Arkansas Best Had Largest Profit Leap

Wal-Mart Stores Inc. of Bentonville is still the heftiest public company in Northwest Arkansas, and the state for that matter.

But the big boy of local profit performance for fiscal 2000 was Arkansas Best Corp. in Fort Smith. The diversified trucking and logistics firm saw a 51 percent net income improvement, jumping from $50.4 million in 1999 to $76.2 million last year.

Wal-Mart had the second best profit growth with a 17 percent increase from $5.4 billion to $6.3 billion.

Arkansas Best will have another cash influx when it completes the $40 million sale of subsidiary G.I. Trucking Co. to a team of its executives. The deal, announced Aug. 2, came on the heels of a slowed quarter for Arkansas Best.

It’s revenue during the last quarter dropped 1.9 percent to $42 million. G.I. cost Arkansas Best more to run since its 99.3 percent operating ratio had increased from 95.7 during the previous quarter.

“The cash from this sale will allow us to make further reductions to our outstanding debt,” said Arkansas Best CEO Robert A. Young III. The company expects an after-tax gain of between 12-14 cents per share.

David Humphrey, Arkansas Best’s director of investor relations, said a strong economy and favorable pricing environment fueled last year’s success. He said top subsidiary ABF Freight System Inc., a less-than-truckload carrier, was an especially bright spot in 2000.

Its 90.3 percent operating ratio meant the company made a dime on every dollar ABF generated. That was an improvement from 91.6 percent in 1999. The subsidiary increased its revenue 25 percent from $107 million in 1999 to $133.8 in 2000.

J.B. Hunt Transport Services Inc., of Lowell, Baldor Electric Co. of Fort Smith and Brass Eagle of Bentonville were the only other firms that increased profits year-over-year. Superior Federal Corp. of Little Rock, which owns Fort Smith-based Superior Federal Bank, also had an increase.