USA Truck Inc., a leading capacity solutions provider, announced that for the quarter ended Sept. 30, 2016, operating revenue was $105.5 million compared to $123.5 million for the prior-year period.
Base revenue, which excludes fuel surcharges, was $94.7 million compared to $109.8 million for the 2015 period. Net income (loss) was ($0.7) million, or ($0.09) per diluted share, compared to $2.7 million, or $0.26 per diluted share, a year earlier. Included in earnings per share for the Sept. 30, 2015 quarter was $2.9 million, or $0.17, net-of-tax, per share of restructuring costs.
President and CEO Randy Rogers said, “We marked significant progress toward our goals of expanding the scope of USAT Logistics, improving service levels in our truckload business and reducing operating costs in the third quarter. Those gains were, and for the near term will likely be, offset by a weak freight environment and unfavorable comparisons versus prior periods due to the loss of certain dedicated account customers earlier this year.
“While encouraged by our progress, we recognize our results have not reached our goals and are committed to achieving substantial improvements in profitability as we move into the 2017 bid season and benefit from the extensive operating changes made over the past year.
Rogers continued, “As previously discussed, one of our principal goals is for our higher margin, asset-light brokerage operations to contribute 50 percent of the company’s consolidated revenue. In support of this objective, during the quarter we expanded its sales channels to include agents in secondary markets and since have consolidated operations from smaller, inefficient offices into our larger regional centers while maintaining existing client manager relationships.
“We also completed the migration to a more efficient operating model featuring carrier and customer specialization, which has already begun to benefit productivity and effectiveness. While net revenue for the quarter of $6.0 million represented a 16.1 percent decline versus the 2015 period due to a soft freight environment and lower volumes, gross margin remained favorable at 18.1 percent.
“In Trucking, we achieved modest improvement in loaded rate per mile to $1.725 despite the difficult rate environment and posted a 4.3 percent decrease in operating expenses on a sequential basis, bringing O&M expenses per mile down to $0.182, the lowest in over four years,” he said.
“Further, in light of market conditions, we reduced company-owned tractors by 6.3 percent through the elimination of our 2012 and 30 percent of our 2013 tractors, which were high cost, challenging for our drivers and placed significant burdens on our maintenance operations. On a sequential basis, Trucking’s adjusted operating ratio improved slightly from 103.0 percent for this year’s second quarter as the operating loss narrowed from $2.0 million to $1.5 million, reflecting the benefits of our improvement plan in a tough environment.