Covenant Transport has announced financial and operating results for the fourth quarter and year ended Dec. 31. For the quarter, total revenue increased 8.7 percent, to $178.4 million from $164.2 million in the same quarter of 2004. Freight revenue, which excludes fuel surcharges, increased 0.8 percent, to $148.4 million in the 2005 quarter from $147.2 million in the 2004 quarter.
The company measures freight revenue, because management believes that fuel surcharges tend to be a volatile source of revenue and the removal of such surcharges affords a more consistent basis for comparing results of operations from period to period. Net income increased to $4.4 million from a net loss of $6.5 million in the 2004 quarter. The 2004 fourth quarter included a $12.2 million after-tax increase to insurance claims reserves.
For the year, total revenue increased 6.5 percent, to $643.1 million from $603.6 million during 2004. Freight revenue decreased 0.5 percent, to $555.4 million in 2005 from $558.5 million in 2004. The company generated net income of $5.7 million for the year, compared with $3.4 million for 2004.
“Although we still have a lot of work to do, I am very pleased with the progress that we made during the second half of 2005 to stabilize our freight base and improve our revenue per tractor both sequentially and versus a very strong fourth quarter of 2004,” says David R. Parker, chairman, president and chief executive officer of Chattanooga, Tenn.-based Covenant Transport.
“Average freight revenue per tractor per week, excluding fuel surcharge revenue, increased to $3,254 in the fourth quarter of 2005, an increase of 1.4 percent over the 2004 period and 6.1 percent sequentially over the third quarter of 2005. A key factor in the improvement was a 3.2 percent increase in average freight revenue per loaded mile, to $1.548 in the fourth quarter of 2005, compared with $1.500 in the fourth quarter of 2004. The increase in rates more than offset a 1.7 percent decrease in average miles per tractor, mainly attributable to a smaller percentage of teams during the fourth quarter of 2005 versus the fourth quarter of 2004.”