Covenant Transportation Group, Inc. (Nasdaq:CVTI) today updated its outlook for the fourth quarter of 2014.
The company has experienced improvements in its operating results for the month of October 2014, which are expected to continue during the fourth quarter of 2014. For the fourth quarter to date, the company is experiencing the following:
- Demand is trending solidly above demand in the fourth quarter of 2013. For the month of October 2014, total revenue increased 10.9 percent, average freight revenue per total mile increased 10.6 percent, average miles per tractor per week increased nine percent and average freight revenue per tractor per week increased 20.5 percent, in each case compared with October 2013. For the first 12 days of November, average freight revenue per tractor per week increased approximately 16 percent on a preliminary basis and before month-end adjustments.
- Average seated truck count has increased sequentially by approximately 35 trucks for October 2014 compared with our average seated truck count for third quarter of 2014. The average number of tractors in the fleet was 2,607 in October 2014 versus 2,748 in October 2013.
- Fuel prices have been declining during the quarter. However, approximately 27 percent of the company's expected fuel usage for the fourth quarter is hedged at prices higher than the average fuel prices paid by the company for the fourth quarter to date. Accordingly, lower fuel prices are expected to have a limited impact on the company.
Officials said, "As a result of the trends mentioned above, we expect earnings per diluted share for the fourth quarter of 2014 to be materially greater than earnings per diluted share for the fourth quarter of 2013."