Truckload Profits Fall at TFI, Knight, Patriot Transportation; Rise at Forward Air
Truckload carriers continued to struggle as three out of four companies reported lower quarterly earnings versus 2016 levels as the industry struggles with excess capacity and lower prices.
TFI International announced net income dropped 7.8% to C$14.1 million in profits or $0.15, measured in Canadian dollars, compared with $15.3 million or $0.15 in the first quarter of 2016.
“As anticipated, TFI International’s first-quarter results were affected by difficult conditions in the U.S. Truckload market and certain integration costs [$7.5 million] related to the CFI acquisition. This overshadowed significant profitability increases in all other business segments,” Chairman and CEO Alain Bédard said.
Revenue rose 25% to $1.17 billion and went up 22% to $1.06 billion after removing fuel surcharges. Truckload revenue increased to $486.6 million from $337.7 million. Package and courier went to $320 million from $312 million. Less-than-truckload revenue rose to $199.2 million from $177.3. Logistics revenue increased to $67.6 million from $54.4 million.
Operating income, or the amount after expenses were deducted from revenues, increased in each division except truckload, which dropped to $14.7 million from $20.4 million.
TFI International ranks No. 10 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers.
Knight Transportation Inc. profits dropped 35% to $14.9 million, or 18 cents, which was anticipated after company executives lowered their earnings forecast shortly before truckload carriers began reporting figures.
In 2016, Knight generated $23 million or 28 cents per share.
Revenue inched downward 0.3% to $271.2 million but decreased 3.4% to $245 million after fuel surcharges were removed.
CEO Dave Jackson attributed the results to a weak freight environment in January and February, particularly in California.
Trucking revenue fell 3.5% to $192.5 million and after expenses were deducted, operating income was $20.3 million, or 44% lower than a year ago. Average revenue per tractor dropped 3.2% to $41,177.
Logistics revenue dropped 3% to $52.5 million, and operating income shrunk 15% to $2.4 million year-over-year.
Jackson said lower rates per loaded mile and fewer miles per tractor cost the company a nickel per share. Higher maintenance and driver recruiting cost them 2 cents, and professional fees to assist in the deal to merge with Swift Transportation lowered earnings by a penny.
The Phoenix carrier ranks No. 29 on the for-hire TT100.
Forward Air was one of the few bright spots in the earnings season with profits up 8.7% to $14.2 million, or 47 cents. One year ago, the company generated $13.1 million in profits, or 43 cents.
Revenue increased 7.6% to $247 million, including improvements in top-line results for truckload, expedited less-than-truckload, pool distribution and intermodal.
Truckload revenue rose 8.3% to $41.8 million, but operating income only rose to $1.7 million from $1.6 million after expenses.
Less-than-truckload revenue rose 4.6% to $140.6 million, and operating income grew 7.6% to $18.4 million. Tonnage rose 0.5%, and yield increased 3.7%.
Intermodal revenue increased 15% to $28.3 million, and operating income went up to $2.6 million from $2.4 million.
The Greeneville, Tenn., carrier ranks No. 35 on the for-hire TT100.
Patriot Transportation, a tanker carrier, saw year-over-year profits plunge 70% to $260,000, or 8 cents. Revenue fell 5.7% to $27.4 million.
The company’s subsidiary, Florida Rock & Tank Lines, ranks No. 15 on the Transport Topics sector list of top U.S. and Canadian tank and bulk carriers.
