Truckload carrier Marten Transport has announced that its profits rose substantially for the second quarter and first half of 2004-- despite the bottom-line impact of high fuel prices and a worsening driver shortage.
For the second quarter, net income increased 36.1% to $4.8million on 9.1% higher revenues of $91.9 million compared to the same period last year. For the first half of 2004, Marten reported 52.9% higher net income of $7.5 million on 7.9% larger revenues of $176.4 million compared to the first half of 2003.
“Higher average freight revenue per mile was the main factor that influenced our results,” said Randy Marten, chairman & CEO of the Mondovi, WI-based carrier. “Strong efforts by our sales and operations personnel and a favorable relationship between freight demand and industry-wide trucking capacity allowed us to raise freight rates. This contributed to a 5.6% increase in average freight revenue per total mile, to $1.28 in the second quarter of 2004 from $1.22 in the same quarter in 2003, which more than offset a 3.4% reduction in average miles per tractor.”
Marten added that, as a result of these factors, average freight revenue per tractor per week – the company’s main measure of asset productivity – improved 2% to $2,930 in the second quarter from $2,872 in the same period last year.
Still, high fuel prices and an ever-growing shortage of drivers aren’t making it easy, he said.
“The main challenges during the quarter were high fuel prices and a tight driver market. A combination of higher fuel prices and the lower fuel economy of new tractor engines cost us approximately 50 basis points on our operating ratio, or 2 cents per share, versus the second quarter of 2003,” Marten explained.
“And although Marten offers driver compensation near the upper end of the industry, our driver turnover remained at 60% and it has become increasingly difficult to attract high-quality drivers,” he noted. “We believe the stronger economy is offering more job alternatives and that it has been, and will be, difficult to add meaningful capacity for the foreseeable future.”