Old Dominion Freight Line, Inc. (ODFL) announced its financial results for the third quarter of 2024, reflecting a challenging economic environment and strong comparable results from the previous year.
Despite the headwinds, the company maintained its focus on improving operational efficiency and delivering best-in-class service to its customers.
CEO Marty Freeman acknowledged the impact of the broader economic downturn on Old Dominion’s financial performance, highlighting that the company’s third-quarter revenue decreased by 3.0% year-over-year, driven by a 4.8% drop in less-than-truckload (LTL) tons per day.
However, a 1.5% increase in LTL revenue per hundredweight helped offset the volume decline. The company also maintained its market share while improving yield performance through disciplined pricing and operational efficiency.
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Key Financial Metrics
Revenue for Q3 2024 decreased to $1.56 billion, down from $1.61 billion in the same period last year.
Earnings per diluted share fell 7.1% year-over-year to $1.43, primarily due to higher operating costs and a 210-basis point increase in the operating ratio to 72.7%.
Operating costs, particularly related to health and dental plans, saw an uptick, contributing to a 110-basis point increase in overhead expenses as a percentage of revenue.
Freeman emphasized the consistency of Old Dominion’s customer service, with 99% on-time deliveries and a cargo claims ratio of just 0.1%.
“These metrics highlight our continued focus on quality service, which remains a key differentiator in the marketplace,” Freeman said.
Additionally, Old Dominion generated $446.5 million in net cash from operating activities in Q3 2024, bringing the total for the first nine months of the year to $1.3 billion.
The company ended the quarter with $74.2 million in cash and cash equivalents. Capital expenditures reached $242.8 million for the quarter, bringing the total for the first nine months to $600.4 million.
Old Dominion expects full-year capital expenditures to reach $750 million, with significant investments allocated for real estate and service center expansion, new tractors and trailers, and information technology infrastructure.
Q3 Shareholder Returns of Old Dominion Hit $824.8M in Buybacks, $168.2M in Dividends
Old Dominion continued its shareholder return initiatives in Q3, repurchasing $824.8 million in stock over the first nine months, including a $200 million accelerated share repurchase program set to conclude in November. The company also paid out $168.2 million in dividends during the same period.
Freeman reiterated Old Dominion’s commitment to its long-term strategic plan, centered on providing superior service at competitive prices.
“Our strategy has always been about delivering value to our customers and, in turn, creating long-term growth and shareholder value,”
Old Dominion Freight Line CEO, Marty Freeman
He remains confident that the company’s disciplined approach to pricing and service excellence will help it navigate the current economic challenges while positioning Old Dominion for continued success.
Despite the revenue decline, Old Dominion’s management remains optimistic about future growth opportunities, particularly as it continues to invest in capacity, technology, and workforce development.
Finally, as Old Dominion navigates the current economic environment, the company remains committed to executing its long-term business strategy.
With a strong focus on service quality and disciplined operational practices, Old Dominion aims to maintain its market leadership and drive shareholder value.
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