The latest round of trucking-related quarterly earnings reports brings more good news of firm rates and bulging profits, suggesting the industry had plenty of momentum to push through the seasonally slower fourth quarter.
“Looking at the trucking industry on a collective basis, pricing stayed firm,” Satish Jindel, president of S.J. Consultants told FleetOwner. He added that so far there are no indications of any downturn in manufacturing or construction-which are important drivers of trucking activity--in the foreseeable future.
Landstar System said fourth quarter profits jumped 75% to a record $43 million, compared with 4Q 2004. The gangbuster earnings came thanks to industry-wide tight capacity combined with the company’s lucrative contract with the Federal Aviation Administration to provide transportation services during national emergencies, which included the Gulf Coast hurricanes. Hurricane disaster relief efforts accounted for $138 million of the $800 million in total 4Q revenues and a windfall profit of $16.7 million.
J.B. Hunt saw fourth quarter profit jump more than threefold to $65.3 million while operating revenue was up 11% compared to 4Q 2004. J.B. Hunt operates truck, intermodal and dedicated segments, which for the quarter drew in $284 million, $359 million and $222 million, respectively. Excluding fuel surcharges, the carrier’s operating ratio was 85.6%.
J.B. Hunt noted that its intermodal segment will remain vigilant in passing on rate increases to offset rising rail costs, driver pay and equipment prices-all signs of tight capacity. The carrier noted that rail transit times are slowing, which decreased driver productivity.
The company’s dedicated segment saw increasing demand from both existing and new customers, enabling it to boost profits simply by deploying existing assets to the most lucrative accounts and increasing utilization. “However, with demand remaining strong into 2006, we are approaching the point where customer demands cannot be met with existing assets,” the company stated.
YRC Worldwide, formerly known as Yellow Roadway Corp., said 4Q operating revenue (revenue before tax) was $2.48 billion, with an operating profit of $154 million.
“We had another excellent year in 2005 both financially and strategically,” stated Bill Zollars, chairman, president & CEO of YRC Worldwide. “Our business units performed well and delivered solid financial results, which are even more impressive considering we added the USF companies to our portfolio and realigned our regional service coverage.”
Arkansas Best Corp., parent company of ABF Freight System, posted a $30.2 million profit-a 24% premium over the same quarter in 2004. Revenues totaled $496 million, which represents a per-day increase of 11%. Its operating ratio was 89.4%.
ABF Freight System accounted for $455.5 million of Arkansas Best’s revenue. ABF's fourth quarter 2005 total tonnage per day increased 1.4% compared to the same period last year. Rates through the quarter stayed solid, according to said Robert A. Young III, Arkansas Best chairman & CEO.
“There has been little change in the overall pricing environment during the fourth quarter Pricing by both ABF and its competitors continues to be rational,” said Young. “ABF has been able to secure acceptable price increases across its account mix, including those with contractual and deferred pricing agreements.”
Jacksonville, FL-based Patriot Transportation Holding said its first quarter profit of fiscal 2006 increased 13% to $1.9 million. The company runs three separate operations to haul liquid and bulk commodities, provide flatbed transportation, and haul construction materials.
Schneider National Inc., a privately held provider of transportation, logistics and related services, reported “solid” financial performance for 2005, achieving consolidated revenue growth and ending the year with $3.5 billion in revenue, up from $3.2 billion in 2004.
Truck leasing provider Ryder System reported its earnings slipped 6% to $58.8 million, despite a 13% revenue increase to $1.54 billion.