Profits at Marten Transport, the first gateway for freight carriers, showed some signs of market weakness, reflected in increased capacity and falling rates, but they weren’t flashing red.

Some operating comparisons to the third quarter of 2021 were flat to weaker by segment. There was also some sequential data from the second quarter showing lower numbers, although in a seasonal business like trucking, sequential numbers have their drawbacks.

For the bottom line at Marten (NASDAQ: MRTN ), net income of 32 cents per share was 1 cent short of the Wall Street consensus, according to SeekingAlpha. But earnings per share were 6 cents better than in the third quarter of 2021.

Post-earnings trading on Marten shares was negative. Its shares were down 2.75% from Monday’s close of $20 at about 6:30 p.m. Over the past 52 weeks, Marten stock has been one of the truck’s best performers, rising 28.3% over that time.

Operating income of $324.45 million was about $4.5 million more than the forecast. Sequentially, revenue was down about $5 million compared to the second quarter of this year.

For the company as a whole, year-over-year revenue growth excluding fuel remained strong at 21.8%. But it was the smallest profit for the quarter this year. The comparison in the second quarter of 2022 with 2021 was 32.1%.

The increase in operating income from the third quarter of 2022 was also significant at 18.5%, but well below the 43.5% and 49.4% increases in the second and first quarters, respectively.

The growth of total revenue, including fuel, was 29.1%. Meanwhile, total costs, including fuel, rose more than 30% year over year to $290.7 million from $222.8 million. Fuel costs rose to $57.3 million from $33.9 million.

The only segment of the company that significantly improved its operating ratio compared to last year’s third quarter was the Dedicated division. Allocated OR net fuel improved to 84.9% from 87.6% a year ago. Its operating income rose to $13 million from $8.5 million on an increase in revenue of about $17.35 million, meaning a large percentage of the revenue increase came from the bottom line.

The OR truck load factor, excluding fuel, rose 100 basis points to 86.5%. Intermodal’s OR worsened to 97.6% from 89.4% as operating income fell to just $778,000 from $2.84 million a year ago. The brokerage company’s margin weakened to 893% from 87.2%.

In the third quarter of 2022, the consolidated OR excluding fuel, which includes truck, specialty, broker and intermodal, was 87.5%, down slightly from 87.1% a year ago. It lagged behind the indicator of the second quarter by 84.8%.

One area that showed a decline compared to the second quarter was average revenue excluding fuel per tractor per week. While the figure of $4,889 for the third quarter was significantly higher than the $4,411 figure for the corresponding quarter last year, it showed a small but noticeable decline from the $5,080 recorded in the second quarter of this year.

Dedicated revenue excluding fuel per tractor week, less exposed to spot market fluctuations, also recorded a sequential drop to $4,006 from $4,072. However, the Q3 2022 figure was significantly higher than the 2021 figure of $3,438.

Marten has done a good job of attracting new drivers. In prepared remarks for the earnings report — Marten does not speak to analysts — Executive Chairman Randolph Marten said the number of drivers at Marten grew by 199 in the quarter.

“This growth provides momentum for the quarters ahead, as we started an industry-leading 199 more drivers in the fourth quarter of this year than at the start of the third quarter, and have now increased our driver head count by 621, or 22.6%, since June 30, 2021 year”.

The 30% increase in expenses included wages and benefits, which rose to just under $100 million from $81 million a year ago. It was also up about $4.5 million from the second quarter.

Purchased shipments, which tend to rise in strong markets, fell sequentially to $64.4 million from $67.5 million. However, this was significantly higher than the $45 million posted in the third quarter of last year.

In addition to the increase in wages, purchased transportation and fuel, consumables and maintenance jumped to $14.9 million from $11.7 million last year, insurance rose to $11.9 million from $10.5 million, and the category of “other” expenses grew to $10.2 million from $7.1 million.

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