Old Dominion Freight Line reports 25% increase in revenue for third quarter
Old Dominion Freight Line, Inc. has announced its financial results for the third quarter ended September 30, 2011. Revenue was a record $494.5m for the quarter, an increase of 24.9% from $396.0m for the third quarter of 2010. Net income increased 58.4% to $38.6m from $24.4m for the third quarter of last year. Old Dominion’s operating ratio improved to a record 86.2% for the third quarter compared to 89.0% for the third quarter of 2010.
For the first nine months of 2011, revenue increased 29.1% to $1.40bn from $1.08bn for the same period in 2010. Net income increased 85.8% to $99.6m from $53.6m in the first nine months of 2010. Old Dominion’s operating ratio improved to 87.8% from 90.8% for the first nine months of 2010.
"Old Dominion continued to produce substantial profitable growth for the third quarter of 2011, with both our revenue and operating ratio improving to new quarterly records," remarked David S. Congdon, President and Chief Executive Officer of Old Dominion. "Our revenue growth for the quarter again reflected significant tonnage growth and a favorable pricing environment. Tonnage increased 9.6% compared with the third quarter last year, and revenue per hundredweight rose 13.7%, or 7.8% excluding fuel surcharges. This increase represents the continuation of our yield management process, which includes the impact of a 4.9% general rate increase implemented on September 6, 2011. Our revenue per hundredweight was also favorably impacted by both a 2.2% decrease in weight per shipment and a 0.3% increase in average length of haul.
"Greater operating leverage, driven by our tonnage growth, and our disciplined yield management process were primarily responsible for the 280 basis-point improvement in our operating ratio to a record 86.2% for the third quarter. Our operating ratio also benefited from improvements in most of our key productivity measures. While effectively all the tonnage growth for the third quarter served to increase density in existing service centers, we did open two new service centers – in Madison, Wisconsin and Altoona, Pennsylvania. In October, we also opened a new service center in Canton, Ohio and relocated and expanded our service center in Wausau, Wisconsin. As a result, we currently have 216 service centers in operation."
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