The supply chain disruptions may be causing retailers more empty shelves than consumers would like, but J.B. Hunt Transport Services just completed a banner third quarter.
“This year, we have reached all-time highs in the need for company drivers in all segments,” J.B. Hunt Chief Executive John Roberts reportedly said.
The Arkansas-based trucking outfit recently reported 2021 third-quarter net earnings of $199.8 million. That figure exceeds the same period in 2020 by upwards of 59 percent, with total revenue nipping $3.14 billion. What has organizations such as J.B. Hunt particularly optimistic is that net earnings far exceeded the year-over-year revenue growth that was only 27 percent higher. It may seem counterintuitive, but freight carriers such as J.B. Hunt that planned for an energetic rebound to the pandemic positioned themselves for tremendous gains.
“At the beginning of the year, we had announced a heavy investment in equipment for 2021. While all orders remain in place, the constraints noted have limited our ability to in-service this equipment. Through unconventional means, including leasing our own private vessels, we are able to add just shy of 3,000 JBI containers and over 900 JBT trailers during the quarter, as well as having success in sourcing our tractor needs as a result of solid relationships with our equipment manufacturers,” J.B. CFO John Kuhlow reportedly said.
J.B. Hunt reportedly employs more than 24,000 people, operates upwards of 12,000 trucks, and enjoys a fleet of more than 100,000 trailers.
In some ways, the bottlenecks along California’s ports have been something of a mixed blessing, in terms of profitability. Freight hauling operations have been pedal to the metal since states loosened business restrictions and demand for trucking and logistics professionals has risen to a premium.
“While peak season is upon us, we believe the bottlenecks on the West Coast are going to compact and even intensify further peak-season capacity needs into November and December,” Shelley Simpson, J.B. Hunt’s chief commercial officer, reportedly said.
J.B. Hunt is not alone in posting significant third-quarter earnings. P.A.M. Transportation Services, also based in Arkansas, posted a strong third quarter that ended Sept.30. P.A.M. enjoyed a net income of more than $2.14 million, a figure that triples its third quarter in 2020.
Although J.B. Hunt and P.A.M are enjoying banner years, the supply chain logjams may have hampered earnings, to some degree. These and other operations saw retailer demand skyrocket by as much as 85 percent from 2020. That translated into a 400 percent rise in operating income in that space. But overcrowded rail systems and container retention by customers hamstrung the transportation sector from achieving its full potential. With more qualified truckers in the workforce and a smooth running supply chain, freight carriers could do even better going forward.
Sources: freightwaves.com, ttnews.com
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