Swift profits rebound in Q3 despite declining revenues

Trucking and intermodal carrier Swift Transportation grew net income 4.7 percent year-over-year to $38 million in third quarter 2016 on revenues that slipped 4.9 percent to $1.01 billion compared with the same 2015 period.    Truckload giant Swift Transportation Co. grew its profits in the third quarter of 2016 despite declining revenues, according to the company’s most recent unaudited financial statements.
   The Phoenix-based trucking and intermodal carrier grew its net income 4.7 percent to $38 million compared with third quarter 2015. Diluted earnings per share (EPS) stood at $0.28 per share compared with $0.25 per share the previous year.
   Swift’s revenues slipped 4.9 percent year-over-year to $1.01 billion for the quarter.
   For the first nine months of 2016, Swift posted earnings of $112.8 million on revenues of $2.92 billion, year-over-year decreases of 9.8 percent and 4.7 percent, respectively. Diluted EPS stood at $0.83 per share compared with $0.87 per share in the same 2015 period.
   The company cited a “challenging” truckload freight market characterized by excess capacity and customer inventories, as well as sluggish demand that have put continued downward pressure on freight volumes and pricing as the primary cause of the earnings decline.
   Swift’s truckload segment saw revenues slide 6.5 percent year-over-year to $516.7 million for the third quarter of 2016 and 7.7 percent to $1.01 billion for the first half.
   As part of a continuing effort to offset external industry factors, Swift said it implemented several cost control and efficiency improving countermeasures, including “right-sizing” its core fleet to drive improvements in asset utilization, increasing its participation in the spot market to improve network balance, and focusing on driver safety and satisfaction.
   Revenues for dedicated contract carriage, on the other hand, ticked up 6.1 percent to $248.8 million in the third quarter.
   Central Refrigerated Service, Swift’s reefer unit, saw revenues tumble 8.6 percent to $85 million and intermodal revenues likewise dropped 8.6 percent to $92.3 million during the same period.
   “Cost control remains a key focus,” Swift said of the results. “As we mentioned last quarter, these endeavors include: streamlining processes, headcount reductions, postponement of non-critical system implementations, and reducing expenditures. Our resolved commitment to cost reduction within our Intermodal segment has allowed the segment to produce similar year-over-year operating ratio results while year-over-year Load Counts decreased by approximately 3,300 loads.”
   The company in September announced the retirement of Founder and Chief Executive Officer Jerry Moyes, effective Dec. 31,2016.
   Moyes will be succeeded by Richard Stocking, a 25-year Swift veteran who has served as president and chief operating officer of the company since July 2010.
   “The entire Swift organization is grateful and appreciative of Jerry and the Moyes family for the incredible opportunity they have created for countless employees, customers, and suppliers to Swift during his tenure,” the company said. “Jerry’s contribution has been immense and his influence will be forever felt.”