INDUSTRY PULSE: No improvement in operating ratio for top carriers as costs rise as fast as revenues

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OTTAWA, Ont. — The nations top 91 for-hire motor carriers saw their revenues rise by 5.7% in the second quarter compared to the same period the previous year. Unfortunately, their expenses also rose by the same percentage, according to data released today by Statistics Canada.

As a result, the top for-hire carriers’ operating ratio (operating expenses divided by operating revenue) remained at 0.94, similar to the second quarter of 2005. A ratio greater than 1.00 represents an operating loss. Arguably, a ratio of 0.95 or better is considered healthy for the trucking industry, although many industries operate at more profitable average margins.

The countrys largest trucking companies (Canadian-based trucking companies earning $25 million or more annually) generated operating revenue of $2.4 billion and expenses of $2.2 billion in the second quarter. Average per-carrier revenues were $26.3 million and expenses $24.6 million.

The second quarter of 2006 data on the top for-hire carriers, taken from the Quarterly Motor Carriers of Freight Survey, provide results from 64 general freight carriers and 27 specialized freight carriers.

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