J.B. Hunt Transport Services, Inc., announced first-quarter total operating revenue was $797 million, a 2% increase from the $780 million for the first quarter of 2006.
The increase in operating revenue was primarily attributable to growth in Intermodal, Dedicated Contract Services (DCS) and Integrated Capacity Solutions (ICS) segments. The combined tractor fleet grew from 11,925 in the first quarter of 2006 to 11,971 in the first quarter of 2007. Containers and trailers grew from 50,215 to 54,814 over the same period. The growth in the fleet was to support additional intermodal and dedicated business.
Operating income for the current quarter declined slightly to $80.4 million vs. $81.4 million for the first quarter of 2006. Net interest expense increased significantly from $500,000 in the first quarter of 2006 to $7.4 million in the first quarter of this year, primarily due to higher levels of debt. These increased borrowings were related to purchases of revenue equipment and treasury stock.
“During the first quarter of 2007, we experienced softer freight volumes in our Truck and Integrated Capacity Solutions segments, harsh winter weather that negatively impacted all our segments in February, the adoption of FIN 48 that resulted in a higher effective income tax rate and additional interest expense, and the write-off of unamortized fees from re-negotiation of previous credit facilities. Despite those significant obstacles, we still produced an operating ratio under 90% and diluted EPS of 30 cents, which represents the second best EPS performance for a first quarter in our history,” said Kirk Thompson, JBHT President and CEO.