In the midst of a buoyant economy, less-than-truckload carrier Saia Inc. on Aug. 1 reported strong second-quarter earnings.
The Johns Creek, Ga.-based company said net income was nearly $30.3 million, or $1.18 a share, compared with $17.6 million, or 69 cents, in the year-ago period. Operating revenue was up nearly 18%, reaching a quarterly record of $428.7 million, compared with $364.4 million, for the same period in 2017.
Saia reported its operating ratio improved to 90.3 from 91.9. Operating ratio is a company’s operating expenses as a ercentage of its revenue and is used to determine efficiency. The smaller the ratio, the greater the company’s ability to generate profit.
The company said the strong economy resulted in LTL shipments increasing by 4.3%, revenue per shipment jumping 13.2% and tonnage rising 7.7%. Revenue per hundredweight rose 9.6%, and the length of haul moved higher by 3.8%. Saia, which instituted a 5% rate increase in May, says third-quarter demand continues to remain strong.
“A strong freight environment, tight supply and our own initiatives to grow shares, and improved yield all contributed to revenue growth of nearly 18% in the quarter,” CEO Rick O’Dell said on a conference call with reporters and analysts.
The company said that because of the strong business, it has increased the number of employees by 7%. Salaries and benefits for all employees has jumped by 12.2% year-over-year, including a 3.6% salary increase that took effect in July.
Saia said it has opened three new terminals in 2018 and plans to add three more before the end of the year. The carrier currently operates 157 terminals in 40 states. “We continue to see an opportunity to be more selective with regard to the freight we are choosing to haul in this difficult capacity environment,” O’Dell said, “and we will continue to target shippers who recognize our value proposition.”