Heavy Duty Trucking, January 2021
HDT JANUARY 2021 16 WWW TRUCKINGINFO COM T he third quarter of 2020 marked a turn in fundamentals for many freight companies After a second quarter saw real gross domestic product plunge 314 the 331 increase in the third quarter resulted in a year over year GDP figure closer to 26 The quarter saw an aggressively rebounding freight volume environment likely the result of carrier capacity reductions inventory restocking by retailers and a surge in necessity shipping of food beverage and healthcare related items Business inventory levels appeared to be coming down at a 6 rate as of the end of the third quarter but retail inventories were declining at a rate closer to 12 Despite some of the most dramatic shortterm third quarter swings in freight demand financial results for most freight and logistics companies were better than expected Even with lower revenue the publicly traded companies we track saw better operating margins largely the result of lower fuel labor and purchased transportation costs and a sharp rebound in volumes caused in part by an inventory build among retailers In the pure truckload segment we saw profits consistently beating expectations for the second consecutive quarter Average operating profit margins for the companies weve tracked in the accompanying table jumped to 101 the highest we have seen since 2018 There was an average 13 revenue decline the average fleet dropped by 97 but drove more miles per truck and was paid 09 more in terms of average revenue per mile But revenue per mile improved fleet growth slowed truck utilization improved meaningfully from last quarter and empty mile ratios improved by 09 to 121 better than we would have expected given the wild swings in the economy In dedicated truckload although the data is not robust there are some interesting observations Median revenue growth was the strongest among trucking segments at 11 but it continued to slow while other areas improved Average operating profit Third quarter financial results for most freight and logistics companies were better than expected How did wild third quarter swings affect fleet earnings SOURCE COMPANY REPORTS TAHOE VENTURES LLC Behindthenumbers UNDERSTANDING TRUCKINGS ECONOMIC INDICATORS Jeffrey Kauffman Contributing Economic Analyst jkauffman@ truckinginfo com How selected public carriers performed in the third quarter
You must have JavaScript enabled to view digital editions.
