Swift Transportation submitted record quarterly operating revenue and operating income, finishing the fourth quarter with $922 million in revenue, outpacing last year’s result of $860 million.
Full-year operating revenue increased for the third year in a row in 2012, ending the year at $3.49 billion, another record. Last year’s total rose slightly from 2011’s revenue total of $3.33 billion.
Swift also surpassed its anticipated net-debt payoff for 2012, paying off $174 million instead of the target of between $50 million to $100 million.
In a call to investors, Swift officials commented on pricing during the fourth quarter, saying prices rose each month, with the largest price increase seen in November. These changes were driven by stronger volumes compared to the third quarter and were not impacted by Superstorm Sandy or any other related issues. These pricing impacts were felt across the board and weren’t limited to a particular region.
Officials are expecting a similar macroeconomic environment in 2013, but it’s still too early in the year to make any predictions about actual pricing. But with similar patterns in the economy, it’s reasonable to assume similar rate increases, they said.
Rate growth and seasonal projects account for a successful quarter for the company’s truckload segment. Operating revenue finished the year at $591.1 million, with an 86.9 percent operating ratio. Weekly revenue, excluding fuel surcharges, averaged out to $3,292. Operating and weekly revenue experienced strong gains over 2011 and 2010’s numbers.
Even with these numbers, Swift is keeping a careful eye on its fleet size.
“We continue to monitor the freight environment and expect to adjust our truck count to match market conditions,” the company wrote in a letter to investors. “As a result, we expect our first-quarter truck count in our truckload segment to be relatively flat from the fourth quarter of 2012.”
According to a BB&T Capital Markets analysis, Swift Transportation expects net capital spending in 2013 of $250 million. Intermodal revenues will grow by 20 percent to 25 percent, with growth coming in the first half of the year, a continuation of strong volumes at the end of 2012. - Jon Ross