U.S. Xpress Enterprises Inc. on Thursday reported a bigger-than-expected loss of $11.2 million in its fourth quarter, but company CEO Eric Fuller said a realignment of the company's truckload has been completed and should boost profits as the market improves.
The Chattanooga-based trucking company reported adjusted losses of 18 cents per share, which was above the average 12 cents-per-share loss predicted by four analysts surveyed by Zacks Investment Research.
U.S. Xpress reported better-than-expected revenues in the fourth quarter of $542.5 million, however, and generated record operating revenues for all of 2022.
Fuller said the company has "identified significant fixed costs that we are taking out of the business, and realigned our truckload segment to improve operating profitability going forward."
"In the fourth quarter, sequential rate pressure from our spot market exposure and higher fuel costs more than offset the positive contributions from our dedicated and brokerage businesses as well as the progress made from our realignment plan," Fuller said in the company's quarterly earnings report released after the market closed Thursday. "In 2023, we will continue to focus on execution, servicing our customers at a high level and reducing our spot market exposure. We believe the benefits from these initiatives, combined with our lower fixed cost structure, will become apparent as the market turns."
The company's realignment plan cut fixed costs by $32 million last year, Fuller said. Last year, U.S. Xpress cut its staff by 140 employees and closed its Variant office in Atlanta, among other cost-cutting moves.
The truckload segment had an operating loss of in the fourth quarter of $11.9 million, up 44.5% from the previous year, due primarily to the company's spot market exposure. Combined with weaker overall freight volumes, the spot market caused the average revenue per mile in the over-the-road division to decrease by 6 cents per mile in the fourth quarter, Fuller said.
Ahead of the earnings announcement after the market closed, the stock price of U.S. Xpress fell by 2 cents a share to $1.58 per share in trading Thursday on the Nasdaq exchange to close at the lowest price for the company so far this year.
Over the past 12 months, shares of U.S. Xpress are down 57.5%.
— Compiled by Dave Flessner