Con-way announces lower 3Q profit, revenue

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Con-way posted third-quarter earnings Tuesday, Oct. 17, that beat its lowered forecast, but the company’s results were still weaker than a year earlier amid lower truckload volumes. The San Mateo, Calif.-based company’s net income fell to $64.8 million from $67.8 million a year earlier; the results included a gain of $6.2 million from the sale of its Con-way Expedite business.

In September, Con-way slashed its profit projections for the quarter amid lighter-than-expected volume in its less-than-truckload business. Con-way’s third-quarter revenue also declined slightly to $1.076 billion from $1.084 billion a year earlier; the company said that its less-than-truckload volumes were restrained, while it didn’t see tonnage growth typical of the traditional third-quarter pick-up.

“We pushed the lever on yield at a time when the market began to slow, and we paid for that in lower tonnage,” said Douglas W. Stotlar, Con-way’s president and chief executive officer. “Managing volume and yield is a shifting dynamic that we work to balance constantly. The key is to find the value point that is compelling for the customer and compensatory for our service. We are working with our customers to achieve this mutual objective.”

Stotlar added that the company has a number of targeted sales initiatives under way, which it expects will reinvigorate growth as they are implemented through the remainder of 2006 and into 2007. “We continue to receive feedback from customers that our service is market-leading,” Stotlar said. “Productivity and on-time performance in the LTL operations is the best in five years, measured against the toughest standards we’ve ever had. We’re confident that our value proposition – in both freight transportation and logistics – remains one of the strongest in the industry, and is an excellent foundation that will deliver sustainable, profitable growth.”