THOMASVILLE, N.C.--Old Dominion Freight Line, Inc. (NASDAQ: ODFL) today announced
financial results for the third quarter and nine months ended
September 30, 2006. Revenue for the third quarter increased 22.7% to
$337,569,000 from $275,076,000 for the third quarter of 2005. Net
income for the third quarter increased 26.2% to $20,103,000 from
$15,935,000. Earnings per diluted share rose 25.6% to $0.54 for the
third quarter of 2006 from $0.43 for the third quarter of 2005. Old
Dominion's operating ratio improved to 89.1% for the third quarter of
2006 from 89.5% for the third quarter last year. All prior-period
share and per share data in this release have been adjusted to reflect
the Company's three-for-two stock split effective in November 2005.
For the first nine months of 2006, revenue was $960,012,000, an
increase of 23.7% from $776,192,000 for the comparable period in 2005.
Net income increased 41.1% to $54,728,000 for the first nine months of
2006 from $38,786,000 for the first nine months of 2005, and earnings
per diluted share increased 41.3% to $1.47 from $1.04. Old Dominion's
operating ratio improved to 89.7% for the first nine months of 2006
from 90.8% for the same period in 2005.
"For the third quarter, Old Dominion again produced strong
financial results, with revenue growing in excess of 20% for the tenth
consecutive quarter and earnings per diluted share at the high end of
our established guidance," said Earl E. Congdon, Chairman and Chief
Executive Officer of Old Dominion. "Consistent with our performance
for the first half of 2006, we continued to gain market share within
our existing service center network in a relatively stable pricing
environment. We achieved a 2.7% increase in revenue per hundredweight,
excluding fuel surcharges, during the third quarter in spite of a 3.4%
increase in weight per shipment, which generally has the affect of
lowering this pricing metric. Our total tons shipped increased 15.3%
as a result of the increase in weight per shipment and an 11.5%
increase in shipments.
"Our revenue growth in the existing network has increased freight
density and capacity utilization, thereby driving further improvement
in our operating ratio for the third quarter. As a result, we have
generated comparable-quarter improvement in our operating ratio for
twenty consecutive quarters, a five-year period.
"We have also continued to enhance our future growth potential
through steady geographic expansion. We currently operate service
centers in 47 states in the continental United States, and we provide
full-state coverage in 37 of these states. As we open additional
service centers, we believe that we are building the requisite
infrastructure to meet a strategic goal of providing full-state
coverage throughout the continental United States. In pursuit of this
goal, we have opened five of the seven service centers anticipated to
open in the second half of 2006. The five new service centers were
opened in Seaford, Delaware; Pompano Beach, Florida; Rockford,
Illinois; Shreveport, Louisiana; and Saginaw, Michigan, giving us a
total of 180 service centers currently in operation.
"While we are maintaining our long-term growth objectives,
including our goal of exceeding $2 billion in revenue for 2010, we are
today revising our guidance for earnings per diluted share for 2006 to
a range of $1.87 to $1.90. This guidance is reduced from our previous
guidance in a range of $1.94 to $1.97, which was established in our
second-quarter earnings news release, but above the original guidance
issued in January 2006 in a range of $1.74 to $1.82. The decision to
revise our guidance is based on trending declines in both weight per
shipment and revenue per hundredweight experienced in October 2006 and
is consistent with market indicators of a slowing economy. We are also
establishing our guidance for earnings per diluted share for the
fourth quarter of 2006 in a range of $0.40 to $0.43, compared with
$0.39 for the fourth quarter last year."
Mr. Congdon concluded, "Old Dominion has produced a multi-year
record of significant profitable growth above the industry's average
growth rate. We attribute this record of strong secular growth
primarily to the strengths of our proven business model, including our
differentiated products, high quality service, non-union workforce,
deeply experienced management and strong financial position, combined
with the consistent implementation of our long-term growth strategies
throughout the economic cycle. Because we continue to demonstrate our
ability to provide single-source solutions for our customers' logistic
needs, whether in regional, national or international markets, we
remain confident of our ability to continue delivering secular growth
for 2006 and the years ahead."
Old Dominion will hold a conference call to discuss this release
today at 11:00 a.m. Eastern time. Investors will have the opportunity
to listen to the conference call live over the Internet by going to
www.odfl.com or by going to www.InvestorCalendar.com. Please log on at
least 15 minutes early to register, download and install any necessary
audio software. For those who cannot listen to the live broadcast, a
replay will be available at these Web sites shortly after the call
through November 26, 2006. A telephonic replay will also be available
through November 2, 2006, at 719-457-0820, Confirmation Number
4805481.
