ArcBest, Saia Announce Lower Second-Quarter Earnings
Second-quarter net income declined 31% at Saia Inc. and 49% at ArcBest Corp. as the trend toward lower earnings at most carriers persisted in a freight market both companies described as “challenging.”
ArcBest, which is based in Fort Smith, Arkansas, earned $10.2 million, or 39 cents, including a drop of 38% in profits before interest and taxes at the less-than-truckload unit and 77% at the company’s Panther logistics unit. Year-earlier period earnings at ArcBest were $20 million, or 74 cents. Saia’s earnings slipped to $13.3 million, or 52 cents, from $19.2 million, or 75 cents.
“The inconsistent economic operating environment combined with a surplus of transportation capacity continues to impact available business levels and operating margins,” the ArcBest statement said.
Revenue at ArcBest was about 3% lower at $676.6 million.
The ABF Freight LTL business revenue was off 3% at $486.7 million. That unit increased freight shipments by 0.4%, but tonnage fell 3.2%. The LTL operating ratio was 96.4, two percentage points worse than the prior-year period. Costs were hurt by the proportionally larger costs to handle lighter shipments. LTL pricing continues to be competitive, but rational, the statement said.
In the asset-light segment, revenue rose to $205.2 million from $204.9 million. Panther’s revenue fell 13% to $69.7 million and the brokerage unit increased 35% to $67.9 million. Household goods and maintenance business revenue also declined. Transportation management profits excluding interest and taxes dipped more than 70%, due to lost productivity during systems integration and training.
Saia CEO Richard O’Dell cited improved pricing as a positive factor that was offset by accident and health care costs.
The Johns Creek, Georgia-based company’s revenue fell 3.6% to $312 million as tonnage fell 4.3%, shipments declined 2.6% and revenue per 100 pounds of freight was 2% higher. LTL shipment weight dipped 1.7%. Saia's operating ratio worsened to 93.0 from 90.3.
Saia reported contract rate increases of 5.4%, while ABF Freight said those prices climbed 2.9%.
The results fell 4 cents per share short of the average analyst estimate at ArcBest, which is No. 12 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers. No. 25 Saia missed estimates by 3 cents per share.
