Old Dominion Reports Revenue, Earnings Decline for Q1

CEO Greg Gantt Says Numbers Reflect Softness in Economy
Old Dominion Freight Line truck in the city
Old Dominion posted its first decline in quarterly revenue and earnings per diluted share in more than 2½ years. (Old Dominion Freight Line)

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Old Dominion Freight Line experienced a year-over-year decline in revenue and earnings amid a softening freight environment during the first quarter of 2023, the company reported April 26.

The Thomasville, N.C.-based less-than-truckload carrier ranks No. 9 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.

Old Dominion reported net income of $285 million, or $2.58 a diluted share, for the three months ending March 31. That compared with $299.8 million, $2.60, during the same time the previous year. Total revenue decreased by 3.7% to $1.44 billion from $1.5 billion.

Operating ratio slipped to 73.4% from 72.9% during the same time the previous year. Operating ratio shows management’s cost efficiency while generating revenue. The smaller the ratio, the more efficient the company is.

“These numbers were slightly below our first-quarter results from 2022 and reflect the ongoing softness in the domestic economy and the challenging operating environment,” Greg Gantt, CEO of ODFL, said during a call with investors. “We are also coming off a record year in 2022 where revenue and profits were at an all-time high.”


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Gantt noted the resulting decrease in volumes contributed to the first decline in quarterly revenue and earnings per diluted share in more than 2½ years. He was cautiously optimistic at the start of this year that business levels would start to improve late in the first quarter and accelerate in the second quarter, but that has yet to materialize.

“While our volume stabilized during January and February as expected, we have not seen the acceleration in volumes that was originally anticipated,” Gantt said. “Our shipments per day have remained consistent on a daily basis so far this year, but on a year-over-year basis, shipments in April are trending down double digits.”

The decrease in revenue included an 11.9% decline in LTL tonnage per day to 36,540 from 41,454 during the prior-year quarter. This was partially offset by a 9.2% increase in LTL revenue per hundredweight to $30.71 from $28.13 last year. The company also experienced a 9.6% decrease in LTL shipments to 3.02 million from 3.34 million.

“Fortunately, our market share has remained relatively consistent and our yield continues to improve,” Gantt said. “We believe the stability with our market share during the first quarter reflects the value of our service offering and the success of our long-term strategic plan. The guiding principles of this plan have been in place for many years and have helped us produce a strong track record for long-term profitable growth throughout the economic cycle.”

Gantt added the long-term strategic plan is centered on delivering superior service at a fair price. He noted the company remains committed to providing on-time service as well as claims free service.

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“We’ll continue to focus on delivering a value proposition to our customers while also maintaining a disciplined approach to managing the fundamental aspects of our business,” Gantt said. “This will include making the best decisions to help us navigate through a challenging environment in the short term while also positioning us for future opportunities to produce long-term profitable growth.

While we like to measure our success over years, we believe it takes winning on a daily, weekly and monthly basis to add up to long-term success.”

The results were below expectations by investment analysts on Wall Street, who had been looking for $2.69 per share and quarterly revenue of $1.48 billion, according to Zacks Consensus Estimate.

“I want to close my last earnings call as CEO by saying, how incredibly proud I am of the entire OD family of employees,” Gantt said, “all 23,000 of us and the track record of success that we have produced together. I am encouraged by the prospects that our team has for future growth.

“Without any doubt, I stand firm in my belief that OD has the strongest team in the industry, the best service in the industry, and is better positioned than any LTL carrier to continue to win market share while also increasing shareholder value.”

Gantt has served as company president and CEO since May 2018. He plans to retire from the company June 30 but expects to remain a member of the board of directors.

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