Photo by Jim Park.

Photo by Jim Park.

J.B. Hunt Transport Services Inc. (JBHT) on Friday announced an increase in its second quarter 2015 net earnings to $103.4 million, or diluted earnings per share of 88 cents.

This compared to second quarter 2014 net earnings of $93.4 million, or 79 cents per diluted share, for the Arkansas-based trucking and intermodal freight transportation provider.

Total operating revenue for the quarter was $1.54 billion, compared with $1.55 billion for the second quarter 2014.

Rate increases, intermodal load growth of 2%, a 6% increase in revenue-producing trucks in its dedicated operation plus 12% load growth in its brokerage unit could not offset the decrease in fuel surcharge revenue, sluggish consumer freight demand, and lower equipment utilization in its trucking business segment, according to the company.

These factors resulted in flat consolidated revenue compared to prior year. However, total operating revenue excluding fuel surcharges increased 7% compared to the second quarter of 2014.

Operating income (profit before interest and taxes), for the current quarter totaled $174 million compared to $159 million for the second quarter of last year.

The company attributed this primarily to rate increases, less reliance on outsourced intermodal drayage and dedicated service coverage, load growth, freight mix changes and improved fuel economy.

However, it said this was partially offset by an approximate $14.1 million charge for corporate-wide "streamlining and technology redevelopment costs" (the benefits of which are expected to be realized over the next two fiscal years), lower box turns from slower train velocities, higher driver recruiting and retention costs, higher workers’ compensation costs, and increased toll costs compared to second quarter 2014.

J.B. Hunt’s intermodal business saw revenue decline 3% to $905 million but operating income increased 5% to $118.6 million.

“The lingering effects of disruptive shipping patterns due to the West Coast port issues, slow rail service recovery and a softer consumer-driven freight demand all contributed to slower load volume growth,” the company said in a release.

Another factor may have been the intermodal marketing company’s own decision to sacrifice market share for higher rates, according to a BB&T Capital Markets report, reports Journal of Commerce.

Its dedicated operation saw revenue increase 5% to $367 million, while operating revenue  jumped by a much larger margin, 34%, to $40.6 million.

“A net additional 413 revenue-producing trucks, approximately 58% representing private fleet conversions versus traditional dedicated capacity services, were in the fleet by the end of the quarter compared to prior year, primarily from new contract implementations in the current and prior periods,” the company said.

Second quarter revenue in the company’s truck division fell 3.5% to $98 million while operating income increased 3% to $9.7 million, as it operated 2,073 tractors compared to 1,860 a year ago.

J.B. Hunt’s brokerage division, Integrated Capacity Solutions, saw a 0.6% increase in revenue to $174 million, but operating income fell 21% to $4.9 million.

“Volumes increased 12% while revenue per load decreased 10%, primarily from lower fuel prices and less transactional customer demand versus second quarter 2014” the company said.

More information is on the J.B. Hunt website.