J. B. Hunt Transport Services Inc. on Wednesday, Jan. 27, announced fourth-quarter 2009 net earnings of $41.7 million vs. 2008 fourth-quarter earnings of $53.3 million. Total operating revenue was $877 million compared with $880. Intermodal (JBI) volumes increased by about 15 percent, resulting in a small increase in segment revenue, while Integrated Capacity Solution’s (ICS) revenue rose by 11 percent. Those increases were offset by declining fuel surcharge revenues in all segments and significantly lower rates. Current quarter operating revenue, excluding fuel surcharges, rose 4 percent.
Operating income declined to $73 million vs. $86 million, primarily due to lower rates applicable to significant parts of the company’s business. Net interest expense was up $3.4 million, primarily due to a 2008 refund related to a prior period tax settlement.
“While we are disappointed in the decline in earnings, we are encouraged by the expanding connection we see between our business units and how we can leverage our services together for the benefit of our customers,” said Kirk Thompson, president and chief executive officer of the Lowell, Ark.-based company. “A growing number of shippers are using all of our services as a way to meet all of their supply chain needs. From utilizing the obvious benefits of our Intermodal service, to professional final-mile delivery of their products to the end consumer, our customers are embracing our integrated services. In 2009, we expanded and solidified our Intermodal services network in the East, continued revenue and services growth in our nonasset ICS segment, implemented a comprehensive nationwide cross-dock and delivery system network in the DCS segment, and made strides toward right-sizing and stabilizing our Truck segment.”
Thompson said all of the company’s business segments experienced pricing pressure and resulting margin contraction aggravated by the ongoing recession. “The pressure contributed significantly to the decline in earnings for the year,” he said. “Prices must increase substantially to ensure a viable transportation industry through adequate returns. Obtaining acceptable pricing must be the most critical priority for 2010.”
