ArcBest reports gains in per day shipments, better revenue

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by Michael Tilley ([email protected]) August 29, 2023 3:23 pm 804 views 

Judy McReynolds, chair, president and CEO of Fort Smith-based ArcBest was on Wall Street in New York, N.Y., Tuesday to ring the bell at the NASDAQ stock exchange as part of the company’s 100th anniversary. (photo from ArcBest)

Third and fourth quarter financial results will not be as healthy as they were in what was a record-setting 2022, but officials with Fort Smith-based ArcBest say market realities are showing some improvement.

The shipping and logistics company on Monday (Aug. 28) filed an 8K with the U.S. Securities and Exchange Commission that provides insight into business trends in the third quarter. Specifically, ABF Freight, the company’s largest subsidiary that is one of the country’s largest less-than-truckload (LTL) carriers, is seeing gains in demand and pricing.

“Moving through the current quarter, recent changes in LTL market dynamics have contributed to improved revenue trends in the Asset-Based segment. As a result of profitable account opportunities, we are currently targeting total average daily shipments of approximately 20,000 shipments per day compared to the 19,500 shipments-per-day target in July 2023. So far in August 2023, the Asset-Based segment has experienced more than a 20% increase in core, LTL-rated shipments per day when compared to June 2023,” the company noted.

The company said revenue per hundredweight at ABF was down 11.2% in June compared with June 2022, but improved to being down only 2% in August. The August tally was preliminary.

Judy McReynolds, chair, president and CEO of Fort Smith-based ArcBest was on Wall Street in New York, N.Y., Tuesday to ring the bell at the NASDAQ stock exchange as part of the company’s 100th anniversary. (photo courtesy of ArcBest)

However, the outlook is not as positive for the company’s logistics – or asset-light – segment. The company is estimated that logistics operating income could be $10 million to $15 million less than the $13.18 million in the second quarter of 2023.

“Year-over-year changes in revenue per shipment and purchased transportation expense as a percentage of revenue reflect continued market softness combined with business mix changes,” according to the 8K.

ArcBest net income in the first half of the fiscal year totaled $111.726 million, below the $172.03 million in the same period of 2022. Revenue in the first six months was $2.209 billion, also below the $2.589 billion compared with record levels set in the same period of 2022.

The consensus estimate among analysts who cover ArcBest for the third quarter is that the company will post per share earnings of $1.74, which would be well below the $3.50 in the third quarter of 2022. The revenue consensus estimate is $1.12 billion, below the $1.34 billion in the same quarter of 2022.

ArcBest shares (NASDAQ: ARCB) closed Tuesday at $104.60, up $1.12 on lower than average trading volume. The share price in the past 52 weeks has ranged between $122.86 and $68.