Forward-looking statements in this news release are made pursuant
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Investors are cautioned that such forward-looking
statements involve risks and uncertainties that could cause actual
events and results to be materially different from those expressed or
implied herein, including, but not limited to, the following: (1) the
competitive environment with respect to industry capacity and pricing;
(2) the negative impact of any unionization of the Company's
employees; (3) the challenges associated with executing the Company's
growth strategy; (4) various economic factors such as economic
recessions and downturns in customers' business cycles and shipping
requirements; (5) the availability and cost of fuel; (6) difficulty in
attracting or retaining qualified drivers; (7) the Company's exposure
to claims related to cargo loss and damage, property damage, personal
injury, workers' compensation, long-term disability and group health
and the cost of insurance coverage above retention levels; (8) the
Company's significant ongoing cash requirements; (9) the availability
and cost of new equipment; (10) the costs of compliance with, or
liability for, violation of existing or future governmental
regulation; (11) seasonal trends in the industry, including the
possibility of harsh weather conditions; (12) the Company's dependence
on key employees; (13) changes in the Company's goals and strategies,
which are subject to change at any time at the discretion of the
Company; and (14) other risks and uncertainties indicated from time to
time in the Company's filings with the Securities and Exchange
Commission.
Old Dominion Freight Line, Inc. is a less-than-truckload
multi-regional motor carrier providing one-to-five day service among
five regions in the United States and next-day and second-day service
within these regions. Through its four product groups, OD-Domestic,
OD-Expedited, OD-Global and OD- Technology, the Company offers an
array of innovative products and services that provide direct service
to 47 states within the Southeast, South Central, Northeast, Midwest
and West regions of the country, including 37 states within which it
provides full-state coverage. In addition, through marketing and
carrier relationships, Old Dominion provides service to and from the
remaining states as well as international services around the globe.
OLD DOMINION FREIGHT LINE, INC.
Financial Highlights
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, % September 30, %
------------------- -------------------
2006 2005 Chg. 2006 2005 Chg.
-------- -------- ----- -------- -------- -----
Revenue from
operations $337,569 $275,076 22.7% $960,012 $776,192 23.7%
Operating income $ 36,676 $ 28,769 27.5% $ 98,860 $ 71,270 38.7%
Operating ratio 89.1% 89.5% 89.7% 90.8%
Net income $ 20,103 $ 15,935 26.2% $ 54,728 $ 38,786 41.1%
Basic and diluted
earnings per
share $ 0.54 $ 0.43 25.6% $ 1.47 $ 1.04 41.3%
Weighted average
shares
outstanding
Basic 37,285 37,271 0.0% 37,285 37,269 0.0%
Diluted 37,285 37,273 0.0% 37,285 37,279 0.0%
OLD DOMINION FREIGHT LINE, INC.
Statements of Operations
----------------------------------------------------------------------
(In thousands, except per share amounts)
Third Quarter
-----------------------------------------
2006 2005 %Chg.
---------------- ---------------- -------
Revenue $337,569 100.0% $275,076 100.0% 22.7%
Operating expenses:
Salaries, wages & benefits 179,432 53.1% 148,659 54.0% 20.7%
Operating supplies &
expenses 56,265 16.7% 41,929 15.2% 34.2%
General supplies & expenses 9,496 2.8% 8,153 3.0% 16.5%
Operating taxes & licenses 12,022 3.6% 9,865 3.6% 21.9%
Insurance & claims 6,969 2.1% 6,768 2.5% 3.0%
Communications & utilities 3,442 1.0% 3,016 1.1% 14.1%
Depreciation & amortization 17,476 5.2% 14,716 5.3% 18.8%
Purchased transportation 11,603 3.4% 8,505 3.1% 36.4%
Building and office
equipment rents 2,813 0.8% 2,406 0.9% 16.9%
Miscellaneous expenses, net 1,375 0.4% 2,290 0.8% (40.0%)
Total operating expenses 300,893 89.1% 246,307 89.5% 22.2%
Operating income 36,676 10.9% 28,769 10.5% 27.5%
Other deductions:
Interest expense, net 3,067 0.9% 1,767 0.7% 73.6%
Other expense, net 408 0.1% 311 0.1% 31.2%
Income before income taxes
and cumulative effect of
accounting change 33,201 9.9% 26,691 9.7% 24.4%
Provision for income taxes 13,098 3.9% 10,756 3.9% 21.8%
Income before cumulative
effect of accounting change 20,103 6.0% 15,935 5.8% 26.2%
Cumulative effect of
accounting change (net of
income tax effect of $272) - 0.0% - 0.0% 0.0%
Net income $20,103 6.0% $15,935 5.8% 26.2%
========= =========
Earnings per share:
Basic $0.54 $0.43 25.6%
Diluted $0.54 $0.43 25.6%
.
