Lower costs boost first quarter margin even with lower revenue | Apr 28, 2011 4:16PM EDT
Intermodal service provider Pacer International posted net income of $2 million in the January-March period, up from a $500,000 loss in the 2010 quarter.
Pacer pulled in less overall revenue at $358.4 million, down 1.5 percent, but boosted its gross margin 3 percent to $42.1 million as its recorded lower costs for purchased transportation in its logistics operation plus some marketing and administrative expense.
Its mainstay intermodal service pulled in 5.8 percent higher revenue at $280 million, while logistics receipts fell 21 percent to $79 million.
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U.S. IMC Intermodal Yield
Pacer once was a major wholesaler of low-rate train space to other intermodal marketing companies under a long-term contract with Union Pacific Railroad. But UP and Pacer restructured that deal and Pacer now mainly handles containers for large retail customers.
Daniel W. Avramovich, chairman and CEO of Pacer, said with the first quarter results “we continued to make progress in achieving our strategic objectives” as a global door-to-door transportation and logistics provider. He said Pacer in this period “increased customer service and quality, despite some difficult operating conditions with weather and rising fuel costs.”
-- Contact John D. Boyd at jboyd@joc.com. Follow him on Twitter @jboydjoc.
