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Werner Enterprises reported declines in second-quarter revenue and net income during what the company’s leader said was one of the toughest business environments it has ever confronted.
“The second quarter 2020 was one of the most challenging periods in our nation’s history, and our company’s history as well,” CEO Derek Leathers said during a July 29 conference call with investors to discuss the company’s quarterly financial report, which was released that day.
The Omaha, Neb.-based freight carrier and logistics company reported Q2 net income of $39.1 million, or 56 cents a diluted share, compared with $43.3 million, or 62 cents a share, during the year prior. Total revenue for the three-month period ended June 30 declined by 9% to $569 million from $627.5 million.
Wall Street analysts had expected net income of 40 cents per share on revenue of $580.83 million, according to Zacks Consensus Estimate.
Werner’s truckload segment saw Q2 revenue decrease 7% to $445.1 million from $480 million, which it attributed to a $28.3 million decrease in fuel surcharge revenues and a 2.2% decrease in average trucks in service.
These declines were partially offset by a 1.1% increase in average revenues per truck. Operating income in the segment decreased 1% to 51.2 million from 51.7 million the prior year.
The logistics segment reported that Q2 revenue declined 16% to $110.2 million from $130.9 million. It attributed the declines to a 9% reduction in volume brought on by a soft freight market, along with lower rates and lower fuel prices, which reduced all-in truckload logistics revenue per load by 15%. Operating income decreased 39% to $3.1 million from $5.1 million the prior year.
“We experienced a significant decline in economic activity in the first half of the quarter,” Leathers said. “This affected the freight volumes of some of our one-way truckload and logistics customers who were forced to temporarily close or significantly curtail their business. As we moved into the back half of the quarter, we saw steady recovery of one-way truckload freight volumes from these customers as they reopened. This improving freight trend continued into July.”
Leathers noted that in the early days of the pandemic the company took immediate action to safeguard associates while delivering on the needs of customers. That included implementing safety protocols and purchasing safety supplies.
“Our employees, customers, suppliers and third-party providers contended with the rapidly changing landscape and the unprecedented impact associated with COVID-19,” he said.
Werner Enterprises was founded in 1956. The company has grown to include over 7,800 tractors, 24,000 trailers and approximately 13,000 associates and independent contractors worldwide. Werner has coverage throughout North America, Asia, Europe, South America, Africa and Australia.
Werner ranks No. 16 on the Transport Topics Top 100 list of largest for-hire carriers in North America and No. 17 on the Transport Topics Top 50 list of largest logistics companies.
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