Dynamex posts lower 1Q profit on merger-related costs

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Dynamex Inc., a provider of same-day delivery and logistics services in the United States and Canada, on Thursday, Dec. 2, announced net income of $1.4 million for the fiscal year 2011 first quarter compared to $3.0 million in the prior-year quarter. The current quarter includes an $1.8 million pretax, $1.7 million after-tax charge for merger-related costs.

“Following a successful fiscal 2010, the company continued to build momentum during our fiscal first quarter producing better than expected sales,” said James L. Welch, president and chief executive officer of Dallas-based Dynamex. “Core sales per day increased for the fifth consecutive quarter, which is directly correlated to our continued focus on our long-term strategic initiatives.”

Welch said pricing remains highly competitive, and as a result, purchased transportation expenses were higher, as a percentage of sales, than the previous year. “However, we believe the company is showing significant improvement in its operations and is well positioned for continued expansion as the broader economy continues to slowly improve,” he said.

Sales were $111 million, which represented an 11.2 percent year-over-year increase due to higher core sales and fuel surcharges and a stronger Canadian dollar. Operating income was $3.0 million, a decline of 36 percent; excluding merger-related costs, operating income would have been about 3.3 percent higher this year than last year. Purchased transportation costs, the largest component of operating expenses, represented 65.7 percent of sales compared to 63.8 percent; the increase is attributable primarily to the impact of a more competitive pricing environment.