tone of improved results was consistent with higher profit at ABF Freight System, which on Jan. 30 reported $9.9 million net income, reversing a fourth-quarter 2012 loss.
Con-way’s less-than-truckload unit, the largest of its reporting companies, improved revenue 2.7% to $847 million. Tonnage growth of 1% was held down by bad weather, the company said. Revenue per 100 pounds of freight rose 0.9%.
CEO David Congdon said, “Old Dominion’s fourth quarter of 2013 includes a significant increase in our benefit costs, as compared to the prior-year period, due primarily to increased costs for our group health and workers’ compensation plans.”
Congdon also cited severe weather that hurt results. Old Dominion increased tonnage per day 11%, but revenue per 100 pounds of freight fell 0.3%.
Total revenue rose 11% to $592.5 million, the company said. Year-earlier net income was $39.5 million, or 46 cents per share.
Roadrunner’s LTL revenue rose 4.4% to $135.5 million, tied to a 5.3% rise in tonnage.
Mark DiBlasi, CEO of Roadrunner, said on a conference call that business should improve, eventually.
“We still grew [in January LTL] in the face of very tough weather conditions,” he said. “I’m optimistic that the shipper base out there is going to grow this year, which will then translate into tightening capacity, which will then translate into more freight in a better pricing environment.”
CEO Richard O’Dell was positive as well, saying, “Saia ended the year with improving tonnage trends, and we believe we are well positioned to grow our market share, going forward.”
Saia’s net income rose to 33 cents per share from $5.4 million, or 22 cents.
Revenue increased 5.8% to $279.7 million.
Improvement was reported in LTL tonnage (2.9%), shipments (1.7%) and revenue per 100 pounds of freight (2.3%).
Weaker results in its logistics unit led to a 0.9% decline at Con-way Inc. in fourth-quarter net income to $11.7 million, or 20 cents per share, compared with profit of $11.8 million, or 21 cents.
Earnings at Con-way’s Menlo Logistics unit before interest and taxes fell almost 70% to $2.72 million, hurt by startup costs for new customers. Con-way’s overall revenue totaled $1.36 billion in both periods.
On the truckload side, Con-way Truckload raised profit before interest and taxes by 5% to $8.9 million, though revenue climbed less than 1% to $155.8 million.
Profit also improved on that basis at Roadrunner’s truckload unit, rising 11% to $11.5 million. However, Roadrunner’s truckload margins dipped as revenue increased 37% to $180.1 million.
Roadrunner’s net income rose 18% to $11.2 million, or 29 cents per share, from $9.5 million, or 29 cents. The company’s share count increased over the past year. Revenue rose 24% to
$367 million.
Con-way ranks No. 3 on the Transport Topics Top 100 list of the largest for-hire carriers in the United States and Canada, and Old Dominion ranks No. 11. Arkansas Best Corp., parent of ABF Freight System, ranks No. 12, while Saia ranks No. 22 and Roadrunner ranks No. 24.
