Watch Now

Old Dominion sees tonnage accelerate from August inflection

Second carrier to report improving LTL metrics in Q4

LTL trends step higher in Q4 (Photo: Jim Allen/FreightWaves)

Improvement in less-than-truckload fundamentals was reported for a second day in a row on Thursday. Old Dominion Freight Line’s (NASDAQ: ODFL) November update showed the carrier increased revenue per day by more than 6% for the month.

The report follows a Wednesday update from Saia (NASDAQ: SAIA) in which the carrier reported tonnage increases for the first two months of the fourth quarter of 5.7% and 7.3%, respectively.

Old Dominion reported a 5.2% year-over-year increase in November tonnage with weight per shipment and total shipments increasing equally. The tonnage increase was mostly responsible for a 6.3% climb in revenue per day, with revenue per hundredweight, or yield, only advancing modestly.

Through the first two months of the fourth quarter, the carrier reported that yield is up 0.5% year-over-year, 3.8% higher excluding fuel surcharges.

“Old Dominion’s revenue results for November include increases in both our volumes and yield. The increase in tonnage reflects the additional demand for our industry-leading service as well as further improvement in the domestic economy,” stated President and CEO Greg Gantt in the press release.

The company previously provided October results in its third-quarter filing. Revenue for the month was up 2.6% year-over-year, the combination of a 2.2% increase in tonnage and a 0.3% increase in yield. Yield was up 3.5% excluding fuel.

The manufacturing segment can represent more than 80% of total tonnage for some LTL carriers and the data points are representative of a recovering industrial economy. The Purchasing Managers’ Index remained in expansion territory for the sixth consecutive month in November at 57.5% and industrial production increased 1.1% during October.

“Although there continues to be risk to the economy associated with the pandemic, we are increasing the capacity of our team to prepare for anticipated growth,” Gantt concluded.

Click for more FreightWaves articles by Todd Maiden.

Todd Maiden

Based in Richmond, VA, Todd is the finance editor at FreightWaves. Prior to joining FreightWaves, he covered the TLs, LTLs, railroads and brokers for RBC Capital Markets and BB&T Capital Markets. Todd began his career in banking and finance before moving over to transportation equity research where he provided stock recommendations for publicly traded transportation companies.