According to the company’s website press release on April 17, 2023, J.B. Hunt Transport Services, Inc. (NASDAQ: JBHT) announced first quarter 2023 U.S. GAAP (United States Generally Accepted Accounting Principles) net earnings of $197.8 million, or diluted earnings per share of $1.89 versus first quarter 2022 net earnings of $243.3 million, or $2.29 per diluted share.
Total operating revenue for the current quarter was $3.23 billion compared with $3.49 billion for the first quarter 2022, a decrease of 7%. The decline in revenue was primarily driven by declines in volume of 25% in Integrated Capacity SolutionsTM (ICS), 5% in Intermodal (JBI) and 17% in Final Mile Services® (FMS); and a 17% decline in revenue per load in Truckload (JBT). Revenue declines in ICS, JBI, FMS and JBT were partially offset by Dedicated Contract Services® (DCS®) revenue growth of 13%, primarily driven by a 7% increase in average revenue producing trucks. Current quarter total operating revenue, excluding fuel surcharge revenue, decreased approximately 10% versus the first quarter 2022.
Total freight transactions in the Marketplace for J.B. Hunt 360°® decreased 38% to $370 million in the first quarter 2023 compared to $600 million in the prior year quarter. ICS revenue on the platform decreased 42% to $251 million versus a year ago. JBT and JBI executed $88 million and $32 million, a decrease of 24% and 41%, respectively, of their third-party dray, independent contractor and power-only capacity through the platform during the quarter.
Operating income for the current quarter decreased 17% to $277.5 million versus $334.3 million for the first quarter 2022. Operating income decreased from first quarter 2022 primarily due to lower volumes and pressure on customer rate and cost recovery efforts across ICS, JBI and JBT. On a consolidated basis, increases in professional driver and non-driver wages, insurance-related costs, and equipment-related and maintenance expenses contributed to the year-over-year decline in operating income. In addition, first quarter 2023 included a $6 million net loss from the sale of equipment compared to a $17 million net gain in the prior year quarter. These items were partially offset by decreases in rail and truck purchased transportation costs largely stemming from lower freight activity and decreased usage of third-party capacity.
Net interest expense for the current quarter increased approximately 18% from first quarter 2022 due to higher effective interest rates, partially offset by a slightly lower consolidated debt balance.
The effective income tax rate increased to 24.7% in the current quarter compared to 24.4% in the first quarter 2022. We continue to expect our 2023 annual tax rate to be between 24.0% and 25.0%.
