Old Dominion says 3Q revenue, net income both up

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Old Dominion Freight Line today, Sept. 23, announced financial results for the third quarter and nine months ended Sept 30. Revenue increased 14.5 percent to $415.9 million for the third quarter of 2008 from $363.3 million for the third quarter of 2007. Net income rose 16.7 percent to $23.4 million from $20.0 million. Old Dominion’s operating ratio improved to 89.8 percent from 90.6 percent.

Revenue increased 15.2 percent for the first nine months of 2008 to $1.20 billion from $1.04 billion for the first nine months of 2007. Net income increased 2.7 percent to $57.6 million from $56.1 million. The company’s operating ratio was 91.2 percent compared with 90.4 percent.

“We are pleased with Old Dominion’s performance in the third quarter in what was a challenging operating environment,” said Earl Congdon, executive chairman of the Thomasville, N.C.-based company. “We achieved solid revenue growth, improved our operating ratio and produced an increase in earnings per share that exceeded our expectations. We attribute our success in this difficult environment to our commitment to on-time and claims-free service, a strong focus on yield management and improved productivity.”

Congdon said the company’s tonnage for the quarter increased 7.4 percent compared to the third quarter last year on an 8.4 percent increase in weight per shipment and a 0.9 percent decline in the number of shipments. “As the third quarter and early fourth quarter have progressed, the rate of tonnage growth has slowed each month sequentially, which we attribute to the continued deterioration and uncertainty in the domestic and global economies,” he said. “While we believe the competitive pricing environment may intensify in the fourth quarter, we are committed to maintaining our disciplined pricing philosophy.”

Congdon added, however, that the sequential declines in tonnage and pricing trends for the third quarter and early weeks of the fourth quarter are not encouraging. “We remain extremely cautious about our short-term business outlook for the fourth quarter and beyond,” he said. “Old Dominion’s proven growth strategies have delivered very substantial long-term profitable growth. We have full confidence in these strategies, the deep experience of our management team and our nonunion employees, and the strong market positioning of Old Dominion to continue creating long-term shareholder value.”