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Saia Inc. posted a strong gain in profit even as revenue grew modestly in the third quarter.
The Johns Creek, Ga.-based less-than-truckload carrier said net income jumped 26% to $41.5 million from $33 million in the same period a year earlier. Diluted earnings per share increased to $1.56 from $1.25.
Revenue rose by 2.7% to $481.4 million compared with $468.9 million in the 2019 period.
“Our plan at the beginning of the year was to focus on execution and capitalizing on data analytics and driving the pricing and cost optimization. I think we’ve done a pretty good job with that so far this year,” CEO Fritz Holzgrefe said in an Oct. 29 call with industry analysts.
The company is using data analytics and other techniques to better determine pricing. That paid off in the third quarter when renewed contracts came in at an average 6.9% increase. That compares with an average increase of 4.5% in the second quarter, Holzgrefe said.
Saia continues to build out its network by opening more facilities as it works to become a national carrier. The company has 169 terminals compared with about 240 offered by its larger competitors, Holzgrefe said.
It plans to add a 20th terminal in the Northeast and is eyeing opening several more. It is adding a second terminal in Atlanta and is considering expanding in Chicago.
It’s not just drivers. Finding mechanics, finding supervisors and managers — there is cost pressure there. … We’ve got to be competitive and provide a proper wage in the market.
Douglas Col, Saia chief financial officer
Earlier in October, Saia opened a 200-door terminal in Memphis, Tenn., that is 60% larger than the previous facility.
The carrier wants to increase its density in markets it already serves and open facilities closer to customers to improve speed and service, Holzgrefe said.
But it also is having trouble attracting key employees and anticipates labor expenses to rise.
“It’s not just drivers,” Chief Financial Officer Douglas Col said. “Finding mechanics, finding supervisors and managers — there is cost pressure there. … We’ve got to be competitive and provide a proper wage in the market.”
Saia’s third-quarter financial highlights included operating income of $55.2 million, a 21.7% increase from the same period a year earlier.
It had a record operating ratio of 88.5 compared with 90.3.
“To post a record operating ratio in one of the most volatile operating environments we have experienced in recent memory is a tribute to the thousands of Saia employees,” Holzgrefe said.
The company’s less-than-truckload shipments per workday increased by 0.9%, but its tonnage was flat. Less-than-truckload revenue per shipment rose 1.6% to $239.60.
Saia ranks No. 21 on the Transport Topics Top 100 list of the largest for-hire carriers in North America, and No. 9 on the LTL sector list.
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