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U.S. Xpress Enterprises’ net income and revenue increased during the second quarter, the Chattanooga, Tenn.-based carrier reported July 28.
Net income was $9.03 million, or 18 cents a diluted share, for the three months ending June 30. That compared with $2.99 million, or 5 cents a share, during the same time the previous year. Total operating revenue increased 2% to $422.5 million from $413.9 million in 2019.
The results exceeded expectations by Wall Street analysts, who had been looking for negative 15 cents per share and quarterly revenue of $420.27 million, according to Zacks Consensus Estimate.
U.S. Xpress also reported that net income attributable to controlling interest was $9.5 million for the quarter. That compared with $2.7 million the prior year. This factors in incurred losses on a sale related to an equity method investment in a formerly owned subsidiary.
“I am very pleased with our second-quarter results,” U.S. Xpress CEO Eric Fuller said during a conference call with investors. “We are beginning to see tangible financial benefits from our strategic initiatives focused on utilizing technology to improve our process, accelerate the velocity of our business, improve our customer and driver satisfaction, and lower costs.”
Fuller added that the company achieved approximately 500 basis points of margin expansion during the second quarter compared with the first quarter. U.S. Xpress also delivered an adjusted operating ratio of 95.9. The coronavirus pandemic did not disrupt the volumes for major dedicated accounts.
“These improvements exceeded normal season improvements and was achieved despite rate pressure in the over-the-road division,” Fuller said. “There continues to be excess tractor capacity relative to freight demand in the market for the majority of the quarter due in part to COVID-19.”
Fuller added that the company also has undertaken efforts to go digital, which contributed to gains during the quarter. That includes its digital fleet and frictionless order initiative. Together, these initiatives aim to reduce repetitive tasks so drivers can spend more time moving freight and serving customers.
The truckload segment reported that revenue increased 4.5% for the quarter to $347.9 million from $331.7 million during the prior-year Q2. Operating income for the segment increased 24.7% to $20.4 million from $7.5 million.
“Brokerage segment revenue increased to $46 million,” Fuller said. “This was primarily driven by increased loads and partially offset by a decrease in revenue per load. We incurred an operating loss of $4.2 million compared to operating income of $1.3 million in the year-ago quarter. Improving brokerage markets is a priority for our team, and we have initiatives in place that we are working on.”
U.S. Xpress started with 48 trucks when it was founded in 1986. Since that time, the company has grown to include 7,000 tractors and 15,500 trailers. It also is one of the largest asset-based truckload carriers by revenue in the country.
U.S. Xpress Enterprises ranks No. 24 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 31 on the TT Top 50 list of the largest logistics companies in North America.
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