Forward Air reports lower 2Q profit

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Forward Air Corp. on Monday, July 20, reported revenue, operating income and net income for the second quarter and six months ended June 30:

  • Operating revenue for the quarter decreased 18.0 percent to $99.7 million from $121.6 million for the same quarter in 2008. Income from operations was $4.9 million compared with $20.3 million. As a percent of operating revenue, income from operations decreased to 4.9 percent from 16.7 percent. Net income decreased to $2.8 million from $12.1 million.
  • Operating revenue for the six months decreased 14.5 percent to $196.3 million from $229.5 million for the same period in 2008. Results from operations, which includes a first-quarter noncash pretax charge of $7.2 million primarily for goodwill impairment related to the company’s Forward Air Solutions segment, was a loss of $0.2 million compared with income from operations of $36.9 million. Including the impact of the goodwill impairment, the company’s net loss was $0.3 million compared with net income of $22.1 million.
  • “As expected, the challenging freight environment resulting from the global economic recession persisted throughout the second quarter,” said Bruce A. Campbell, chairman, president and chief executive officer of the Greeneville, Tenn.-based company. “However, during the quarter, volumes in our core airport-to-airport business showed signs of stabilization. Our second-quarter tonnage declined on a year-over-year basis, but slightly less than the decline we experienced in the first quarter. During the quarter, our yield was severely impacted by the intense pricing pressure which began for us near the end of the first quarter, as well as a difficult prior-year fuel surcharge comparison.”

    Campbell said the company’s goal during the economic downturn in its airport-to-airport operations has been and continues to be aggressive and effective management of expenses to the current business levels without jeopardizing the superior earnings power of the model. “Thus far, we have been successful in that regard while generating respectable profits and cashflows given the conditions,” he said.