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ArcBest Corp. posted records for quarterly revenue, operating income and net income for the second quarter of 2022.
The Fort Smith, Ark.-based logistics company on July 29 reported net income of $102.5 million, or $4 per diluted share, for the three months ending June 30. That compared with $61 million, or $2.27, during the previous year. Total revenue increased 46.8% to $1.39 billion from $949 million.
“ArcBest’s talented and dedicated team has been successfully executing our strategy, delivering strong financial results and driving value-enhancing growth for the benefit of our shareholders, customers and other stakeholders,” ArcBest CEO Judy McReynolds said in a statement. “The second quarter of 2022 was no exception, as we achieved 47% revenue growth due to increasing demand for our broad offering of transportation and logistics services.”
Operating income increased 84.8% to a record of $137.3 million from $74.3 million last year. ArcBest attributed its improvements to strategic growth initiatives as well as innovation investments.
“As our customers’ supply chains become even more complex and economic pressures increase, our strategic focus on technology, innovation and the development of our people positions us to thrive in all environments,” McReynolds said. “By advancing our strategic plan and investing capital back into the business, we continue to differentiate ArcBest and position our company as a logistics leader, our customers’ partner of choice and a consistent generator of superior value for investors.”
The results surpassed Wall Street expectations. Analysts forecast EPS of $3.91 and quarterly revenue of $1.35 billion, according to Zacks Consensus Estimate.
The ArcBest asset-based segment reported Q2 revenue increased 22.9% to $802.6 million from $652.8 million last year. Operating income increased 82.6% to $116.7 million from $63.9 million. Growth in the segment was due in part to a healthy pricing environment, higher fuel surcharges and customer demand driving an increase in freight shipments and tonnage.
ArcBest noted it was able to achieve higher profitability using optimization tools and improved freight data, which helped it maintain more consistent day-to-day business levels while optimizing revenue and managing costs.
ABF Freight, the company’s less-than-truckload subsidiary,contributed to the asset-based segment with an increase in average weight per shipment. Plus, hiring initiatives at specific service center locations throughout the ABF Freight network contributed to a net increase in employees.
The asset-light segment reported Q2 revenue increased 91.3% to $631.8 million from $330.3 million during the prior-year quarter. Operating income increased 78.5% to $29.1 million from $16.3 million last year. Growth was driven by higher market rates combined with continued customer demand for services. The segment includes transportation, dedicated, expedited and international services. ArcBest noted that each service contributed to improved profitability compared with the prior-year period, as operating leverage increased due to the revenue growth of the business.
MoLo Solutions, acquired in November, continues to be integrated into the asset-light segment. It contributed to the unit by enhancing revenue and shipment totals through additional truckload brokerage services. FleetNet America, another subsidiary that provides fleet maintenance and repair service technology, helped lift segment revenue and profitability through increases in both total events and revenue per event.
ArcBest also provided an update on progress with its Environmental, Social and Corporate Governance (ESG) priorities. The company purchased electric straight trucks to pilot at its ABF Freight service center in San Bernardino, Calif., and also recently purchased Orange EV electric yard tractors for several service centers.
ArcBest ranks No. 15 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.
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