P.A.M. Transportation Services Inc. reported net income of $3.2 million for the fourth quarter of 2015, finishing what Chief Executive Officer Dan Cushman described as a record-setting year for the Tontitown-based company.
Earnings per share grew 67 percent to 45 cents in the fourth quarter, while revenue of $102.4 million was an improvement from $101.7 million in 2014. P.A.M.'s fourth-quarter net income was up 51.6 percent from the year-ago quarter's $2.1 million, although the three-month period in 2014 included an additional $2.5 million in earnings set aside as a potential settlement payment for a lawsuit.
The fourth-quarter results helped P.A.M. increase its 2015 net income to $21.4 million and post earnings per share of $2.93, resulting in the company's most profitable year. Cushman said the previous best was in 2006. P.A.M. reported $13.5 million in net income and earnings per share of $1.68 in 2014.
"What made 2015 especially satisfying was that we set a new record with significantly fewer assets," Cushman said in a news release. "We did it by focusing on doing everything better."
Cushman said the company's growth was mainly achieved through internal efforts. He said P.A.M. did explore "multiple opportunities" for acquisitions during the year.
Bob Williams, senior vice president and managing director of Simmons First Investment Group in Little Rock, said the company's growth without acquisitions was "particularly impressive."
"Clearly, they've expressed interest in growing by whatever means they can," Williams said.
Cushman said P.A.M. was successful by stabilizing its expedited and dedicated businesses throughout the year. It also continued to enjoy strong demand in the automotive, Mexico and logistics divisions.
The logistics division, in particular, continued to expand with $10.6 million in revenue in the fourth quarter and $44.2 million for the full year. P.A.M. reported $7.1 million in logistics revenue for the fourth quarter of 2014 and $23.9 million for the full year, leaving Cushman to say the segment "far exceeded our expectations."
Williams believes it could continue in 2016.
"I think it has good potential," Williams said. "It's expensive to grow out that logistics business. But they'll be able to recoup the capital expenditures very quickly and make some good money."
P.A.M.'s truckload operations moved 76,650 loads during the fourth quarter, an increase from 69,651 loads a year ago. Weekly revenue per truck also increased in the fourth quarter from $3,220 to $3,345.
The average number of trucks operated by company drivers was 1,405 in the fourth quarter, down from 1,437 in the fourth quarter of 2014 as the company relied on more owner-operators. The owner-operator truck count increased from an average of 333 a year ago to 470 in the fourth quarter of 2015.
Cushman said that during the second quarter of 2015 the company was concentrating on becoming more "driver friendly" in its efforts to lower turnover trends. Investments and efforts helped the company's fleet add more than 100 drivers during the fourth quarter of 2015.
Cushman also said the company will continue to emphasize its commitment to drivers in a number of ways, highlighting a fleet of trucks with an average age of 1.3 years. Cushman said P.A.M. made "significant investments" in new trailers in 2015 as well and expects to do so again throughout 2016.
"While 2015 represented a record year for the company in many categories, we expect that the coming year won't be without its challenges," Cushman said. "However, we also believe that we have a diverse marketing plan that will allow us to adapt to various conditions and we look forward to the coming year."
P.A.M. shares ended trading Tuesday at $25.31, down 35 cents.
Business on 02/10/2016