Truckload carrier Knight Transportation (NYSE: KNX), reported revenue and earnings for the second quarter ended June 30, 2009. Highlights include:
* Operating income of $20.8 million, an increase of 0.3% compared with the second quarter of 2008.
* Revenue before fuel surcharge of $144.3 million, a decrease of 6.8% compared with the second quarter of 2008.
* Diluted earnings per share of $0.15 vs. $0.15 in the second quarter of 2008.
For the quarter, revenue before fuel surcharge decreased 6.8%, to $144.3 million from $154.8 million. Primarily due to decreased fuel surcharge revenue, total revenue decreased 21.4%, to $162.1 million from $206.1 million for the same quarter of 2008. The U.S. average cost of diesel fuel during the second quarter was $2.34 compared to $4.42 in the second quarter of 2008. Operating income in the quarter of $20.8 million represented a 0.3% increase over the $20.7 million reported in the second quarter 2008. Net income decreased 1.0% to $12.6 million from $12.7 million for the same period of 2008. Net income per diluted share for the quarter was $0.15, compared to $0.15 for the same period of 2008.
Year-to-date, revenue before fuel surcharge decreased 6.3%, to $277.4 million from $296.1 million for the same period of 2008. Operating income increased 2.0% to $40.2 million from $39.4 million for the same period of 2008. Net income increased 0.8% to $24.3 million from $24.1 million in the same period of 2008. Net income per diluted share was $0.29 compared to $0.28 for the first half of 2008.
“Although the challenging freight environment continued in the second quarter, we did experience an increase in seasonal demand as the quarter progressed,” says Kevin Knight, chairman and chief executive officer. “Our multiple-truckload service offerings continue to enable us to grow our market share and increase our loads hauled which were up 5.5%, year-over-year. This quarter’s performance is a further demonstration of the flexibility of our decentralized business model and ability to adjust and adapt to market conditions.”
The carrier reported equipment productivity, as measured by average revenue per tractor in the quarter, was down 8.1% from the year-ago period. Non-paid empty mile percentage increased to 11.7% from 11.2% in the year ago period, reflecting weak freight demand. Average length of haul decreased to 474 miles from 525 miles in the same period last year.
“We have not yet seen evidence that would suggest strong improvements in demand are on the horizon,” Knight says. “However, we have seen evidence that many truckload carriers are barely viable and are plagued with weak balance sheets, aging fleets and dramatically shrinking revenues. We expect the challenging truckload market to yield opportunities to continue to capture market share over time. We believe we are well positioned to navigate the challenges of the current environment and thrive as the market improves when truckload capacity decreases and/or freight demand modestly increases.”