Truckload (TL) carrier Schneider National (NYSE: SNDR) reported second quarter 2020 adjusted earnings per share (EPS) of $0.26, $0.07 better than consensus but $0.08 lower year-over-year.
“Of our various segments, Intermodal was most negatively impacted by the pandemic while the impact to Truckload and Logistics was proportionately less. Volumes improved as the quarter progressed, and our cost containment actions helped mitigate the earnings impact of the challenging market,” stated CEO and President Mark Rourke in the company’s Thursday, July 30, press release.
TL revenue declined 15.7% year-over-year to $451 million as revenue per truck per week declined 4.3%. The closure of its final-mile unit presented a revenue headwind along with lower volumes and pricing. Schneider reported an improvement in volume as the quarter progressed with June ending near 2019 levels.
The division’s operating ratio (OR) deteriorated 200 basis points to 91% excluding the impacts from the final-mile unit. Declines in driver recruiting, maintenance and fuel expenses helped offset the revenue decline.
Intermodal revenue fell 15.7% year-over-year with orders down 13% and revenue per order down 6.3%. An imbalanced network from weak Asia imports and the closure of non-essential retail were cited as the reasons for the decline. A mix shift to favor East Coast ports reduced the average length of haul, driving revenue per load lower. The division reported 680 basis points of OR erosion to 95%.
The carrier reinstated full-year 2020 earnings guidance to a range of $1.10 to $1.25 per share. The new guidance is higher than the current consensus estimate of $1.05 but below the original $1.25 to $1.35 per share range.
“This guidance assumes a continued and gradual improvement in overall operating conditions from increased demand and tighter capacity along with sequential improvement in Intermodal margins as balance is restored in the network over the second half of the year,” concluded Rourke.
The company will host a conference call to discuss these results with analysts and investors today at 10:30 a.m. EDT.
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