ArcBest Corp (NASDAQ: ARCB) reported adjusted earnings per share (EPS) of $0.67, well ahead of the break-even consensus estimate.
The asset-based division, which includes less-than-truckload (LTL) operations, reported a 17.8% year-over-year revenue decline to $460 million. Tonnage was down 13.8% with revenue per hundredweight, or yield, declining 4%. LTL yield was up in the low-single digit percentage range excluding fuel surcharge revenue. The division posted a 94.4% operating ratio, 140 basis points worse year-over-year. Prior cost actions and a reliance on spot truckload (TL) and LTL helped ease the demand degradation caused by COVID-19.
The company’s asset-light division reported a 15% year-over-year revenue decline as lower demand due to the pandemic weighed on expedited and brokerage transactions. Declines in the auto and manufacturing sectors were headwinds for expedited freight demand.
ArcBest’s net cash position improved $44 million since the end of first quarter 2020 and the company is reviewing options for repayment of recent borrowings undertaken in the early stages of the outbreak. The company reported that payment trends from its customers have stabilized.
July revenue is down only 3% year-over-year. The company plans to restore previous cost cutting – suspension of its 401k matching contributions, a 15% cut to non-union employee salaries and reduced payments to board members – that contributed $15 million in savings during the second quarter. The sequential cost increase is expected to be $10 million to $15 million in the third quarter.
“As an essential business, our employees have worked on the front lines in sacrifice, both personally and financially, to serve our customers and our nation. We value our employees and appreciate their efforts, and are pleased to now be able to restore full wage levels,” said ArcBest Chairman, President and CEO Judy McReynolds.
The company will host a conference call to discuss these results with analysts and investors at 9:00 a.m.