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Universal Logistics Posts Record First Quarter Despite Truckload Decline

FreightWaves

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Universal Logistics (NASDAQ: UHL) reported its best-ever first quarter for revenue and earnings on April 25, as strength from its intermodal and brokerage divisions offset a decline its truckload business.

Warren, Michigan-based Universal's net income rose by 65.8 percent year-over-year to $17.3 million during the first quarter of 2019. Earnings per share came in at $0.61, beating analysts' estimates of $0.56.

Operating revenues hit $377.4 million during the quarter, a 12 percent increase compared to $335 million in the first quarter of 2018. Universal increased its operating margin to 7 percent, compared to 5.1 percent in the first quarter of 2018.

"2019 is off to a solid start," Universal CEO Jeff Rogers said in a statement. "We hit our target for operating margin in the first quarter, which is historically our toughest quarter, and we see this as a very positive start to the year. The first quarter of 2019 was also Universal's best first quarter ever in terms of top-line revenues and earnings."

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The first quarter earnings followed record fourth quarter 2018 earnings that Universal reported in February.

Overall, Universal's transportation segment, which includes truckload, brokerage and intermodal, reported a 23.9 percent increase in operating income, to $12.5 million compared to a year earlier. Operating revenue rose by about 20 percent to $246.7 million.

Net income surged in the logistics segment, increasing by more than 80 percent, to $13.8 million. Operating revenue was flatter, increasing from $128.6 million to $130 million.

Intermodal services revenue hit $91.2 million, more than double the $44.6 revenue in the first quarter of 2018. Acquisitions made during 2018 contributed $40.6 million of that revenue, while Universal said average revenue per load also increased by 12.8 percent.

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Operating revenue from truckload decreased by nearly 15 percent to $65.7 million, compared to $77.2 million during the first quarter of 2018. Universal said this reflected a 16.3 percent decrease in loads – to 61,092 from 72,966.

Brokerage services posted a 9.8 percent increase in revenue to $85.9 million in the first quarter, largely because of a 16.5 percent increase in brokerage loads moved. It offset a 7.1 percent decline in revenue per load.

Value-added services had a small decrease in revenue, from $98.1 million to $97.1 million during the quarter.

Universal will hold a call with analysts on April 26 to discuss the company's first-quarter results.

Image sourced from Pixabay

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