Con-way’s first quarter results came in below expectations, with the carrier turning in net income of $14 million, an $11.6-million decline compared to the first quarter of 2012.
Revenue dropped from $1.37 billion to $1.34 billion, and operating income was down by more than $24 million.
Douglas W. Stotlar, the carrier’s president and chief executive officer, called the results disappointing, but also said the company’s margins are moving in the right direction. He blamed short-term cost items for the poor results, and he added Con-way is making headway on cost-saving initiatives.
“We have made encouraging progress on the key initiatives of lane-based pricing and line-haul efficiency, both of which are foundational to our three-year plan,” he said in a statement. “As these initiatives ramp up during 2013, we continue to expect improved financial performance, particularly in the second half of the year.”
Menlo Worldwide Logistics experienced a 0.9-percent uptick in net revenue during the quarter, ending the three-month period at $157.2 million, but operating income was nearly cut in half due to new customer start-up costs and increased information technology expenses.
Con-way Freight experienced a modest decline in revenue due to a shortage of working days and a lower average daily tonnage. Yield, excluding fuel surcharge, rose by 3.4 percent. Operating income declined from $34.5 million in the first quarter of 2012 to $16 million so far in 2013.
A 3.3-percent increase in revenue per loaded mile offset other challenges for the carrier’s truckload segment, resulting in a relatively small $300,000 drop in revenue for the quarter. Operating income dropped by $600,000, year over year. - Jon Ross