Celadon Group reports 1Q net income up 12%

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Celadon Group Inc. on Tuesday, Oct. 21, reported its financial and operating results for the three months ended Sept. 30, the first fiscal quarter of the company’s fiscal year ending June 30, 2009.

Revenue for the quarter increased 9.8 percent to $146.9 million in the 2008 quarter from $133.8 million in the 2007 quarter. Freight revenue, which excludes fuel surcharges, was down 4.0 percent to $109.3 million from $113.9 million. Net income increased 12.0 percent to $2.8 million from $2.5 million.

“Celadon continued to exhibit strong execution in a difficult freight market during the quarter,” said Steve Russell, chairman and chief executive officer of the Indianapolis-based company. “In the current economic environment, significant rate and volume increases are tough to come by. Our emphasis has been on targeted action that will make our network more efficient and position us to capitalize when the balance between industry capacity and freight demand becomes more favorable.”

Russell said that in periods of weak demand, cost control is important. “We continued to actively manage our costs, particularly fuel expense,” he said. “For the past year, we have employed numerous tactics to improve fuel efficiency and lower costs. We have reduced the top speed of our tractors, improved tractor aerodynamics, added auxiliary heaters, implemented a strict tractor idling policy, renegotiated bulk fuel purchasing arrangements and counseled our drivers in more efficient driving patterns. Although the drop in fuel prices from July through September certainly benefited us this quarter, our concerted efforts over the past year contributed more to the quarter’s results.”

Russell said that looking forward, the company is confident in its strength and position in the industry. “We believe our strategic growth plan is sound and that we have the team to execute it,” he said. “We intend to keep our most important strategic asset – our corps of safe and experienced drivers – intact and ready to capitalize on increased market share when the combination of our efforts and a better freight market improve the operating environment.”