ArcBest Corp shares experienced a downturn after the company announced its third-quarter 2024 financial outcomes, which fell short of market expectations. The company's revenue for the quarter decreased by 5.8% year-over-year, amounting to $1.06 billion, missing the anticipated $1.07 billion. Examining segment performance, the Asset-Based segment reported $707.7 million, reflecting a daily drop of 5.8%, while the Asset-Light segment accounted for $385.3 million with a daily decline of 9.6%. Total tonnage per day in the Asset-Based segment witnessed an 11.3% fall, and shipment volume contracted by 0.7% compared to the previous year.
Despite these challenges, pricing momentum within the quarter remained robust, owing to a general rate increase of 5.9% initiated on September 9, alongside contract renewal hikes of 4.6%. The less-than-truckload (LTL) industry pricing stayed rational throughout this period. However, Asset-Light revenues were adversely affected by reduced shipment rates and a higher proportion of smaller managed transportation shipments. Though there was a dip in daily shipments, productivity saw a notable improvement, with a 19.5% increase in shipments per employee year-over-year, which showcases operational efficiency.
Nevertheless, ArcBest faced ongoing challenges from soft freight conditions and excess capacity, impacting its financial health. Adjusted EBITDA from continuing operations dropped to $86.404 million from $101.59 million compared to the prior year. The adjusted earnings per share (EPS) were $1.64, falling short of the forecasted $1.83, and considerably down from last year's $2.31 per share. Despite this financial downturn, ArcBest's operating cash flow over the past nine months reached $229.05 million, an improvement from $194.76 million in the prior year. By the end of September, the company's cash and equivalents stood at $150.46 million.
Judy R. McReynolds, ArcBest's chairman and CEO, emphasized the significant progress the company has made over the past year in controlling costs, boosting productivity, and enhancing service quality. These initiatives have earned ArcBest recognition from Mastio, surpassing the industry benchmark for service excellence. On the trading front, ArcBest’s shares were down by 5.22%, trading at $98.96 in pre-market activity during the last check on Friday. In other market news, discussions continue about potential candidates to replace Gary Gensler as the SEC Chair after upcoming elections, stirring interest in the finance community.
