PAM Transportation, an irregular route trucking company based in Arkansas, North America has reported record profits in the third quarter, 2014.
Stronger freight demand and lower fuel costs helped PAM to reach its latest figures, with the company posting a net income of $5.06m, a 111% gain on the $2.39m posted in Q3 2013.
Earlier this week, CEO, Daniel Cushman said: "The current level of demand allows us to be more selective in choosing lanes which offer both driver satisfaction and higher returns. As a result, we have been able to further reduce the number of empty miles driven as well as recognise an increase in the average revenue per truck each day. These efficiency gains have a significant impact on bottom line results."
The company's dedicated automotive business has been especially strong in 2014, and has seen growth in the Mexico region. "The expedited division continues to improve in terms of profitability and we have experienced decreasing driver turnover," said Cushman. "Our dedicated division is growing and the driver turnover is much lower in this division than the company average. Another driver friendly division, our Mexico division, is also growing and profitable."
PAM's logistics business is also growing. Cushman said that although the logistics division is currently a small part of the business, it continues to grow and operate more profitably as the company develops its model and offer customers additional capacity solutions. The logistics division accounted for $6.12m of the total company revenue in Q3, and segment revenue grew from $5.31m in Q3 2013.
The company's operating revenues (including fuel surcharges) increased 5.1% to $107.06m for Q3, which was up from $100.88m last year. The increase is due to more than 6,500 extra loads being carried when compared to 2013. PAM's trucks travelled 54.12m miles in the third quarter, compared to 53.13m miles in the third quarter 2013, and the revenue generated by each truck, per day increased to $673, an increase from $644 in 2013. Empty miles covered by trucks were down at 6.65%, from 7.06% in 2013.
PAM – either Paul Allen Maestri, according to the company's website, or Pretty Awesome Mileage according to Hoovers financial data – currently serves the lower continental states and the southern parts of Ontario, Canada. It also provides services in Mexico under agreements with several Mexican trucking carriers. Primarily, PAM works with clients in the automotive industry, with its freight consisting of automotive parts, general commodities, and heating and air conditioning units.
The company operates a fleet of more than 1,700 trucks, and 4,000 trailers. Most of its trucks are Freightliner and International, and it hauls dry-van trailers that are 53ft (16m) in length.
Moving forward, Cushman wants to see further growth in the company, but admitted that there are challenges. One challenge that is currently affecting the trucking industry is a lack of drivers, but this is one area where PAM believes it has an advantage by being "driver friendly" regarding pay, miles, home time, and new trucks. "We also continue to review our driver compensation package in order to retain our current drivers and attract new drivers," said Cushman. "Our ability to attain our driver recruitment and driver retention goals will be vital to growth in top-line revenues."