J.B. Hunt posts revenue, income declines
by October 19, 2009 4:48 pm 63 views
A Monday (Oct. 19) earnings report from J.B. Hunt Transport Services provides clear indication that he trucking industry is still suffering from a freight recession that most observers say began in October 2006.
The Lowell-based trucking giant reported Monday that its total revenue for the first nine months of 2009 was $2.326 billion, down 18.4% from the same period in 2008. Net income for the first nine months was $94.77 million, down 35.6% from the same period in 2008.
“The freight recession that began in the second half of 2006 continued into its third year. Our diversified transportation platform has allowed us to weather the storm in relatively strong fashion,” the company noted in its statement. “ We have noted some recent signs of firming demand, however, the freight economy remains weak and we are not anticipating a rapid improvement. Consequently, until freight rates start to return to a reasonable level, margins are unlikely to improve dramatically.”
For the third quarter ended Sept. 30, the company had revenue of $833.74 million, down 16.3% from the same quarter of 2008. Net income in the quarter was $39.96 million, down 33.7% from the 2008 quarter.
The company’s pure trucking sector saw third quarter revenue of $119 million, down 30% from the same period of 2008. More telling is that the trucking sector posted a $400,000 net income loss for the quarter.
Rates in most of its sectors experienced significant drops, leading to the downward pressure on revenue and income, the company said. The low rates seen in the trucking sector could become a problem when the economy recovers.
“The elimination of reasonable pricing in the transportation and logistics business could result in the inability of transportation providers to respond to a sharp pick-up in demand likely leading to service disruptions, significant price increases and more adequate returns,” noted the company statement.
Shares of J.B. Hunt (NASDAQ: JBHT) closed Monday at $33.93, up 2 cents. The earnings report was released after the close of markets. For the past 52 weeks, the share price has ranged from a 34.78 high to an $18.14 low.