P.A.M. Transportation Services on Tuesday, April 29, reported a net loss of $2,828,326 for the quarter ended March 31 compared to net income of $1,264,931 for the year-ago period. Operating revenues for the quarter were $105,820,696, a 7.1 percent increase compared to $98,808,456 during the same time last year.
“The results for the current quarter are humbling, and are reflective of the continued economic weakness in truckload freight demand and upward volatility of fuel,” said Robert W. Weaver, president of the Tontitown, Ark.-based company. “The unprecedented rise in fuel costs, net of fuel surcharge, has negatively impacted our operating income by approximately $4.4 million.”
Weaver said the lack of truckload freight demand and resulting pricing competition continues to exert downward pressure on rates, impeding the company’s ability to negotiate rate increases and often resulting in rates that are unacceptable in light of current costs. “As a result of these downward rate pressures, we have opted to walk away from some business and reduce fleet capacity to compensate when replacement freight was not added,” he said.
“Looking forward, we don’t see much improvement in truckload freight demand in the near future,” Weaver said. “However, we do hear that capacity reductions are occurring in the industry, both by fleet reduction and through bankruptcies. As we continue to aggressively seek and capitalize on ways to control costs, we hope to see industry capacity reductions resolve the current imbalance between truckload freight and available capacity in the industry and create opportunities for us to negotiate rate increases that more fairly compensate us for our services.”