ODFL issues November operating metrics

Thomasville, N.C.-based national less-than-truckload (LTL) carrier Old Dominion Freight Line (ODFL) provided guidance for key operating metrics for the month of November.

ODFL reported that revenue per day fell 0.9% compared to November 2022, which it said was mainly driven by a 2.3% decrease in LTL tons per day that was partially offset by an increase in LTL revenue per hundredweight. And it added that the change in LTL tons per day was attributed to a 2.9% decrease in LTL weight per shipment that was partially offset by a 0.6% increase in daily LTL shipments.

For the quarter-to-date period, ODFL reported that LTL revenue per hundredweight and LTL revenue per hundredweight, excluding fuel surcharges, was up 1.3%, and 7.6%, respectively, compared to November 2022.

“The decrease in our November revenue reflects continued softness in the domestic economy,” said Marty Freeman, President and Chief Executive Officer of Old Dominion, in a statement. “We were pleased, however, to see both the continued improvement in our yield metrics and a slight increase in our LTL shipments per day. We will continue to focus on delivering superior service at a fair price to support our consistent, cost-based approach to yield management. Our ability to execute on this fundamental element of our long-term strategic plan has created an unmatched value proposition in our industry, which we believe will also continue to support our ongoing ability to win long-term market share.”

In a previous interview, ODFL CEO Adam Satterfield explained that ODFL pays a lot of attention to the ISM [manufacturing] index, which has been below 50 (a reading of 50 or higher indicates growth is occurring) for several months now. 

“We are kind of getting to the end of what a normal average down cycle might be…and would look to start seeing some industrial strength returning,” he said. “And industrial related revenue is about 60% of our overall revenue base. But, I think, right now, we're going to start seeing some things turn around with our retail customer, base as well, which is about 30% of overall revenue. And we still believe, in looking at things like the inventory-to-sales ratio, that inventory levels are low.

They are still below where we were before the pandemic, and then we've had feedback from customers that kind of supported our belief of freight flowing again, suggesting that that they're going to see an increase in their shipment levels this year. So, you know, it's somewhat reading the economic tea leaves, but really a lot of our base level forecasting comes from feedback that we get from our customer base. In the fall each year, we go through a robust forecasting process and build a bottoms-up forecast, taking data that our sales team are able to get from our customer base. And, so, it's taking all that information into account as we go through our planning process.”

In its third quarter earnings, ODFL revenue was down 5.5% annually, to $1.515 billion.