Operating Ratio Improves 20 Basis Points to 85.7% THOMASVILLE, N.C.-- Old Dominion Freight Line, Inc. (NASDAQ: ODFL) today announced financial results for the three-month period ended March 31, 2017, which include the following:
  Three Months Ended  
March 31,  
(In thousands, except per share amounts) 2017   2016 % Chg. 
Revenue $ 754,096   $ 707,733 6.6 %
Operating income $ 108,122 $ 99,548 8.6 %
Operating ratio 85.7 % 85.9 %
Net income $ 65,792 $ 60,285 9.1 %
Diluted earnings per share $ 0.80 $ 0.72 11.1 %
Diluted weighted average shares outstanding 82,444 83,983 (1.8 )%
"Old Dominion produced solid financial results for the first quarter of 2017, with improvements in both our revenue and operating ratio," said David S. Congdon, Vice Chairman and Chief Executive Officer of Old Dominion. "Our revenue growth was driven by a 4.9% increase in LTL revenue per hundredweight and a 2.4% increase in LTL tons per day for the quarter. LTL revenue per hundredweight, excluding fuel surcharges, increased 2.4% even as the changes in the mix of our freight put downward pressure on this yield metric. "Our operating ratio in the first quarter of 2017 improved slightly as compared with the first quarter of 2016. Reductions in our insurance and claims costs and variable operating costs as a percent of revenue offset the increase in depreciation expense resulting from our continued investments in real estate, equipment and technology. These investments, along with the extraordinary efforts of our entire Old Dominion family of employees, enabled us to continue to provide outstanding customer service, with on-time deliveries of more than 99% and a Company record cargo claims ratio of 0.2%." Cash Flow and Use of Capital Old Dominion's net cash provided by operating activities was $110.8 million for the first quarter of 2017 compared to $168.4 million for the first quarter of 2016, with changes in working capital accounts primarily driving the difference. The Company had $47.6 million in cash and cash equivalents at the end of the first quarter, and its debt-to-total capitalization was 4.7% compared with 6.9% at March 31, 2016. Capital expenditures were $57.0 million for the first quarter of 2017. The Company continues to expect capital expenditures for 2017 to total approximately $385 million, including planned expenditures of $185 million for real estate and service center expansion projects, $155 million for tractors and trailers, and $45 million for technology and other assets. Old Dominion returned $8.3 million of capital to its shareholders in the first quarter of 2017. Of this total, $8.2 million was in the form of dividends, as the Company made its first ever regular quarterly cash dividend payment of $0.10 per share. The Company also remains committed to the disciplined management of its ongoing share repurchase program, and at the end of the first quarter it had approximately $199.9 million remaining under its current $250.0 million stock repurchase program. Summary Mr. Congdon concluded, "We are encouraged by the increased economic momentum observed in the first quarter, which supported the increases in freight density and yield that helped us improve our operating ratio. Given our premium service offering and network capacity, we are well-positioned to leverage the opportunities that a growing economy would produce. Regardless of the operating environment, we remain fully committed to our proven business model and are confident that by continuing to deliver a value proposition of superior customer service at a fair price, we can produce additional long-term growth in market share and shareholder value."