Covenant Says Slow Freight Demand Hurting Profits

Truckload carrier Covenant Transport Inc. said Friday earnings for the second quarter would be between 18 cents and 22 cents per share, which it said is below current estimates.

The Chattanooga, Tenn.-based company said the main factor was "softer than expected freight demand, which impacted tractor productivity and non-revenue miles” during the quarter.

Covenant said that according to Nasdaq, current analysts' estimates were 22 cents to 33 cents. Earnings for the second quarter of 2002 were 21 cents.

The company also said although freight demand is weaker, rates per mile are anticipated to increase 2% to 3% above last year's second quarter.

Earlier Friday, USF Corp. warned that its second-quarter profits would be lower than previously predicted because of slow demand. (Click here for the full story.)

Covenant is expected to report its second-quarter earnings on July 22.

The company is ranked No. 32 on the 2002 Transport Topics 100 list of the largest U.S. and Canadian trucking companies.

(Click here for the full press release.)