Roadrunner Transport Systems reported an improvement in operating results for the first quarter, ended March 31, but net losses grew.
The report follows the June release of its financial results for all of 2017.
Getting up to date on financial filings is one part of Roadrunner’s strategy to rebound from its internal investigation that found the previous management made substantial accounting errors over several years. Roadrunner reviewed and restated its results for several years.
The company on July 2 posted a net loss of $23.6 million on revenue of $570 million as it got up to date on its financial filings with the Securities and Exchange Commission. In comparison with first quarter 2017, the results represent a 19% increase in revenue from $478.9 million and a nearly 19% rise from its net loss of $19.9 million.
Its diluted loss-per-share was 61 cents compared with a loss of 52 cents a year ago.
Roadrunner attributed the increased loss to higher interest costs related to the company’s preferred stock issued in May 2017.
Downers Grove, Ill.-based Roadrunner reported higher revenue in its Truckload & Express Services and Less-than-Truckload segments while its third major division, Ascent Global Logistics, saw lower revenue due to the sale of its Unitrans unit last September.
The truckload unit had operating income of $4.4 million compared with a loss of $1.7 million a year ago. Revenue rose more than 43% to $326.1 million from $227.5 million due to increases in ground and air expedited freight business. Revenue at the LTL unit rose 4% to $113.1 million from $108.8 million due to higher fuel surcharges and rates. The unit had an operating loss of $8.7 million compared with a $2.7 million loss a year ago.
The Ascent group saw operating income decline to $6.7 million from $7.6 million. Ascent provides freight management and forwarding and other services. Revenue came in at $134.9 million, down from $145.5 million a year ago. Unitrans brought in $25.2 million in revenue in the quarter a year ago.
One focus is the turnaround of Roadrunner’s LTL segment, said CEO Curt Stoelting.
“Our LTL management team is working to improve the quality of freight and density within our key lanes as well as improving our service and operating metrics,” said Stoelting. That effort will lead to reduced second-quarter revenue for the segment but better results in the second half of the year, said Stoelting.
In June Roadrunner released its results for full year 2017, reporting a net loss of $91.2 million, or $2.37 per diluted share, compared with a loss of $360.3 million, or $9.40 a diluted share.
Revenue totaled $2.1 billion in 2017, up nearly 3% from $2 billion the previous year.
The company had an operating loss of $36.5 million in 2017 compared with a loss of $403.8 million in 2016.
The TL segment contributed revenue of $1.3 billion, a 4.7% rise from $1.2 billion in 2016. The LTL segment had revenue of $463.5 million, up from $461.5 million. The Ascent logistics unit reported revenue of $328.3 million, a 2% drop from $335.5 million in 2016.
An SEC and U.S. Justice Department investigation of Roadrunner’s internal investigation that led to discovery of the accounting errors by management led to the June 15 indictment of two former Roadrunner finance executives for multiple counts of conspiracy and wire and securities fraud in a scheme DOJ said led to a loss of $245 million in shareholder value.
The indictment said the scheme was designed to mislead shareholders, auditors and regulators from Roadrunner’s financial condition “to maintain and increase the market price of Roadrunner’s stock” while those charged continued to receive their pay, stock and other benefits.
The indictment lists but doesn’t name five co-conspirators, including a former board member, who were part of the alleged scheme. Roadrunner and the DOJ have declined to comment on the continuing investigation.