Tightening truck capacity helped boost second quarter revenue at Heartland Express, while the cost of purchasing new trucks slimmed its profit.
The truckload carrier's operating revenue climbed 8.9 percent to $127.4 million, while its net income dropped 5.5 percent from a year ago to $16.7 million.
That's a 40.3 percent increase in profit from the first quarter, however. Heartland improved its operating ratio from 86.3 in the first quarter to 82.7. Sales increased 10.2 percent from Heartland's $115.6 million in first quarter revenue.
Heartland attributed the year-over-year drop in net income to a decrease in gains on the disposal of property and an increased depreciation expense for new trucks.
The company purchased an undisclosed number of new tractors in 2009. It recently ordered additional 2010-model-year Class 8 International tractors from Navistar.
The average age of Heartland's tractors was 1.8 years as of June 30. "This is one of the newest and most fuel efficient fleets in the industry," the company said.
The trucks - replacement vehicles - will help Heartland save money by conserving fuel and position it to expand as freight demand increases.
Freight demand still lags the pre-recession levels of 2007, the company said, though it's higher than a year ago. Heartland said truckload freight rates have "stabilized."
-- Contact William B. Cassidy at email@example.com.