Operating income decreased 48% over the same period 2012 primarily due to a decline in our gross profit margin and increased personnel cost. Gross profit margin decreased to 10.4% in the current quarter vs. 12.8% last year, primarily due to higher rates paid to qualified third party carriers. Personnel costs increased from the comparable period a year ago as we continue to on-board and train staff in order to expand our branch network over the next two years. Total branches at the end of the quarter grew to 22. ICS’s carrier base increased 8% and the employee count increased 14.5% vs. third quarter 2012.
- Third Quarter 2013 Segment Revenue: $97 million; down 17%
- Third Quarter 2013 Operating Income: $0.6 million; down 84%
JBT revenue for the current quarter decreased 17% from the same period in 2012, primarily from an 18% reduction in fleet size and lower utilization per truck. Rates per mile, excluding fuel surcharge decreased 0.4% on a 6% shorter length of haul. The slightly positive rate impact from spot business was more than offset by a 1.7% decrease in rates from consistent shippers. At the end of the period, JBT operated 1,951 tractors compared to 2,381 a year ago.
Operating income decreased by 84% compared to third quarter 2012. Favorable changes from lowering the size of the trailer fleet, fewer empty miles and reductions in office headcount were more than offset by lower tractor utilization from both moderate customer demand and new hours of service regulations, increased driver hiring costs, increased driver and independent contractor mileage pay and higher maintenance cost per unit.
Cash Flow and Capitalization:
At September 30, 2013, we had a total of $687 million outstanding on various debt instruments compared to $645 million at September 30, 2012 and $685 million at December 31, 2012.