Old Dominion reports upbeat quarterly profit on higher shipments
Jan 31 (Reuters) - Old Dominion Freight Line reported a fourth-quarter profit above Wall Street estimates on Wednesday, helped by an uptick in shipments.
The less-than-truckload (LTL) carrier, which ships relatively small loads of freight between 150 pounds and 15,000 pounds, posted a profit of $2.94 per share, compared with analysts' average estimate of $2.85 per share, according to LSEG data.
Revenue for the quarter ended Dec. 31 came in at $1.49 billion. Analysts had estimated revenue of $1.50 billion. Shipments in the LTL business, Old Dominion's biggest segment, rose 1.5%.
"We believe underlying demand for LTL service remained relatively consistent in the quarter, which corresponds with the consistency in our volume trends," CEO Marty Freeman said.
Old Dominion's total operating expenses, however, rose 1.2% to $1.07 billion in the quarter.
Trucking companies have been struggling with rising costs following a decline in e-commerce volumes from pandemic highs as people returned to normal shopping patterns and spent more on experiences such as travel and dining out.
The Thomasville, North Carolina based carrier's operating ratio, a key metric that indicates operating expenses as a percentage of revenue, rose 60 basis points to 71.8% from a year earlier.
A higher operating ratio reflects an increase in costs, thus suggesting growing inefficiency in a company. (Reporting by Abhinav Parmar; Editing by Shinjini Ganguli)
