Old Dominion Freight Line, a leading less-than-truckload (LTL) carrier, reported a decline in its third-quarter financial results, as the company continues to grapple with softness in the domestic economy and challenging operating conditions.
The company's revenue for the quarter fell by 3.0% year-over-year to $1.47 billion, missing analysts' expectations of $1.49 billion. This decrease was primarily driven by a 4.8% drop in LTL tons per day, partially offset by a 1.5% increase in LTL revenue per hundredweight.
Despite the revenue decline, Old Dominion's earnings per diluted share (EPS) of $1.43 met analysts' consensus estimate of $1.42. However, the EPS figure represented a 7.1% decrease compared to the same quarter last year, marking the first year-over-year decline in quarterly earnings for the company in 2024.
The challenging operating environment and strong comparable results from the prior year contributed to the decrease in revenue and earnings. Old Dominion's operating ratio, a key measure of efficiency, deteriorated by 210 basis points to 72.7% for the third quarter, as the lower revenue had a deleveraging effect on operating expenses. Direct operating costs also increased as a percentage of revenue, driven by higher costs associated with the company's group health and dental plans.
Despite these challenges, Old Dominion maintained its focus on providing superior service to customers, achieving 99% on-time service and a cargo claims ratio of 0.1% during the quarter.
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