Weighted average outstanding
shares:
Basic 37,285 37,271 0.0%
Diluted 37,285 37,273 0.0%
Year To Date
------------------------------------------
2006 2005 %Chg.
---------------- ---------------- --------
Revenue $960,012 100.0% $776,192 100.0% 23.7%
Operating expenses:
Salaries, wages & benefits 510,252 53.1% 426,516 55.0% 19.6%
Operating supplies &
expenses 154,748 16.1% 112,627 14.5% 37.4%
General supplies & expenses 28,596 3.0% 24,185 3.1% 18.2%
Operating taxes & licenses 34,688 3.6% 28,730 3.7% 20.7%
Insurance & claims 24,119 2.5% 23,083 3.0% 4.5%
Communications & utilities 10,927 1.1% 9,396 1.2% 16.3%
Depreciation & amortization 49,769 5.2% 40,714 5.2% 22.2%
Purchased transportation 34,214 3.6% 25,744 3.3% 32.9%
Building and office
equipment rents 8,482 0.9% 6,839 0.9% 24.0%
Miscellaneous expenses, net 5,357 0.6% 7,088 0.9% (24.4%)
Total operating expenses 861,152 89.7% 704,922 90.8% 22.2%
Operating income 98,860 10.3% 71,270 9.2% 38.7%
Other deductions:
Interest expense, net 7,095 0.7% 4,905 0.6% 44.6%
Other expense, net 855 0.1% 714 0.1% 19.7%
Income before income taxes
and cumulative effect of
accounting change 90,910 9.5% 65,651 8.5% 38.5%
Provision for income taxes 36,182 3.8% 26,457 3.5% 36.8%
Income before cumulative
effect of accounting
change 54,728 5.7% 39,194 5.0% 39.6%
Cumulative effect of
accounting change (net of
income tax effect of $272) - 0.0% 408 0.0% (100.0%)
Net income $54,728 5.7% $38,786 5.0% 41.1%
========= =========
Earnings per share:
Basic $1.47 $1.04 41.3%
Diluted $1.47 $1.04 41.3%
Weighted average
outstanding shares:
Basic 37,285 37,269 0.0%
Diluted 37,285 37,279 0.0%
OLD DOMINION FREIGHT LINE, INC.
Third Quarter Year to Date
------------------------- ------------------------
Operating
Statistics 2006 2005 % Chg. 2006 2005 % Chg.
------------------- ------------------------- ------------------------
Operating ratio 89.1% 89.5% (0.4%) 89.7% 90.8% (1.2%)
Intercity miles (a) 78,564 64,845 21.2% 222,260 191,371 16.1%
Total tons (a) 1,248 1,082 15.3% 3,653 3,114 17.3%
Total shipments (a) 1,646 1,476 11.5% 4,835 4,338 11.5%
Revenue per
intercity mile $4.30 $4.24 1.4% $4.32 $4.06 6.4%
Rev/cwt (b) $13.41 $12.76 5.1% $13.17 $12.53 5.1%
Rev/cwt excluding
fuel surcharges
(b) $11.65 $11.34 2.7% $11.56 $11.33 2.0%
Rev/shp (b) $203.20 $186.94 8.7% $198.96 $179.83 10.6%
Rev/shp excluding
fuel surcharges
(b) $176.61 $166.20 6.3% $174.65 $162.68 7.4%
Weight per shipment 1,515 1,465 3.4% 1,511 1,435 5.3%
Average length of
haul 930 919 1.2% 933 926 0.8%
(a)- In thousands
(b)- For statistical purposes only, revenue does not include
adjustments for undelivered freight required for financial statement
purposes in accordance with the Company's
September 30, December 31,
Balance Sheets 2006 2005
----------------------------------------------------------------------
(In thousands)
Current assets $267,454 $150,213
Net property and equipment 594,109 466,071
Other assets 28,324 25,364
------------- ------------
Total assets $889,887 $641,648
============= ============
Current maturities of long-term debt $12,774 $17,930
Other current liabilities 127,965 93,098
------------- ------------
Total current liabilities 140,739 111,028
Long-term debt 262,109 111,026
Other non-current liabilities 87,260 74,543
------------- ------------
Total liabilities 490,108 296,597
Shareholders' equity 399,779 345,051
------------- ------------
Total liabilities & shareholders' equity $889,887 $641,648
============= ============
Note: Financial statements and operating statistics are unaudited.
