Feb 4 (Reuters) - Old Dominion Freight Line ODFL.O reported a fall in fourth-quarter profit and revenue on Wednesday, hurt by lower volumes as it navigates a challenging freight environment.
The U.S. trucking market remains in a prolonged slowdown following the 2022 e-commerce boom. Low shipment volumes, excess capacity and weak domestic industrial production continue to impact U.S. carriers.
U.S. manufacturing PMI, a gauge of economic activity, registered its tenth straight month of contraction in December, when it was at 47.9, according to data from the Institute for Supply Management. Readings below 50 signal shrinking activity.
"(Fourth-quarter) results reflect our ongoing commitment to revenue quality and cost discipline in what remains a challenging operating environment," CEO Marty Freeman said.
Shares of the Thomasville, North Carolina-based less-than-truckload $(LTL)$ carrier, which caters to companies in the retail, manufacturing, automotive and healthcare sectors, were down 2.9% in premarket trading.
The company's operating ratio, a key measure of operating expenses as a share of revenue, rose 80 basis points to 76.7% from a year earlier. A higher operating ratio signals higher costs relative to sales, pointing to weaker operating profitability.
Old Dominion handled a total of 1.9 million tons of shipments in the fourth quarter, down 10.7% from the year earlier.
Total revenue fell 5.7% to $1.31 billion in the quarter. Profit per share dropped 11.4% to $1.09.
Analysts on average had expected revenue of $1.30 billion and profit of $1.06 per share, according to data compiled by LSEG.
(Reporting by Abhinav Parmar in Bengaluru; Editing by Tasim Zahid)
((Abhinav.Parmar@thomsonreuters.com;))
Comments