Covenant Seeking to Boost Utilization

June 7, 2001
TL carrier Covenant Transport has said it expects its second-quarter results to fall short of expectations, with projected earnings of between $0.02 to $0.05 per share. “The weak economy and high fuel prices continue to impact Covenant’s financial results,” said David R. Parker, Covenant’s president & CEO. “Our number-one goal is to return the company to the profitability levels we produced in 1998
TL carrier Covenant Transport has said it expects its second-quarter results to fall short of expectations, with projected earnings of between $0.02 to $0.05 per share.

“The weak economy and high fuel prices continue to impact Covenant’s financial results,” said David R. Parker, Covenant’s president & CEO. “Our number-one goal is to return the company to the profitability levels we produced in 1998 and 1999.” Parker said the carrier expects difficult operating conditions to continue through the remainder of 2001. However, he added that the key to that goal is returning utilization to approximately 140,000 miles per tractor annually.

“We believe that utilization bottomed out in the first quarter but expect utilization for the second quarter to increase sequentially and year-over-year,” Parker said.

Parker added that Covenant is experiencing rate pressure, with freight rates expected to be down $0.02 to $0.03 per mile in the second quarter as a result of new business and growth in its dedicated division. An increase in diesel fuel prices of over $0.13 per gallon since the end of March also has impacted Covenant's earnings significantly, he said.

About the Author

Sean Kilcarr | Editor in Chief

Sean previously reported and commented on trends affecting the many different strata of the trucking industry. Also be sure to visit Sean's blog Trucks at Work where he offers analysis on a variety of different topics inside the trucking industry.

Voice your opinion!

To join the conversation, and become an exclusive member of FleetOwner, create an account today!

Sponsored Recommendations

Leveraging telematics to get the most from insurance

Fleet owners are quickly adopting telematics as part of their risk mitigation strategy. Here’s why.

Reliable EV Charging Solution for Last-Mile Delivery Fleets

Selecting the right EV charging infrastructure and the right partner to best solve your needs are critical. Learn which solution PepsiCo is choosing to power their fleet and help...

Overcoming Common Roadblocks Associated with Fleet Electrification at Scale

Fleets in the United States, are increasingly transitioning from internal combustion engine vehicles to electric vehicles. While this shift presents challenges, there are strategies...

Report: The 2024 State of Heavy-Duty Repair

From capitalizing on the latest revenue trends to implementing strategic financial planning—this report serves as a roadmap for navigating the challenges and opportunities of ...