Velocity Express reports lower 3Q gross profit

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Velocity Express Corp. — a provider of time-definite regional delivery solutions — announced operating results for the third quarter and nine-month period ended March 29.

Revenue for the quarter was $82.2 million compared to $98.2 million in the March quarter of 2007. The company reported gross profit excluding depreciation for the quarter of $20.9 million, or 25.4 percent of sales, compared to gross profit of $22.2 million, or 22.6 percent of sales, for the same quarter last year.

Operating expenses included in adjusted EBITDA were $22.3 million compared to $24.0 million in the same quarter last year. Adjusted EBITDA improved $0.18 million to a loss of $1.65 million compared to a loss of $1.83 million in the prior-year quarter. Operating loss for the quarter was $3.7 million compared to an operating loss of $6.2 million in 2007.

“Despite the challenges of the significant fuel cost increases and the impact of a slowing economy, the company was profitable in the months of March and April,” said Vincent A. Wasik, chairman and chief executive officer of Westport, Conn.-based Velocity Express. “During the quarter, we completed our project to realign driver settlements with prevailing market rates, and we continued to renegotiate or exit from unfavorable low-margin legacy-CD&L contracts, including a number with uneconomic fuel indexing provisions. More work remains to be done, particularly with regard to establishing a fair basis for fuel indexing, but we are pleased with our progress to date.”