INDUSTRY NEWS

Indicators: Truck tonnage reveals ‘really strong’ freight market (from Commercial Carrier Journal December 20, 2017)
James Jaillet| | December 20, 2017

CCJ‘s Indicators rounds up the latest reports on trucking business indicators on rates, freight, equipment, the economy and more.

ATA Truck Tonnage Index ChartThe amount of freight moved by the for-hire trucking industry in November, as measured by the  American Trucking Associations’ For-Hire Truck Tonnage Index, jumped again, gaining 2.3 percent from October and 7.6 percent from last November.

Year-to-date, compared with the same eleven months in 2016, the index is up 3.5 percent.

“The freight market is really strong,” said ATA Chief Economist Bob Costello. “The solid truck tonnage figures over the last four months suggest to me that this holiday spending season might be better than many expected, and the best in several years. The strength in tonnage also shows that other parts of the economy are doing well, too, including business investment, factory output, and even construction.”

 

Indicators: Spot market activity soars as freight, rates jump; shippers fear big rate increases ahead (from Commercial Carrier Journal)

CCJ‘s Indicators rounds up the latest reports on trucking business indicators on rates, freight, equipment, the economy and more.

DAT North American Freight IndexSpot market freight, rates set for take off: Freight availability on the spot market in September gained big both month to month and year over year, according to data released last week by loadboard DAT Solutions. The gains were driven by the typical seasonal uptick in freight activity seen in September as well as the disruptions caused by hurricanes Harvey and Irma, DAT says.

Available loads on DAT’s loadboard were 74 percent higher than the same month last year, DAT reported.

The dry van segment in particular saw major gains, with freight activity climbing 15 percent from August and up 80 percent from September 2016. Rates, meanwhile, gained 19 cents a mile from August and were up 35 cents from last September, DAT reported. The load-to-truck ratio hit 6.6 to 1 — the highest average in 8 years.

Reefer demand grew 4 percent from August and 70 percent from last September, pushing rates up 15 cents from August. DAT says harvest season in the pacific northwest and upper midwest, as well as late harvests in California, drove the segment’s surge.

The number of flatbed loads grew 3 percent from August. Though flatbed freight activity typically declines in September, recovery and rebuilding efforts in storm-stricken areas helped boost the segment this year, DAT says. Rates in the segment climbed 8 cents in September.

DAT says it expects the elevated spot market activity to continue at least until February.

FTR Chart‘Trucking Conditions’ modest in August, but ‘significant changes’ loom: Though FTR’s monthly Trucking Conditions Index shows only a modestly positive reading for market conditions for fleets, it’s “not wholly reflective of the current environment for truckers,” the firm notes.

Though market tightness has prompted a flutter of spot market activity in recent months — and driven rates higher on the spot market — such capacity constraints have yet to affect the contract pricing market, on which FTR bases its monthly index. Likewise, disruptions from major hurricanes Harvey and Irma will affect industry capacity and rates, but those changes won’t be seen until FTR releases its September reading.

“The truck market is currently in the middle of a significant change in conditions,” says FTR Chief Operating Officer Jonathan Starks. “While the recent weather events made it feel like it happened all at once, spot markets have actually been moving in this direction for the past year. Load activity was rising, truck availability was falling, and rates were already up 20 percent year over year before the storms hit. Spot market rates are a leading indicator. And, although there is a lag, contract markets are starting to follow suit. Shippers are now taking notice and are getting worried about dealing with double-digit rate increases as we head towards bid season.”

FTR bases its index reading on a variety of key market factors affecting trucking companies, including freight volume, freight rates, fleet capacity, fuel prices, fleet bankruptcies and more.

Carriers saw declining revenues, profits in first half of 2017

(article from Commercial Carrier Journal)

Revenue and income for some of the country’s largest carriers, as reported over the last few weeks in their public quarterly earnings reports issued to shareholders, dipped in the first half of 2017 compared to the same period last year.

Most of the carriers who file quarterly earnings statements, some of the country’s largest trucking companies, reported increased operating expenses, mostly stemming from fuel, maintenance and employee salaries and benefits. Expenditures on so-called purchased transportation, that is hiring on owner-operators or small carriers to move loads, also rose for most of the country’s publicly traded carriers.

 2016 was a rocky year for the many carriers, due to cheap freight rates and, at times, sluggish freight movement. Several of the same carriers listed below reported declines in revenue and profits in 2016 compared to the year prior. Those conditions, at least according to the reports filed this month and last, appear to be lingering.

The numbers below are for January-June of both years.

Covenant Transportation

Gross revenue

2017: $323 million

2016:  $315.1 million

EBIDTA

2017: $44 million

2016: $47.6 million

Net Income

2017: $1.5 million

2016: $7.4 million

Diluted earnings per share:

2017: 8 cents/share

2016: 20 cents/share

Heartland Express

Gross revenue

2017: $259.5 million

2016: $323.6 million

Net Income

2017: $40.7 million

2016: $44.8 million

Diluted earnings per share:

2017: 34 cents/share

2016: 37 cents/share


J.B. Hunt

Gross revenue

2017: $3.012 billion

2016:  $291 billion

Net Income

2017: $313 million

2016: $343.7 million

Diluted earnings per share:

2017: $1.80/share

2016: $1.80/share


Knight Transportation

Gross revenue

2017: $544.4 million

2016: $548.4 million

Net Income

2017: $32.8 million

2016: $47.9 million

Diluted earnings per share:

2017: 40 cents/share

2016: 59 cents/share


Landstar Systems

Gross revenue

2017: $1.651 billion

2016: $1.487 billion

Net Income

2017: $69.9 million

2016: $61.5 million

Diluted earnings per share:

2017: $1.66/share

2016: $1.45 /share


Marten Transportation

Gross revenue

2017: $344.7 million

2016: $328 million

Net Income

2017: $17.4 million

2016: $16.7 million

Diluted earnings per share:

2017: 23 cents/share

2016: 56 cents/share


P.A.M Transportation

Gross revenue

2017: $218 million

2016: $215.1 billion

Net Income

2017: $3.89 million

2016: $6.92 million

Diluted earnings per share:

2017: 61 cents/share

2016: $1.01 /share


Swift Transportation

Gross revenue

2017: $1.956 billion

2016: $1.978 billion

EBIDTA

2017: $216 million

2016: $269 million

Net Income

2017: $31.5 million

2016: $74.8 million

Diluted earnings per share:

2017: 23 cents/share

2016: 56 cents/share


USA Truck

Gross revenue

2017: $209 million

2016: $$220.5 million

Net Income (loss)

2017: ($7.7 million)

2016: ($3.2) million

Diluted earnings (loss) per share:

2017 (2Q): (96 cents)/share

2016 (2Q): (35 cents)/share


Werner

Gross revenue

2017: $1.021 billion

2016: $981.4 mllion

Net Income

2017: $39.2 million

2016: $38.4 million

Diluted earnings per share:

2017: 54 cents/share

2016: 53 cents/share