Cannon Express Financial Problems Grow, Morgan Group's Losses Mount
Cannon Express and The Morgan Group are among carriers who continue to struggle with financial losses
Cannon Express and The Morgan Group are among carriers who continue to struggle with financial losses.
Cannon Express, Springdale, Ark., Wednesday announced the results of its third fiscal quarter, which ended March 31.
Revenues for third fiscal quarter 2002 were $18.53 million, compared to $20.85 million in the third fiscal quarter of 2001.
Net loss was $2.37 million, compared to a net loss of $795,777 in the third fiscal quarter of 2001.
The company said results were affected by a soft freight market and a shortage of qualified drivers.
In March, Cannon laid off about a fourth of its non-driving administrative staff, and cut other administrative costs, eliminating approximately $2.5 million in annual expense. The company says it has a plan to increase utilization of equipment and improve profitability, however, they note there is no assurance they will be successful in increasing revenues to the level of profitability in the near future.
The Morgan Group, Elkhart, Ind., the parent of mobile home, recreational and commercial vehicle hauler Morgan Drive Away, announced operating results for the first quarter ended March 31.
Revenues for the first quarter decreased by $7.4 million or 31% to $16.3 million from $23.7 million in the first quarter of 2001.
The operating loss was $1.43 million for the quarter, compared to an operating loss in the first quarter 2001 of $475,000.
Net loss before the cumulative effect of an accounting change for the quarter was $378,000 compared to a loss of $541,000 in 2001.
"We continue to operate in a mixed revenue environment," said President and CEO Anthony T. Castor III. "The manufactured housing industry continues to be sluggish for the first quarter, down slightly from a year ago. The recreational vehicle industry is flourishing. We are confident that our extensive cost reductions as well as our aggressive sales programs have positioned the company for a return to profitability this year."
Units shipped, as reported by industry associations, indicate that manufactured housing shipments were relatively flat compared to a year ago, while recreational vehicle industry shipments were up 7.8% in the past year.
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