USA Truck 1Q loss narrows on cost cuts

USA Truck Inc. on Thursday reported a slimmer first-quarter loss than a year earlier, as aggressive cost cuts partially offset a steep decline in revenue from fuel surcharges and deteriorating demand.

The company posted a loss of $1.9 million, or 18 cents per share, compared with $2 million, or 19 cents per share, in the first-quarter of 2008.

Revenue sank 27 percent to $93.5 million, from $127.2 million a year earlier. Revenue last year included more than $30 million in fuel surcharges. USA Truck collected $10.7 million from fuel surcharges in the first three months of this year.

Analysts polled by Thomson Reuters expected the company to post a loss of 8 cents per share, with sales of $100.9 million.

USA Truck said it slashed 20 percent of its non-driver workforce, scaled back its fleet and money spent on insurance claims through safety initiatives to preserve cash. It also improved the efficiency of its remaining trucks to cut costs.

"This quarter presented the most challenging operating environment that we have ever experienced. The quarter was characterized by a severe contraction in freight volume resulting from the current economic recession and from inventory reductions by both manufacturers and retailers," the company said in a statement. "Although volumes have stabilized since January, albeit at historically low levels, the truckload industry continues to be plagued by too many trucks chasing too little freight, which is spawning fierce, and often irrational, price competition."

USA Truck believes that freight shipping demand will remain near "historic lows" in the near future, which will continue to hurt earnings.

The trucking company said it will continue to manage its costs to weather the economic recession.

Shares rose 23 cents to $13.37 in midday trading.