Old Dominion posts lower 1Q revenue, net income

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Old Dominion Freight Line Inc. today, April 23, announced financial results for the first quarter ended March 30. Revenue was $295.1 million compared with $368.2 million for the first quarter of 2008. Net income was $4.0 million compared with $10.4 million. Operating ratio was 96.6 percent versus 94.3 percent.

“Industry conditions during the first quarter of 2009 continued to reflect the effects of the recessionary economic environment on freight demand, and pricing pressure was as severe as we have ever experienced,” said Earl Congdon, executive chairman of the Thomasville, N.C.-based company. “Under these circumstances, however, we maintained our focus on pricing discipline, improved the efficiency of our operations and positioned the company to take advantage of growth opportunities following an economic recovery or meaningful industry consolidation. As a result of our efforts and despite the unprecedented operating environment, Old Dominion was able to minimize the effects of a 12.4 percent decline in tonnage and operate profitably for the quarter.”

Congdon said that although Old Dominion remains focused on implementing additional efficiency improvements and aggressively controlling its variable costs, it is balancing these efforts with its strategies to achieve its long-term growth objectives. “In this regard, we have maintained the appropriate resources to act decisively and to take advantage of industry consolidation that often arises during economic downturns,” he said. “We have continued to enhance and expand our service center network during the first quarter by opening two new service centers and relocating several others to larger facilities. We also continued to purchase new equipment.”

Congdon said he expects cash provided by operating activities to fund the majority of the company’s capital expenditures in 2009. “We also have approximately $150 million of available borrowing capacity on our unsecured revolving credit facility, which is not scheduled to mature until August 2011,” he said. “We intend to continue to focus on the execution of our business strategies, which we are confident will not only enable us to manage the short-term challenges presented by the current economic environment but also to realize our long-term growth objectives. Through the consistency of our focus and the discipline in our execution, we believe Old Dominion is positioned to achieve stronger results as the economic cycle strengthens.”