Dallas, TX-based refrigerated carrier Frozen Food Express Industries (FFE) said its net income declined sharply in the first quarter this year due the costs associated with an audit of its billing practices – which delayed the filing of first-quarter results – and falling truckload revenues as freight shifted to LTL lanes.
For the first quarter, FFE’s total revenue increased 6.8% from the same period in 2005 to $126.1 million. Though overall freight revenue increased 6.7% in the first quarter, truckload revenue fell 4.3%, due largely to a shift towards higher-margin offerings such as LTL and dedicated fleet services, said Chairman and CEO Stoney M. Stubbs, Jr. He noted that FFE’s LTL revenues climbed 13.7% in the first quarter this year compared to last year, due to improved shipment and hundredweight volumes, as well as general LTL rate increases.
However, higher operating expenses, plus the cost of the audit, depressed the carrier’s net income to $1.9 million. Net income for the first quarter of 2005 was $3.3 million.
Despite that profit decline, Stubbs remains confident about FFE’s potential performance for the rest of 2006.
