Con-way profit misses Street on employee benefit costs
(Reuters) - U.S. trucking and logistics company Con-way Inc (CNW.N) reported a quarterly profit that fell short of Wall Street's and its own expectations due to higher employee benefit costs, sending its shares down 5 percent in extended trading.
Trucking companies, worried that they cannot afford pay enough to retain experienced drivers and entice new ones, have been offering non-salary inducements.
Operating income at Con-way Freight, the company's less-than-truckload unit that accounts for more than 60 percent of total revenue, fell 15.4 percent to $34.4 million in the third quarter. Con-way Freight's revenue rose 1.8 percent to $858.3 million.
In less-than-truckload (LTL) shipping, the company picks up loads, sorts them and makes various deliveries. This differs from truckload, in which one driver picks up a load and stays with it through to its final destination.
Con-way's net income fell to $25.3 million, or 45 cents per share, in the third quarter, from $29.1 million, or 52 cents per share, a year earlier.
Excluding special items, profit was 45 cents a share.
Revenue for the Ann Arbor, Michigan-based company rose 2 percent to $1.40 billion.
Analysts' on average had expected earnings of 59 cents per share on revenue of $1.44 billion, according to Thomson Reuters I/B/E/S.
In the logistics segment, revenue rose 2.6 percent to $427.8 million on higher revenue from transportation management services, Con-way said.
Empty miles was unchanged at 9.5 percent from a year earlier, while loaded miles fell 1 percent.
Con-way shares, which have lost 23 percent since hitting a year high on June 19, were down at $27.55 in extended trading. They closed up 4 percent at $29.11 on the New York Stock Exchange on Wednesday.
The company's earnings announcement was delayed by a day due to hurricane Sandy, which closed financial markets for two days. Con-way is holding a conference call with analysts on Thursday.
(Reporting by Tej Sapru in Bangalore; Editing by Maju Samuel)