P.A.M. Transportation says 1Q earnings down 76%

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P.A.M. Transportation Services last week posted first-quarter net income of $1.3 million, a decline of 76 percent when compared with $5.2 million for the same period of 2006. Operating revenue, excluding fuel surcharges, was off 3.6 percent to $87.5 million for the first quarter, compared with $90.8 million last year.

“Several factors contributed to the reduction of net income for the first quarter of 2007 when compared to the first quarter of 2006,” said Robert W. Weaver, president of the Tontitown, Ark.-based truckload dry van carrier. “Predominant among these factors was the softening of the freight market in the first quarter of 2007. This decline in demand resulted in very aggressive competition for available freight and generally resulted in a shift to a market more favorable to shippers. The softer freight demand resulted in a decrease in our equipment utilization and an 8 cent decrease in our revenue per total mile, before fuel surcharges.”

Other detriments to first-quarter profit, the company said, included increases in equipment maintenance costs and, to a lesser degree, fuel expense. “Severe weather experienced in many of the states which we operate in most heavily resulted in year-over-year increases in equipment maintenance costs and decreased fuel efficiency,” Weaver said. “In addition, the cost of fuel increased sharply in March, outpacing offsetting increases in fuel surcharges recovered from customers.”