An improved freight market environment allowed Fort Smith-based ArcBest to better balance revenue with costs resulting in quarterly net income growth of 80.7% and operating income gains in its trucking and logistics divisions.
The transportation holding company reported Tuesday (Nov. 3) third quarter net income of $29.404 million, up 80.7% compared with $16.27 million in the same quarter of 2019. Net income per share of $1.11 beat the consensus estimate among analysts of 79 cents. Quarterly revenue was $794.98 million, better than the $787.563 million in the same quarter of 2019, and better than the consensus estimate of $774.39 million.
ArcBest is the parent company of ABF Freight, one of the nation’s largest less-than-truckload carriers, and ArcBest Logistics and FleetNet.
ArcBest Chairman, President and CEO Judy McReynolds said the company was able to benefit from an improving economy by using its technology to help customers better manage supply chains.
“I am incredibly proud of our employees and how they have performed on behalf of customers as we navigate through the pandemic together,” McReynolds said in the earnings report. “Throughout the third quarter and into October the ArcBest team, enabled by technology and assured capacity options, is providing much-needed flexibility to customer supply chains while also improving operational efficiency. Our company was built on strong customer relationships and it is our goal to ensure those customers are positioned well to succeed.”
Net income in the first nine months of 2020 totaled $47.186 million, just ahead of the $45.534 million in the same period of 2019. Revenue in the first nine months was $2.123 billion, down from the $2.27 billion in the same period of 2019.
ABF Freight revenue totaled $561.856 million in the third quarter, below the $565.621 million in the same quarter of 2019. Operating income for the segment was $36.646 million, better than the $31.722 million in the same quarter of 2019.
Revenue per hundredweight, a key metric in the trucking industry, was $35.69, down 1.8% from the $36.35 million in the 2019 quarter. The company said reduced fuel surcharges partially resulted in the decline. However, revenue per shipment in the quarter was $454.94, better than the $443.82 in the same quarter of 2019. There were 1.242 million shipments in the quarter, down 2.3% from the 1.271 million in the 2019 quarter.
The company shipped 792,258 tons in the quarter, up 2% compared with the same quarter in 2019. The company noted that better results at ABF Freight “reflects the positive impact of an improving marketplace and sequential growth in shipments and tonnage compared to the second quarter.”
Revenue in the asset-light business – ArcBest Logistics and FleetNet – was $267.839 million, better than the $253.734 million in the same quarter of 2019. Operating income in the segments totaled $5.818 million, up from the $3.623 million in the same quarter of 2019.
Company shares (NASDAQ: ARCB) closed Tuesday at $33.50, up $2.05 on an above average volume of trading. During the past 52 weeks the share price ranged between $36.15 and $13.54.