A “challenging” driver market will put more pressure on trucking costs, capacity and pricing in 2012, says truckload carrier Werner Enterprises.
The driver market tightened in the fourth quarter of 2011, the Omaha-based company said Thursday. Difficulty hiring enough truck drivers kept Werner’s capacity slightly below its target level of about 7,300 trucks in the latter part of 2011, the company said when announcing its fourth-quarter and full-year earnings and revenue.
“Assuming the domestic economy strengthens in 2012, we anticipate the driver market will become even more challenging,” the company said in a statement. However, Werner believes its short-haul and regional routes will attract drivers.
Any lack of drivers didn’t slow Werner much last year. The company’s net profit jumped 28 percent to $102 million in 2011 — the first time annual profit exceeded $100 million in the carrier’s history. Total revenues rose 10 percent to $2 billion.
For the last quarter, Werner reported a 22 percent increase in net profit to $29.4 million, while revenue rose 10 percent to $507.9 million. In 2010, Werner was the third-largest truckload carrier in the U.S., according to SJ Consulting Group.
“Our freight demand progressively improved from September to December, before the normal seasonal decline” in mid-December, Werner said. Contractual rate increases and a better freight mix boosted average revenue per mile 4.6 percent.
Average revenue per total loaded miles jumped even higher, by 5.4 percent, in the fourth quarter. Total mileage dropped 4 percent and trip length 1.6 percent.
Diversification into value-added services such as brokerage, freight management, intermodal rail and global logistics boosted revenue. While trucking sales were flat in the quarter at $329.1 million, VAS sales rose 33 percent to $79.7 million.
“We continue to diversify our business model with the goal of achieving a balanced portfolio of revenues comprised of one-way truckload, specialized services and logistics,” the company said. Nearly half its truck fleet is in dedicated service.