JB Hunt profit jumps 41%

JB Hunt Transport Services Inc. reported second quarter profit of $ 172.2 million on Monday, up 41% from last year.

The results, which executives said were based on solid performance and growth earlier this year, exceeded Wall Street analysts’ expectations.

Revenue increased 35% to $ 2.91 billion from the same quarter last year. All of JB Hunt’s business segments grew at least double digits in the three months ending in June.

Lowell-based trucking and logistics provider attributed profitability to customer rate and cost recovery efforts, higher volumes, technology investments, higher productivity and profit of $ 3.2 million. dollars resulting from the settlement of claims in its last mile activity.

Meanwhile, JB Hunt had increased costs and expenses which undermined results, including higher salaries for drivers and a lack of network fluidity for rail and customer activity in its largest business segment.

Despite these challenges, executives at JB Hunt said on a conference call how satisfied they were with each business segment during the quarter.

After a year of delays and setbacks brought on by the coronavirus pandemic, JB Hunt began to raise the bar in 2021, recording strong profit and revenue growth for the first time since the start of the pandemic.

With consecutive growth in the second quarter, the company can build on its current momentum, said John Roberts, President and CEO of JB Hunt.

Intermodal, which accounts for about half of the business, experienced strong demand which was offset by restrictions from rail service providers related to labor shortages, railcar imbalances and other challenges. With these issues in mind, JB Hunt generated intermodal revenue of $ 1.29 billion, a 21% increase from last year. Sector revenue increased 26% to $ 133.6 million.

JB Hunt’s Integrated Capacity Solutions segment recorded the highest percentage revenue growth, followed by Truckload and Final Mile.

Integrated Capacity Solutions, a non-asset-based company, generated sector revenue of $ 607 million, up 100% from last year, due to increased volumes and prices higher contractual and cash. Revenue per load jumped 66%.

Segment income amounted to $ 3.1 million compared to a net loss of $ 13.1 million.

Dedicated Contract Solutions generated sector revenue of $ 621 million, up 17% from last year due to higher productivity. JB Hunt added 555 new trucks to its fleet, a quarterly record.

Meanwhile, segment revenue fell 5% to $ 79 million due to wage increases for drivers and employees, among other costs.

Final Mile Services generated segment revenue of $ 212 million, up 52% ​​on more customer contracts. The segment, which delivers bulky and bulky cargo to residences, has faced temporary suspensions of covid-19.

Last mile income was $ 10.7 million compared to a net loss of $ 5.2 million in the same quarter last year.

The Truckload segment generated revenue of $ 184 million, up 70% as more customers became accustomed to JB Hunt 360, a digital platform that allows users to access the capacity of trailers across the entire company network.

Segment income jumped 308% to $ 14.2 million in the quarter.

“Overall this looks like a strong quarter,” Justin Long, Stephens transportation analyst, said Monday in a research note.

The results exceed Stephens’ estimate of earnings by $ 1.57 per share. Other analysts were expecting $ 1.58, according to a FactSet consensus.

“For the future, the dynamics of intermodal pricing, the new dedicated contracts and the inflection of [Integrated Capacity Solutions] profitability all paved the way for momentum to build, ”Long added.

On the cash flow side, JB Hunt still had $ 1.3 billion to pay on various debt instruments at the end of the quarter.

Net capital expenditure was $ 261 million and JB Hunt had $ 571 million in cash.

The company spent $ 81 million to repurchase 484,000 of its own shares during the quarter.

JB Hunt shares fell $ 5.27, or 3.2%, to close Monday at $ 159.68 on the Nasdaq stock exchange. Shares have hit $ 183.80 and as low as $ 119.22 in the past year.