In spite of lagging returns from its logistics segment, Knight Transportation posted another strong third quarter Wednesday, fueled by strong results in its trucking division and brokerage business.
Knight’s consolidated operating ratio in the quarter, a measure of profitability, did rise up to 82.8 from 82.5 during the same period last year. Nevertheless, net profit at the Phoenix, Arizona-based firm was once again up, some 20.6 percent year-over-year in the third quarter at $30.28 million. Revenue, too, was up some 10.5 percent year-over-year at roughly $300 million.
“Both our trucking and logistics segments continue to contribute to our growth as we continue to enhance our logistics capabilities to meet the supply chain needs of our customers,” Dave Jackson, president and CEO, said in a statement.
Despite a less robust freight environment, Knight continued to experience positive results from efforts to improve yield, the company said. In the last quarter, the trucking segment achieved an adjusted operating ratio of 79.8 percent compared to 79.6 percent from the same quarter last year. Adjusted net income from the firm’s trucking segment jumped 20.3 percent in the third quarter to $42.71 million. Total revenue from Knight’s trucking business was up 21.6 percent for the same period of time, at $211.8 million.
Average revenue per tractor, excluding fuel surcharge, increased 1.8 percent year-over-year to $43.86 million. The company attributed the uptick to a 4.6 percent improvement in revenue per loaded mile, a 2.6 percent increase in length of haul, off-set by a 0.2 percent decrease in average miles per tractor, as well as an an increase in non-paid empty mile percentage.
“Our improvements in our revenue per tractor were partially offset by increased salaries and wages, increased driver recruiting and hiring costs, and rising equipment prices,” the company said.
Knight’s logistics segment did not perform as well. Operating income in the segment fell 13.1 percent year-over-year in the third quarter to $3.72 million.
Due to lower fuel surcharge and a shorter length of haul, however, the company’s brokerage business, the largest component of its logistics segment, was able to increase revenue 11.7 percent year-over-year and operating income 8.8 percent.