U.S. Xpress Enterprises Inc., Chattanooga, Tenn., reported results for the three months ended March 31, 2005.

Revenue for the first quarter of 2005 increased 14.7% to $269.1 million compared to $234.7 million in the first quarter of 2004. The company experienced a net loss of $2.1 million, or $0.13 per share in the 2005 quarter, compared with net income of $800,000, or $0.06 per diluted share, in the first quarter of 2004. The results announced Monday are consistent with the guidance issued in the company's March 30, 2005 press release.
Nevertheless, the Chattanooga Times Free Press reported Wednesday that shares of U.S. Xpress Enterprises Inc. fell by $1.77 per share Tuesday and closed at $12.13, its lowest level since August 2003. The nearly 13% stock plunge came a day after the Chattanooga-based trucking company posted the quarterly loss. According to the paper, U.S. Xpress shares had falled from a peak of $33.70 reached on Feb. 8 by 64%, cutting the market value of the company by more than $350 million.
The U.S. Xpress quarterly news release said that truckload revenue for the first quarter of 2005, excluding the effect of fuel surcharges, increased 8.7% to $215.1 million, despite an 8.4% decline in the average number of tractors in the fleet. This growth in revenue was driven by a 9.8% increase in revenue per loaded mile and increased revenue from the company's expedited rail business which offset, in part, the impact of the decline in the average number of trucks.
Truckload operating income for the quarter was $1.6 million compared to $3.4 million in the 2004 first quarter. Truckload results were negatively impacted by softer than expected freight demand, higher operating costs, including record high fuel prices, and difficulty in attracting drivers, which resulted in an approximately 2% sequential decline in average seated tractors, when compared to the fourth quarter of 2004. The higher fuel cost, net of the impact of fuel surcharges, negatively impacted quarter-over-quarter operating income by approximately $2.0 million, or $0.07 per share.
Xpress Global Systems' revenue increased 19.2% as a result of year-over-year growth in revenues in both airport-to-airport and floor covering transportation services. Xpress Global reported an operating loss of $3.5 million in the quarter compared to operating income of $230,000 in the first quarter of 2004. Results of this segment were negatively impacted by the performance of our airport-to-airport operations.
Arnold Transportation, in which the company acquired a 49% equity interest in December 2004, experienced a 20% increase in revenues to $51.0 million, compared to the prior year period, and achieved an operating ratio of approximately 95.5%. Arnold contributed to our pretax income for the quarter. The company also owns a 41% interest in Total Transportation of Mississippi, which it acquired in April 2005. Together, these affiliated companies currently operate approximately 2,000 tractors providing regional and medium length of haul and dedicated dry van truckload services, primarily in the eastern United States.
Co-Chairman, Patrick Quinn, stated, "Historically, the first quarter has represented our most difficult quarter due to a seasonally softer freight market in each of our business segments. Consequently, the last three quarters of the year generally have contributed a disproportionate share of our profits. Looking forward, we expect to achieve substantial improvements over the first quarter in operating performance in both our U.S. Xpress truckload and Xpress Global operations. Although we are disappointed with the first quarter results, we are encouraged by the improved operating trends we are currently experiencing in our Xpress Global operations. We anticipate that demand for our truckload services will improve while capacity growth in the truckload sector should be restrained as, driver availability, among other factors, continues to be very tight."