Werner Enterprises said Thursday that its third-quarter profit fell 15 percent, with tighter safety regulations cutting into the average number of miles driven per truck.
It was the fifth consecutive quarterly decline in net income after 10 quarters of profit growth, and it came despite lower comparable diesel fuel costs and higher freight demand.
Werner said the number of comparable average monthly miles per truck fell 3.5 percent, in part because of new federal safety rules that took effect July 1. The rules mandate 30-minute driver rest periods after eight hours, among other changes related to hours of service. Werner said it is working with customers and drivers to minimize the impact of the changes and to raise rates.
Driver recruitment and retention also challenged the Sarpy County transportation and logistics firm as it competed with the construction and energy industries for a smaller pool of driving school graduates.
Werner's capital expenditures rose to $71.9 million for the quarter from $58 million last year, as the firm invested in new trucks and efficiency measures including aerodynamic features, idle reduction systems, tire inflation systems and trailer skirts.
Werner's net income fell to $21.3 million, or 29 cents per share, from $25.1 million, or 34 cents per share, a year ago. Revenue was up 1 percent at $512 million.
The company's value-added services, including brokerage, freight management and international logistics operations, were a positive, earning a 4.3percent operating income margin on revenue of $96.5 million, which was up 16 percent over last year.
“We continue to diversify our business model,” the firm said.