Arkansas Best Widens Loss in 1st Quarter

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Arkansas Best Corp. said Friday “a number of unusual items” contributed to a first-quarter net loss that was much larger than expected and broke a string of profits in the previous three quarters.

Before the stock markets opened, the Fort Smith-based holding company reported a net loss of $18.16 million, or 71 cents per share, for the quarter that ended March 31, compared to a net loss of $12.81 million, or 51 cents per share, in the same period a year ago.

Sixteen analysts surveyed by Thomson Reuters had forecast an average estimated loss of 18 cents per share.

Revenue rose 1.4 percent to $440.87 million.

ABF Freight System Inc., the company’s largest subsidiary, accounts for more than 90 percent of Arkansas Best’s revenue.

Arkansas Best said in a news release that an unusually low corporate tax benefit rate and significantly higher workers’ compensation claims costs affected first-quarter results.

Judy McReynolds, Arkansas Best’s president and CEO, said in the release that although the results didn’t meet expectations, the company is positioning itself for longer-term success.

“The pricing measures we have taken have improved the incremental profitability of ABF’s account base for future periods,” she said. “Our deliberate actions of adding personnel and developing enhanced information technology systems, all designed to advance a high level of service and facilitate future growth, are essential investments for our company.”

The company’s release stated that tonnage trends this month were “the best ABF has experienced in over 20 years,” and that recent operational changes to ABF’s labor contract, phased in during March and April, should result in “improved efficiencies, more flexible utilization of employees and enhancements in ABF’s on-time delivery service.”

On Tuesday, Arkansas Best declared a quarterly cash dividend of 3 cents per share to holders of record of its common stock on May 8, payable May 22.

Shares of Arkansas Best were at $15.93 in early trading Friday on the Nasdaq, down 8.37 percent or $1.45 from the previous day’s close. The company’s stock has traded between $14.22 and $27.44 in the past year.