USA Truck earnings up in third quarter; down for first nine months

Van Buren-based USA Truck remained in positive earnings with its third-quarter report, but the national long-haul company has lost $1.51 million for the first nine months of the year.

The company earned $586,000 during the quarter, an improvement over the $4.7 million loss in the same period of 2009. The per share earnings of 6 cents were in line with analyst estimates.

Higher diesel fuel prices — ranging between 4 cents and 7 cents higher than in the 2009 period — bit into USA Truck’s revenue. The company said its fuel prices were, on average, 11.9% higher than the third quarter of 2009, which reduce earnings by a significant 10 cents per share. The company operated 2,366 trucks at the end of the third quarter, compared to 2,297 in the fleet at the same period in 2009.

Total revenue for the quarter reached $118.766 million, up 23.4% over the $96.171 million in the same quarter of 2009.

For the first nine months of the year, the company posted total revenue of $338.071 million, up 19.8% over the same period in 2009. The company’s net income loss of $1.51 million for the first nine months is an improvement over the $4.665 million lost during the same period of 2009.

The ongoing national freight recession has been tough on USA Truck Inc., which reported a 2009 net income loss of $7.177 million compared to a gain of $3.14 million in 2008. The company posted 2009 revenue of $382.36 million, down 28.6% compared to the $535.62 million in 2008.

“Our business model is beginning to take the form we envisioned when we began executing our VEVA (Vision for Economic Value Added) strategic plan two years ago,” Clifton R. Beckham, USA Truck president and CEO, noted in the earnings statement. “Our Trucking services are steadily improving as they conform to our Spider Web freight network design. Nearly 48% of our freight moved in Spider Web lanes during the quarter compared to just 39% a year ago. That improved network compliance enabled us to simultaneously drive down our length-of-haul by 5.4% to 546 miles, reduce our empty miles to 10.3%, improve our miles per tractor per week by 2.5% to 2,007 and raise our revenue per total mile by 9.2% to $1.42.”

Other improvement measures the company identified in the earnings report include:
• Gain of owner-operator rigs helped boost trucking base revenue by 14.5%;
• Reduction in “recordable accident frequency” by 20.8% lowered insurance and claims costs; and,
• Driver turnover rate fell by 18%, which reduced recruiting costs and other driver-related costs.

The company also offered a few thoughts on expected economic conditions going forward.
• “Demand has moderated recently and we have yet to see a strong fall peak shipping season, so we expect the overall market to remain near equilibrium until Thanksgiving with demand outstripping capacity in certain parts of the country.”

• “We expect elevated fuel costs, continued tight credit, an aging tractor fleet and implementation of the Department of Transportation’s Comprehensive Safety Analysis 2010 (a wide-ranging performance-based safety initiative) in November to create a more significant shortage of trucks in 2011 than the industry has experienced during 2010.

• “While we are optimistic about the industry’s prospects as 2011 and beyond unfolds, we are bracing for what is likely to be two challenging quarters between now and next spring.”

• “We have improved our model considerably over the past year and those improvements will serve us well for the next six months, but we are also facing some near-term headwinds.”

Shares of USA Truck closed Wednesday at $14.91, up 15 cents. During the past 52 weeks the share price has ranged from a high of $18.79 to a $10.78 low.