Arkansas Best Q3 2007 Earnings Call Transcript

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2007-10-26 13:16:54.0

Tags: Arkansas Best Corp.

Question-and-Answer Session

Operator

(Operator Instructions). Your first question comes from Justin Yagerman with Wachovia.

Justin Yagerman - Wachovia Securities

Hey, Good Morning guys and Judy.

Judy R. McReynolds

Good morning

Robert A. Davidson

Hello again Justin.

Justin Yagerman - Wachovia Securities

Hi, wanted to get its sense. With talking on more of the spot truckload freight how does fuel surcharge work on that. Did that go on to a regular LTL fuel surcharge system or are you taking that on from brokers where you maybe be getting dinged a little bit on the fuel side?

Robert A. Davidson

No, we do almost no business with brokers. The spot volume business is subject to our normal fuel surcharge at lower weights and at large weights there's a larger fuel surcharge which is competitive with the truck load carriers. Obviously, when we book that business we’re quoting a rate including the fuel surcharge and we try to be competitive when the market plays, so you can say that the bottom-line price is competitive and that probably influences what the fuel surcharge number is but it's on there end we're accessing it.

Justin Yagerman - Wachovia Securities

Okay so on higher weights, to just get it to right its more like a LTL fuel surcharge on the lower weights, it's pretty comparable to what you are getting on typical LTL shipments.

Robert A. Davidson

Justin, if you look at the nominal schedule above a certain size the fuel surcharge percentage actually doubles.

Justin Yagerman - Wachovia Securities

Got it. Okay and just I guess I don’t know if you mentioned this I didn’t catch it. What was your weight per shipment up year-over-year in the quarter or down?

Judy R. McReynolds

It was up 1.2%

Justin Yagerman - Wachovia Securities

Okay, can you talk about the mix and how it's changed I guess now in the quarter between truckload and LTL, how much more truckload freight are you picking up was your tonnage actually up in that year-over-year?

Robert A. Davidson

Well, that would depend upon what definition you have for truckload and LTL. I think it's just fair to say that we had more of the larger spot volume shipments than we did in the third quarter of last year, but pretty consistent what you saw on our second quarter of this year.

Justin Yagerman - Wachovia Securities

Okay, then looking at the RPM rollout. I know you guys obviously saw some OR degradation from that, do you expect that to improve as you start to lap the rollout. But can you talk a little bit about what are you seeing in that market and what the progress is and the brand recognition is starting to feel like out there?

 

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