Pacer makes profit after three quarterly losses

Logistics provider Pacer International posted a fourth-quarter profit, helped by lower costs, reported Reuters.

Pacer said it expects gross margins for this year in the 19 percent range and sees an operating income compared with a loss in 2009.

It expects overall intermodal volume to be down 20 percent for the year primarily due to expected reductions in its wholesale transcontinental big box business.

The reductions are part of new arrangements with railroad partner Union Pacific that calls for Pacer's exit from wholesale intermodal business.

Pacer will be reducing the use of Burlington Northern Santa Fe routes due to the new arrangements with Union Pacific.

The company, which has been hit hard due to a weak freight market, said employment was down 559 from year-ago levels. It has suspended its dividend, reduced wage levels and consolidated offices in an effort to reduce costs.

Pacer posted three consecutive quarters of losses before returning to profitability in the fourth quarter of 2009. Its net income was US$10 million, compared with a loss of $64 million a year ago. Revenue fell 18 percent to $420.2 million.
 
 (source: Cargo News Asia)