U.S. Xpress (NYSE: USX), a Chattanooga-based truckload carrier, reported adjusted earnings per share of $0.15 compared to the consensus estimate of $0.18.
USX reported operating revenue of $415.4 million for the quarter, a 2.4 percent decline year-over-year. Revenue adjusted to exclude fuel surcharges and the company’s discontinued operations in Mexico increased $2.9 million in the period. Adjusted operating income was 8 percent higher at $16 million. The adjusted operating ratio (OR) improved 40 basis points to 95.7 percent.
“We were pleased to deliver our seventh consecutive quarter of year-over-year adjusted operating income improvement and the highest earnings of any first quarter in our company’s history,” said U.S. Xpress’ President and Chief Executive Officer Eric Fuller.
“Looking to the balance of 2019, we remain positive as we expect the freight environment to improve seasonally, our network efficiency to rise as we complete the repositioning of equipment from cross-border lanes and the productivity of our operations to benefit from our many internal initiatives including our goal of achieving a frictionless order,” continued Fuller.
Average revenue per tractor per week increased 1.1 percent year-over-year to $3,762 in the truckload (TL) segment. Average revenue per mile increased 3.8 percent to $2.13 with a 2.5 decline in average revenue miles per tractor. The TL division reported a 20 basis point (bp) improvement in operating ratio (OR), which was 96 percent. The company said that its spot exposure, 20 percent, in its over-the road division created rate and revenue mile headwinds.
USX’s average tractor count was up 30 trucks to 6,275 units. The over-the-road division’s truck count declined five units while the dedicated division increased its truck count by 35 trucks. Over-the-road average revenue per truck per week declined 6 percent as average revenue per mile increased 0.7 percent year-over-year. Dedicated reported an 11.8 percent increase in average revenue per truck per week with a 7.1 percent increase in average revenue per mile.
The brokerage division reported a 15.2 percent revenue decline year-over-year to $46.2 million as load counts declined 13.8 percent. Gross margins expanded 350 basis points to 17.5 percent. Operating income increased 18.9 percent to $2.8 million in the quarter as higher gross margins were driven by lower transportation costs per load and improved third-party capacity sourcing.
USX said that given the subdued freight market compared to 2018, it now expects the second quarter 2019 OR will deteriorate year-over-year. However, the company believes that the full year adjusted operating ratio goal of 93 percent is still possible. However, it will wait for better market visibility before updating its OR guidance.
USX will hold a call to discuss these results with analysts and media at 5:00 p.m. EDT.