William B. Cassidy, Senior Editor | Jan 26, 2012 2:13PM EST
Knight Transportation plans to add capacity in 2012, expanding its fleet and services while raising truckload rates 3 to 4 percent, company officials said.
“We will work diligently to grow the fleet” as the economy expands, Kevin P. Knight, chairman and CEO of the Phoenix-based carrier, told analysts Wednesday.
“We plan to grow the fleet 4, 5, 6 and if we’re really lucky maybe 7 percent,” Knight said. “As long as we can continue to improve productivity and rate structure.”
That means maintaining a balance between tractor-trailer utilization and pricing. “Price does drive utilization to some degree,” he said. “We have to find that right mix to make sure we don’t slow things down in our network and get the rate we need.”
Knight Transportation increased net profit 22.7 percent in the fourth quarter to $17.5 million, as the truckload carrier’s revenue per tractor rose 6.8 percent. Total revenue, including fuel surcharges, increased 19 percent to $224.1 million.
For the full year, Knight’s net profit grew a more modest 2 percent to $60.2 million on an 18.5 percent increase in total revenue to $866.2 million. The solid fourth quarter gain put Knight earnings back on the high road after net profit dipped slightly year-over-year in the third quarter to $16.6 million.
Knight pulled more profit out of less revenue in the last quarter than in the third quarter, when its total sales increased 18.4 percent to $227.1 million.
“So far in the first quarter we’re off to a stronger start than a year ago, especially in the West … The economy is making ever so slight improvements,” he said.
“When the economy really strengthens, the irregular route truckload industry should really boom again,” Knight said.
-- Contact William B. Cassidy at wcassidy@joc.com. Follow him on Twitter @wbcassidy_joc.