Werner Enterprises posted double-digit gains in revenue and profits in the third quarter as demand for the company’s one-way truckload freight hauling services was “stronger than normal” and shippers paid higher rates.
In a statement released Oct. 18, Werner said it earned $47.5 million, or 66 cents a share, in the three months ended Sept. 30, compared with $22.5 million, or 31 cents a share, in the same period a year ago. Revenue grew 19%, to $629.7 million from $528.6 million.
Werner’s results largely are in line with expectations for other publicly traded trucking companies.
Average revenue per tractor per week, excluding fuel surcharges, increased 10.3% to $4,074 in the third quarter of 2018 from $3,696 in 2017, reflecting higher contract rates. The company also experienced an increase in surge volume and dedicated contract carriage services.
“Changing shipper freight-replenishment patterns and faster on-time service requirements are occurring as some customers shift freight from longer-haul one-way fleets to shorter length-of-haul dedicated fleets,” Werner stated. “As a result, more trucks are needed to service an increasing amount of shorter-haul freight.”
Werner was able to expand its fleet, despite difficulties in finding enough drivers.
The company ended the third quarter with 7,750 trucks in its truckload segment, an increase of 375 from the same period a year ago, and 4,400 trucks in its dedicated business, an increase of 445 trucks.
In contrast, Werner said that the number of power units provided by independent owner-operators has declined and was 615 at the end of the third quarter in 2018 versus 675 a year ago.
The company said it is taking steps to get more drivers by increasing pay, buying new equipment and working with customers to improve or eliminate unproductive freight.
“These efforts continue to have positive effects on our driver turnover,” Werner stated in its earnings release, noting that driver turnover in the third quarter was the lowest percentage in the past 20 years.
Werner recorded a $4.6 million gain on assets in the third quarter as the company sold 40% more trucks and trailers than a year ago and benefited from rising prices for used equipment.
Looking at a breakdown of results, Werner reported higher profits and revenue for its truckload and logistics business units.
Operating profits for truckload transportation services were $58.9 million in the third quarter of 2018 versus $34 million a year ago. Revenue, excluding fuel surcharge, was $484.8 million in 2018 versus $407.6 million in 2017.
Werner Global Logistics had operating profits of $4.8 million on revenue of $58.9 million in 2018 compared with operating profits of $1.3 million on revenue of $34 million a year ago.
Werner, based in Omaha, Neb., ranks No. 15 on the Transport Topics Top 100 list of the largest for-hire carriers in North America. Werner Global Logistics ranks No. 21 on the Transport Topics Top 50 list of largest logistics companies in North America.