Old Dominion reports higher revenue despite tonnage falloff

Though its less-than-truckload tonnage fell off in the third quarter, Old Dominion Freight reported 14.5% increased revenue.

The carrier also improved its operating ratio on a year-to-year basis for the 11th consecutive quarter, according to a third-quarter earnings statement.

“Our revenue increased 14.5% during the third quarter of 2022 due primarily to the 17.4% increase in LTL revenue per hundredweight, which more than offset the 2.6% decrease in LTL tons,” Greg C. Gannt, Old Dominions president and CEO, said in the earnings statement.

Old Dominion’s operating ratio improved to 69.1% for the third quarter of 2022. For last year’s third quarter, the operating ratio was 72.6%. The lower the operating ratio, the more efficient a company is at generating revenue for the amount spent on expenses.

The company was able to rein in the cost of salaries, wages and benefits as a percent of revenue in the third quarter, going from 46.4% in the third quarter of 2021 to 42.1% for the 2022 third quarter. Purchased transportation costs improved 160 basis points to 2.1% of revenue.

“These improvements more than offset the increase in operating supplies and expenses as a percent of revenue that primarily resulted from the significant increase in the cost of diesel fuel and other petroleum-based products during the quarter,” Gannt said.

Old Dominion reported 2022 third-quarter revenue of $1.6 billion (compared to $1.4 billion in 2021) and year-to-date revenue of $4.67 billion (compared to $3.84 billion in 2021).

It shipped 1.5 million pounds of LTL freight in the third quarter of 2022, and its average length of haul of 932 miles.

Thomasville, N.C.-based Old Dominion Freight Line Inc. was founded in 1934 by Earl and Lillian Congdon, who were recently inducted into the American Truck Historical Society American Trucking and Industry Leader Hall of Fame. It is a nonunion carrier. Its stock is traded on the Nasdaq stock exchange. It has OD Domestic LTL, OD Expedited LTL, OD Global, OD Truckload, OD Container Drayage and OD Specialized Services divisions. LL

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