Truckload carrier Heartland Express improved its profitability in the third quarter, reporting what looks almost like a railroad operating ratio: 77.2.
The North Liberty, Iowa-based carrier had net income of $18.3 million on $127.2 million in operating revenue, posting a 14.4 percent net profit margin.
Its profit increased 9.6 percent from the second quarter of 2010 and 26.1 percent from the year-ago quarter. Its revenue increased 12.2 percent from a year ago.
By The Numbers: U.S. Truck Shipping Costs.
Heartland's revenue slipped by about $200,000 from the second quarter, however, according to company reports, an indication of a softening freight market.
Freight demand has leveled off from the second quarter, the company said, and lags "dramatically behind" the level of demand in 2007, prior to the recession.
The company improved its bottom line despite a softening market. In the second quarter, Heartland's operating ratio was 82.7 and its net margin 13.1 percent.
Freight rates are increasing and appear to be stabilizing, the company said. "The company continues to focus on improving utilization and cost controls."
Heartland continued replacing its older trucks, purchasing 200 2011-model-year ProStar International Class 8 tractors from Navistar in the third quarter.
The average age of Heartland's truck fleet dropped to 1.6 years by the end of September, compared with an estimate of 6.5 years for the nation's truck fleet.
It also expects to purchase 600 new Great Dane trailers by the end of the year.
The new power units and trailing equipment will help position the carrier for expansion and reduce fuel and maintenance costs, Heartland said.
-- Contact William B. Cassidy at email@example.com.