Even with a new CEO, business remains tough for Van Buren-based USA Truck, which on Monday reported a $2.5 million loss for the first quarter of 2013.
However, the loss was better than the $4.9 million loss in the first quarter of 2012, and total revenue for the first quarter of 2013 was $132.027 million, almost 7% higher than the first quarter of 2012.
“Our operational execution continues to improve, helping us overcome difficult weather conditions across our operating areas and fewer business days due to leap year and an early Easter. We are pleased with our progress, and our top priority is returning to profitability as quickly as possible and restoring shareholder value,” John Simone, president and CEO of USA Truck, said in the earnings statement.
Simone was named the new USA Truck boss in February, replacing Cliff Beckham, who was moved to the post of chief financial officer. Simone has more than 30 years of operational and management experience in the transportation industry with leading companies that include UPS, Ryder, and Greatwide Logistics. Most recently, he was the CEO of LinkAmerica where he led a successful operational turnaround.
The first quarter per share loss of 24 cents was better than the consensus analyst estimate of a 28 cent per share loss.
HIGHER COSTS
In the earnings report, company officials said revenue growth of 5.1% and expense growth of 1% is a sign the “yield management initiatives” put in place in 2012 are moving numbers in the right direction. However, Simone said more changes are coming.
“I believe there is a strong foundation and, as this earnings report points out, positive momentum. We expect to build upon that foundation and momentum by adding greater clarity, focus and execution. Our strategy: return to profitability and restore shareholder value through operational excellence, profitable revenue growth and cost efficiencies. We have identified, developed and begun executing high-leverage activities in each of these critical areas,” Simone noted in the report.
Trucking revenue during the quarter (excluding fuel surcharge) was $79.793 million, ahead of the $75.937 million during the second quarter of 2012. The brokerage/logistics business (Strategic Capacity Solutions) revenue was $21.459 million, up almost 22% compared to the 2012 quarter. The intermodal division revenue was $3.635 million, down from $4.291 million in the 2012 quarter.
Higher expenses cut into the revenue gains seen in the trucking and brokerage businesses. Overall operating costs were $134.854 million, up 3.48% compared to the first quarter of 2012.
Some of the key operating metrics for USA Truck did show improvement. Total miles hit 54.618 million, better than the 53.36 million in the 2012 quarter. The empty miles ratio fell to 11% from 11.8% in the first quarter of 2012, and the base trucking revenue per loaded mile increased from $1.613 in the 2012 quarter to $1.642 in the first quarter of 2013.
REVERSE THE COURSE
Simone’s job for shareholders is to reverse performance that has resulted in four consecutive years of income losses.
With approximately 500 employed at the corporate headquarters, the company’s future is a concern to many in the area.
Full-year financials released Jan. 31 showed a $17.54 million loss for 2012, marking four consecutive years of losses. USA Truck posted a 2011 net income loss of $10.77 million, more than triple the loss during 2010 and in a year when other trucking companies began to see improved financials. In 2010, the company reported a loss of $3.308 million, and a $7.177 million loss in 2009.
USA Truck was forced in August 2012 to obtain a new line of credit during the third quarter of 2012 after violating covenant agreements with the previous credit arrangement. Poor national freight demand and missteps by USA Truck in implementing new software were factors leading to a string of financial losses for the long-haul carrier.
The company announced in late December the addition of Thomas Glaser to the management team. Glaser, a former president and COO of Celadon Group who has 24 years of trucking industry experience, is the second attempt to bring experience into USA Truck operations.
The thinly traded shares of USA Truck (NASDAQ: USAK) closed Friday at $5.37. During the past 52 weeks the share price has ranged from a $6.98 high to a $2.65 low.