We expect gradual operating ratio improvement over the next two to three years, supported in part by leverage from pricing gains, modest tonnage growth, and a more favorable labor deal.
Favorable pricing in LTL shipping is likely to persist, given tightening capacity in the broader trucking market and rational rate setting among market participants.
Arkansas Best's recent acquisition of Panther Expedited provides diversification into higher-margin, asset-light operations and new end markets not currently serviced by its core LTL operations. Read more
Arkansas Best's LTL trucking operations are capital-intensive, and union contracts (wage inflation) and mandatory payments to multi-employer pension funds create a sticky cost structure.
The company competes with industry heavyweights FedEx and UPS. Both have materially increased their presence in LTL shipping over the past decade.
Although Arkansas Best can generally pass through rising fuel costs to shippers, higher fuel surcharges make base rate increases less palatable to shippers. Read more
CEO Judy McReynolds took the helm in early 2010, following Robert Davidson's retirement. Davidson was with the firm for more than 35 years. McReynolds originally joined Arkansas Best in 1997 and served as CFO from 2006 through 2009. Michael Newcity Read more
Arkansas Best is one of the largest less-than-truckload carriers in the United States, with 277 service centers, 3,700 trucks, and 20,000 trailers at the end of 2012. Roughly Read more
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