Dynamex reports lower 1Q profit, higher sales

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Dynamex Inc., a provider of same-day delivery and logistics services in the United States and Canada, announced Wednesday, Dec. 3, net income of $3.0 million for the fiscal year 2009 first quarter compared to $4.0 million in the prior year. A one-time special payment in the current quarter to the current chairman of the board and former president and chief executive officer of $1.5 million reduced net income. Sales increased 3.3 percent to $115 million; the company estimates that higher fuel surcharges account for about a 3.2 percent increase in sales compared to the prior year.

“Our first-quarter performance was solid and exactly in line with our expectations despite the unprecedented turmoil in the financial markets that occurred in September and continued softening in the overall economy,” said Rick McClelland, chairman of Dallas-based Dynamex. “We continued to achieve both top-line and bottom-line growth, excluding the impact of the one-time special payment, and improvements in our margin.”

McClelland said that with the addition of franchisees in two markets, the company now has franchisees in 46 markets in Canada and the United States. “While the current environment is challenging at best, it is important to remember our business is debt-free, with no need to access the capital markets,” he said. “We can easily fund our operations with cashflow generated from operations. Extraordinary times require extraordinary people, and I’m confident in our people and position in the marketplace, and our ability to maximize profitability despite the current challenges.”

McClelland said that while the economic slowdown that accelerated in September did not have a significant impact on Dynamex’s first-quarter results, the company was beginning to see a slowdown in shipment volume from a number of customers. “We are currently in discussions with our largest customer to rescale its delivery network in response to lower volumes and to reduce costs,” he said. “While we have modified our outlook for fiscal 2009, our variable cost business model — combined with our industry -leading technology, North American presence and long-term growth strategy — provides us with a platform to sustain solid levels of profitability during this period of extraordinary market uncertainty.”