Feb. 06--Another strong quarterly performance enabled Old Dominion Freight Line Inc. to achieve a third consecutive record revenue year.
The company reported Thursday a 19.4 percent jump in profit to $47.1 million during the fourth quarter. It has had an 11 percent increase in revenue to $592.5 million.
With $2.34 billion in revenue for fiscal 2013, Old Dominion beat its previous revenue record by 9.5 percent. Net income was $206.1 million, up 21.6 percent.
The earnings performances bode well for Old Dominion, a Top 10 trucking company, which has more than 600 employees at its Thomasville headquarters and about 550 employees at a service center in Greensboro.
A less-than-truckload carrier, such as Old Dominion, is able to ship products more quickly and attract more customers because it is not dependent on a full trailer to make a profit.
David Congdon, Old Dominion's president and chief executive, said in a statement that most of the quarterly and full-year revenue increases came from gaining market share from competitors.
Over the past 10 years, the company has expanded its local and overall workforce significantly when many competitors have retrenched, been bought or gone out of business. Old Dominion has 12,952 employees companywide.
It blankets the entire country with 220 service centers, up from 125 in 2003.
"We are confident in our ability to win additional market share in 2014," Congdon said.
However, Old Dominion's fourth-quarter earnings performance wasn't as prolific as analysts had projected.
The company had diluted earnings of 55 cents a share, up 9 cents from the fourth quarter of 2012.
The average earnings forecast was 59 cents by 11 analysts surveyed by Zacks Investment Research.
Investors responded by sending the stock down 2.9 percent, or by $1.54, to $51.12 as of 10 a.m. today. The 52-week share price range is $34.58 to $57.
Congdon said he was pleased with the quarterly earnings gain, "particularly in light of the operational challenges and increased costs resulting from the significant winter weather and more restrictive hours-of-service regulations during the fourth quarter."
The company said it spent $295.6 million on capital investments in fiscal 2013, funded through operating cash flow.
It projects spending $342 million on capital investments in fiscal 2014: $132 million for real estate and expansion projects at existing facilities; $163 million for tractors, trailers and other equipment; and $47 million for technology and other assets.
Congdon said his confidence in gaining market share comes primarily from "our long-term and on-going investment in our people, equipment and technology, which enables us to deliver superior customer service at a fair and equitable price."
David Ross, an analyst with Stifel Nicolaus, has praised Old Dominion's management for "having a better understanding of its costs and being disciplined at monitoring changes in costs and customer freight to make sure it is getting a fair price for what it is hauling."
"The continued investments the company made through the downturn, while its competitors were cutting investment, helped improve service, which attracted and kept more customers and added to density."
(c)2014 Winston-Salem Journal (Winston Salem, N.C.)
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