UPDATE 1-Con-way profit falls, says competition hurts prices
(Adds details, background, company comment)
CHICAGO Oct 23 (Reuters) - U.S. trucking and logistics company Con-way Inc (CNW.N) on Tuesday posted a lower-than-expected net profit citing pricing pressure and lower yields in a highly competitive less-than-truckload market.
The San Mateo, California-based company also gave a full-year earnings outlook that came in below Wall Street analysts forecasts.
Con-way reported third-quarter net income of $37.3 million, or 78 cents a share, compared with $63.0 million, or $1.24 a share, a year earlier.
Excluding $7.0 million or 9 cents per share in charges related to acquisition and business initiatives in the third quarter, Con-way posted EPS of 87 cents.
Wall Street analysts, on average, had expected earnings of 97 cents per share for the quarter, according to Reuters Estimates.
Less-than-truckload (LTL) operators consolidate smaller loads into a single truck.
Commenting on the results in a statement Chief Executive Doug Stotlar described the market as "price sensitive," adding that "yields remain under a pressure, a dynamic that we expect will continue to dampen profit growth in LTL freight through the remainder of the year.
For the quarter Con-way reported revenue of $1.111 billion, up from $1.076 billion a year earlier. Analysts had expected revenue of $1.114 billion.
For the full-year Con-way said it expects EPS to be in a range from $3.07 to $3.17. The company said that forecast includes charges of 17 cents related to acquisition and business initiatives in the third and fourth quarters.
Analysts had forecast EPS for the full year of $3.47.
Con-way completed the acquisition of Joplin, Missouri-based truckload - or long-haul trucking - company Contract Freighters Inc for $750 million in August.
The U.S. trucking market has suffered from weak volumes since the third quarter of 2006, a slowdown that some analysts and industry insiders have termed a "freight recession."
That soft market has lead to many truckers to cut prices in a bid to win more business.
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