P.A.M. Posts Higher Second Quarter Net Income
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P.A.M. Transportation Services Inc. reported higher net income and a dip in revenue in the second quarter amid improved operating ratios in its divisions.
For the period ended June 30, net income increased to $8.6 million, or $1.45 per diluted share, compared with $7.2 million, or $1.17, a year earlier.
Revenue, before fuel surcharge, decreased 0.5% to $112.3 million compared with $112.8 million for the second quarter of 2018.
“It’s been said that 2019 has been a bad year in terms of freight demand, but this has not been our experience. While demand has not been as strong as comparative periods in 2018, it has been much better for us than 2016 and 2017 when we last experienced downward rate pressure,” Daniel Cushman, president of the truckload carrier, said in a company release.
He said Mexico continues to be an opportunity for growth and P.A.M. continues to grow its dedicated business.
“[In Mexico] northbound demand currently exceeds our asset availability, so we are growing through various alternative capacity offerings, including brokerage and in our B1 [visa] driver solution. Some of our success in growing dedicated business has come from an automotive customer with which we recently secured a significant piece of business for a three-year term,” Cushman said.
The operating ratio in its truckload division improved to 87.06 compared with 90.26 a year earlier. Revenue per total mile before fuel surcharges improved to $1.71 compared with $1.56 a year earlier.
Average company-owned trucks in the quarter increased to 1,520 from 1,324. The number of owner-operators used slipped to 545 from 550.
In its logistics division, the operating ratio improved to 93.87 from 94.39.
“Our logistics division continues to perform well despite a decrease in spot market rates. The decrease in spot rates did negatively impact revenue for the periods compared; however, this division is superbly managed and our current margins are superior to the 2018 margins,” Cushman said.
For the six-month period, net income increased to $16.9 million, or $2.84, compared with $8.6 million, or $1.39, a year earlier. Revenue rose to $222.6 million compared with $211.9 million.
P.A.M. ranks No. 65 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.
P.A.M. transports general commodities throughout the continental United States, as well as in the Canadian provinces of Ontario and Quebec. The company also provides transportation services in Mexico through its gateways in Laredo, and El Paso, Texas, under agreements with Mexican carriers.
