USA Truck (USAK) Misses Q2 EPS Views; Provides Outlook

USA Truck (NASDAQ: USAK) reported Q2 EPS of ($0.21), $0.40 worse than the analyst estimate of $0.19. Revenue for the quarter came in at $109.9 million versus the consensus estimate of $113.18 million.

Outlook

Given the deterioration in industry conditions in the past quarter and lower volumes with certain dedicated customers, Trucking’s adjusted operating ratio is unlikely to improve by up to 200 basis points this year compared to 2015 as the Company had previously anticipated. Going forward, the Company will focus on improving its base rate per loaded mile, improving the productivity of its sales force, and better utilizing its tractors as it continues to build density in its more focused network. Although conditions in the third quarter remain difficult, the Company has seen indications that rates are stabilizing. The Company has also made progress in increasing the amount of committed freight it handles and continues to win additional new business in line with its greater focus on serving customers in more profitable lanes.

The Company believes that it will be able to report an improved Trucking adjusted operating ratio for the second half of the year compared to the first half. The Company remains committed to its goal of achieving an adjusted operating ratio of 90%, but expects the timeframe to achieve that may be delayed past the fourth quarter of 2017, as previously announced. Achieving this goal depends on the improvement of industry fundamentals, continued streamlining of its fleet and network, and continued reduction in controllable costs. The Company continues to work toward its goal of having USAT Logistics revenue account for 50% of the Company’s consolidated operating revenue.

For earnings history and earnings-related data on USA Truck (USAK) click here.

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