Forward Air Corp. on Monday, Feb. 10, reported results for the fourth quarter and year ended Dec. 31.
Operating revenue for the quarter increased 7.8 percent to $123.4 million from $114.5 million for the same quarter in 2007. Income from operations was $14.0 million compared with $20.0 million, a decrease of 30.0 percent. As a percent of operating revenue, income from operations decreased to 11.3 percent from 17.5 percent. Net income decreased by $4.1 million, or 32.8 percent, to $8.3 million from $12.4 million.
Operating revenue for the year increased 20.8 percent to $474.4 million from $392.7 million for the same period in 2007. Income from operations was $70.3 million compared with $71.0 million, a decrease of 1.0 percent. As a percent of operating revenue, income from operations decreased to 14.8 percent from 18.1 percent in 2007. Net income decreased 5.3 percent to $42.5 million from $44.9 million.
“As noted in last month’s update, we experienced an unprecedented decline in demand for our core airport-to-airport freight services during the fourth quarter 2008,” said Bruce A. Campbell, chairman, president and chief executive officer of Greeneville, Tenn.-based Forward Air. “This negative trend accelerated throughout the quarter with December volumes declining in excess of 20 percent from December of 2007. Thus far this year, volumes appear to have stabilized around negative 20 percent in our core business.”
Campbell said that in response to the dramatic decline in volume, Forward Air has made further reductions in its work force, initiated an across-the-board salary and wage freeze, curtailed 2009 planned capital spending and continued to attack every expense line item in order to drive meaningful cost reductions. “It is important to note that we have taken all of these measures without sacrificing the superior level of service that has differentiated Forward Air from our competitors,” he said. “This is truly a testament to the dedication of our employees and independent owner-operators, and they have our sincerest appreciation.”
Rodney L. Bell, senior vice president and chief financial officer, said that fourth-quarter cash flow from operations was $21.1 million as compared to $18.6 million in the same quarter of 2007, further illustrating the strength of the company’s nonasset model even in the most challenging of economic environments. “As mentioned in our update, we ended the year with just over $22 million in cash and $42.2 million available on our $100 million line of credit,” Bell said.