Celadon Group Inc. reported its financial and operating results for the three and six months ended Dec. 31, 2006, the second fiscal quarter of the company’s fiscal year ending June 30, 2007.
For the quarter, revenue increased 2.2% to $122.9 million in the 2006 quarter from $120.3 million in the 2005 quarter. Freight revenue, which excludes fuel surcharges, was up 4.5% to $107.5 million in the 2006 quarter from $102.9 million in the 2005 quarter. Net income increased 27.1% to $6.1 million in the 2006 quarter from $4.8 million for the same quarter last year. Earnings per diluted share improved by 23.8% to $0.26 in the 2006 quarter from $0.21 for the same quarter last year.
For the six months ended Dec. 31, 2006, revenue increased 5.2% to $250.6 million in 2006 from $238.2 million for the same period last year. Freight revenue was up 4.3% to $215.1 million in 2006 from $206.2 million for the same period last year. Net income increased 38.9% to $13.2 million in 2006 from $9.5 million for the same period last year. Earnings per diluted share increased 36.6% to $0.56 from $0.41 the same period last year.
Chairman and CEO Steve Russell commented on the quarter: ‘We are pleased with the results of the December quarter, during what turned out to be a more challenging freight environment than the industry has seen in the past several years. Our average revenue per loaded mile, excluding fuel surcharge, increased by 4.0%, to $1.55 from $1.49, while average revenue per total mile, excluding fuel surcharge, improved 2.2%, to $1.40 from $1.37. Reduced miles per week per truck and increased deadhead, were both a result of the decline in freight levels during the latter part of the quarter. As a result of excellent drivers, disciplined management and strong cost control, our operating ratio (defined as operating expenses, net of fuel surcharge, as a percentage of freight revenue) improved 260 basis points to 89.8% from 92.4%.
‘On Oct. 6, 2006, the company acquired certain assets of Digby Truck Lines. The on-boarding of Digby’s former customers and drivers was successfully accomplished during the quarter. We are in the process of disposing of the older tractors and trailers that we are not intending to retain.
‘We believe capacity in our industry continues to be constrained by a shortage of qualified drivers. We address the driver shortage by recruiting safe and experienced drivers, providing newer equipment, and offering competitive compensation and lifestyle programs. We believe our continued commitment to the quality of life of our drivers helps keep our trucks seated, reduces our costs, improves customer service and contributes to improved safety for the driving public.
‘We believe carefully managing the average age of our fleet allows us greater flexibility in addressing the cost and reliability issues involving tractor engines designed to comply with stricter emissions requirements in 2007 and generally lowers our operating expenses.’