UPS Freight increased its revenue 19 percent to $660 million in the second quarter, improving its revenue per hundredweight and profitability, the company said.
The industrial trucking unit of package delivery giant UPS improved its revenue per hundredweight, or yield, 11.2 percent over the same quarter last year. Higher yield signals increases in both fuel surcharge revenue and LTL rates. UPS will raise its non-contract rates and accessorial charges 6.9 percent Aug. 1.
The nation’s fourth-largest less-than-truckload carrier is building on its performance in 2010, when it increased revenue 13.6 percent to $2.2 billion. UPS Freight increased its revenue 9.4 percent from $604 million in the first quarter, though the rate of year-over-year expansion dropped from 22.8 to 18.9 percent.
The gross weight hauled by the carrier increased 6.2 percent, possibly indicating more shippers are converting truckload freight to LTL as capacity tightens. As a unit of UPS Supply Chain Services, the Richmond, Va.-based carrier doesn’t release a separate profit statement, but its higher yield benefited its parent.
Almost 70 percent of the $151 million year-over-year second quarter gain in revenue at Supply Chain Services came from the LTL trucking operation. The SCS division increased its revenue 7 percent from a year ago to $2.3 billion while its operating profit increased 77 percent to $235 million.
Contact William B. Cassidy at email@example.com. Follow him on Twitter at @wbcassidy_joc