Pricing Holds Despite LTL Revenue Drop
The nation’s most successful and well-known less-than-truckload carriers couldn’t stave off a revenue slip as the US economy continued to prove problematic for the freight transportation industry. While truckload carriers experienced the brunt of the decline in revenue, tougher conditions also affected LTL carriers as well.
While FedEx Freight enjoyed 2 percent increased revenue in the previous quarter, this is the largest name in the market. The others have reported less-than-optimal results in spite of efforts to stay productive in the weakening freight economy. While XPO Logistics is also a well-known name in the LTL market, the carrier hasn’t reported their data yet (but will do so on August 4th).
The publicly owned LTL market experienced slips as well, with Old Dominion Freight Line dropping 0.9 percent and Roadrunner Transportation Systems toppling by 11.9 percent. This type of decline is troubling, even considering the industry-wide trend of lower volumes and revenue.
The declining profits across the sector are also cause for concern. ABF Freight Systems experienced a 38 percent drop in operating profit year-over-year. Saia reported a 31 percent drop in net profit, while Roadrunner LTL’s operating profit plummeted by 91 percent from the second quarter of 2016.
However, not every carrier has reported similar results. A 26.2 percent increase in operating profit was enjoyed by YRC Freight. This brought the total to an impressive $28.4 million. “YRC Freight most interestingly improved productivity on the dock, on the street and in linehaul in spite of a decline in network volumes,” Stifel managing director David G. Ross said in an investor note. YRC Worldwide’s net profit rose 4.2 percent to $27.1 million.