06:53 AM EDT, 07/17/2024 (MT Newswires) -- J.B. Hunt Transport Services (JBHT) shares were down early Wednesday after the transportation and logistics company's second-quarter results missed estimates amid a decline in volumes across key business segments.

Net earnings dropped to $1.32 per share for the three-month period ending June 30 from $1.81 last year, the company said late Tuesday. Analysts surveyed by Capital IQ were looking for EPS of $1.51. Revenue decreased 7% to $2.93 billion, missing the Street's view for $3.03 billion. The stock slipped 3.1% in premarket activity.

The company attributed the decline in revenue mainly to a 5% fall in gross revenue per load in its intermodal segment. The result was also impacted by a decline in load volume of 25% in the integrated capacity solutions division and decreases of 9% each in the truckload and dedicated contract services businesses.

"While we have seen improvements across many of our cost categories, the lower revenue continued to put pressure on our margins across our business segments, with the exception of (final mile services) and (truckload), which improved operating margins year-over-year," Chief Financial Officer John Kuhlow said during an earnings call, according to a Capital IQ transcript. "We continue to focus our cost efforts in areas that would not prohibit our ability to support our future growth or our future earnings power."

Sales in the intermodal division moved 5% lower to $1.41 billion, reflecting declines in volume and gross revenue per load amid a soft freight market. Dedicated contract services revenue was down 4% to $851 million amid a 1% and 3% decline in average trucks and productivity, respectively.

In the integrated capacity solutions unit, revenue slumped 21% to $270.4 million as volume fell 25% year over year. Truckload sales declined 12% to $168.1 million, while the final mile services segment gained 5% buoyed by the implementation of multiple new contracts over the past year.

Operating income fell 24% to $205.7 million, impacted by lower revenue, equipment-related expenses, higher insurance and claims, among other factors, the company said. Operating expenses narrowed to $2.72 billion from $2.86 billion in the prior-year quarter.

J.B. Hunt now expects net capital expenditures for 2024 in the range of $650 million to $700 million, compared with its previous forecast of $800 million to $1 billion, Kuhlow said on the call. "This reduced plan largely reflects a moderation of both tractor and trailing fleet additions in addition to real estate projects," the CFO added.

"As we look at the overall freight market, we still see oversupply across all modes with shippers having options on both mode and provider to move their freight," Spencer Frazier, vice president of sales and marketing, told analysts. "While capacity is not a top concern right now, there is an awareness that this will change at some point, but the timing of which though remains unclear."

Price: 171.51, Change: -4.49, Percent Change: -2.55