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Dive Summary:
- Heartland Express reported a net loss of $15.1 million for the first quarter, according to earnings announcement Tuesday.
- The company posted an operating ratio of 105.3% and an adjusted operating ratio of 105.6% for the quarter, dangerous territory well short of its target of 85% or lower.
- The results “reflect the combination of an extended and significant period of weak cargo demand due to excess capacity in the industry, adverse early-quarter weather and continued operating cost inflation,” CEO Mike Gerdin said in the statement.
Dive Insight:
Despite efforts to combat the recession, the market wreaked havoc on Heartland in the 1st quarter.
The carrier did not rely on a brokered fare and refused to cut prices to unsustainable levels that some customers were demanding, Gerdin said.
“We continue to believe that the freight market will improve as more capacity exits the market,” he said.
To offset interest expense, the company also moved to reduce acquisition-related debt by nearly $37 million.
Heartland said it is also working to improve the operational efficiency of the businesses acquired by Smith Transport and TFI International in 2022.
Heartland has $1.5 billion in assets and $23.8 million in cash and cash equivalents.
Other carriers posted mixed first-quarter results this month. While PAM Transportation Services also made a loss, Marten Transport reported Operating income of $12.3 million.