Werner Enterprises’ overall operating income surged in Q1 to $4 million from a $5.8 million loss a year ago, aided by performance improvements, the company reported Tuesday.
Its Truckload Transportation Services segment, which consists of the company’s dedicated and one-way truckload business, contributed to the strong uptick. Meanwhile, its acquisition of FirstFleet in January helped bring in more dedicated revenue.
“We believe Warner is better positioned today than we have been in prior cycles,” CEO Derek Leathers said on an earnings call Tuesday. “We’ve used this downturn to make the business more resilient.”
Supply-driven constraints are aiding the market, he also said. Additionally, dedicated and one-way truckload “outperformed expectations, supported by solid pricing, strong retention, and disciplined execution,” according to an earnings call presentation.
Among the reasons for the turnaround, Leathers suggested shippers are gravitating toward quality with the carrier they select.
Overall, adjusted operating income of “$14.8 million increased $12.9 million due to lower insurance and claims expense (excluding FirstFleet), the addition of FirstFleet, profitability improvement in One-Way Truckload and higher gains from sale of used equipment,” the company said in an earnings release.
As part of a restructuring of its one-way truckload business, the company reduced that fleet to 2,122 trucks on average, down from 2,386 in Q4 and 2,632 a year ago. But profitability improved there at the same time, with average revenue per truck rising 9.6%. That restructuring began in Q4 with Werner seeking to mitigate unprofitable freight, the company noted.
A net loss attributable to Werner, which includes taxes and other factors, was $4.3 million for the quarter, down from a $10.1 million hit a year ago.
