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Covenant Posts Third Quarter Loss

Tennessee-based Covenant Transportation Group posted a third quarter loss of $13.6 million, or 96 cents a share, compared to a $3.4 million loss, or 24 cents a share, in the third quarter of 2008

by Staff
October 27, 2009
Covenant Posts Third Quarter Loss

 

1 min to read


Tennessee-based Covenant Transportation Group posted a third quarter loss of $13.6 million, or 96 cents a share, compared to a $3.4 million loss, or 24 cents a share, in the third quarter of 2008.



According to the faith-based truckload carrier, the loss includes a non-cash impairment charge of $11.6 million related to investments in Transplace, a non-asset based third party logistics provider.

The company's total revenue fell 28 percent to $153 million, from $212.5 million in the year-ago quarter. The company attributes the drop to lower fuel surcharge revenue.

Freight revenue, which excludes fuel surcharges was $133.3 million, down 18.2 percent from $162.9 million in the 2008 quarter.

"The balance of $29.6 million in total revenue decrease as compared to the third quarter of 2008 related to lower freight revenue arising, in large part, from a reduction in loads and severe pressure on freight rates as a result of the economic recession," said David Parker, chairman, president, and CEO. "In anticipation of lower freight volumes, we proactively reduced our average tractor fleet by approximately 322 trucks versus the third quarter of 2008."

The company has implemented other cost-reduction measures, including cuts to salaries, wages, and benefits expense.

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