Saia Inc., a less-than-truckload carrier based in Duluth, Ga., today, July 24, reported second-quarter 2007 results.
Second-quarter 2007 compared to second-quarter 2006 results from continuing operations:
“Saia achieved solid top-line revenue growth, but did not achieve targeted margins,” said Rick O’Dell, president and chief executive officer. “We believe this was primarily due to the soft shipping environment, with costs further impacted by accident severity. In spite of reducing accident frequency versus the prior year quarter, this was a particularly difficult quarter for accident expense.”
O’Dell said Saia plans to address the current environment through increased marketing efforts throughout its system, capitalize on growing synergy revenue and focus on cost initiatives to improve profits. “Despite the difficult market conditions, employees demonstrated their ability to deliver Saia’s reliable service to our customers,” O’Dell said.
The recent acquisitions of The Connection and Madison Freight System expanded coverage in the states of Indiana, Ohio, Kentucky, Michigan and Wisconsin, and contributed to most of the revenue growth during the second quarter, the company said. Estimated operating losses from the expanded territory were slightly more negative than management’s original expectations due to difficult market conditions and higher-than-anticipated account turnover, according to Saia.
However, synergy revenue to and from this geography exceeded management’s expectations, and Saia said margins should continue to improve due to the upgrade of the account mix and building density in synergy lanes going forward. The company expects the expanded geography to begin contributing positively to operating income in the fourth quarter of 2007 and continuing into 2008.
Year-to-date 2007 results from continuing operations compared to year-to-date 2006: