Fort Smith-based trucking and logistics company ArcBest reported record profits Friday that greatly exceeded analysts' estimates along with revenue that was up more than 60% when compared with the year-ago period.
The company reported net income of $69.6 million, or $2.68 a share, for its first quarter of fiscal 2022 compared with $23.4 million, or 87 cents per share, for the same quarter in fiscal 2021. A consensus of 10 analysts had called for profits of $2.15 a share, according to Yahoo Finance.
Revenue for the first quarter was $1.34 billion, up $506 million when compared with $828.2 million in revenue for the year-ago period. An average of seven analysts had predicted revenue of $1.26 billion, according to Yahoo Finance.
During a conference call with analysts on Friday, Judy R. McReynolds, ArcBest's chairman, president and chief executive officer, said the company improved operating margins across all its operations for the quarter and credited the hard work of the company's employees as a key element to ArcBest's ongoing success.
The company released its earnings before the markets opened. ArcBest shares closed at $72.16, down $4.27, or nearly 6%, in trading Friday on the Nasdaq exchange. Shares have traded as low as $52.86 and as high as $125 over the past year.
ArcBest's asset-based business, which consists of ABF Freight, booked revenue of $705.3 million for the first quarter, up from $556.3 million for the year-ago quarter, a per-day increase of nearly 26%. Operating income was $80 million, up from $30.1 million in the year-ago period. The company reported total tonnage per day was up 3.6%, which included a nearly 1% increase in the less-than-truckload-rated weight per shipment, and billed revenue per hundredweight was up 21.1%, helped by higher fuel surcharges.
According to the U.S. Energy Information Administration, for the week ending April 22, the average price of on-highway diesel fuel stood at $5.16 a gallon, up nearly 6 cents from the previous week and up $2.036 from same period a year ago.
The American Trucking Associations For-Hire Truck Tonnage Index was up 2.4% in March after rising 0.7% in February, according to a release earlier this month. March was the eighth straight month-to-month improvement of the index.
"During the first quarter, the index rose 2.4% from the final quarter of 2021 and increased 2.6% from a year earlier," American Trucking Association's Chief Economist Bob Costello said in a statement. "While there might be some recent softness in the spot market, for-hire contract freight tonnage remains solid and is only limited by lack of capacity -- both drivers and equipment -- at contract fleets."
ArcBest's asset-light business, which covers logistics, transportation management and household goods moving services, posted revenue of $673.7 million compared with $311.5 million for the year-ago period, a per-day gain of 114.6%. Operating income was $22.8 million, up from $9.3 million for the same quarter last year. The quarter includes the addition of truckload brokerage firm MoLo Solutions, which ArcBest acquired in the fourth quarter of 2021.
During the conference call, ArcBest executives said the integration of MoLo was in its first stages and going well. MoLo is expected to be fully integrated by the end of the year. The company also said its efforts to hire staff, including 20 hiring events nationwide, resulted in the addition of 600 new employees.
On Thursday, ArcBest said its board of directors reauthorized its common stock repurchase program, increasing the total amount available to $75 million. It also said the company will increase in its quarterly cash dividend to 12 cents per share.