Spring
Business Update
Contributed by: Eric Vander Pol, Co-President
Spring is in the air. I don’t know about you, but Spring to me just beams with optimism and excitement. So many things that warm my heart are either happening, or just about to get started. The weather (for us up north) is improving and days are getting longer, freight volumes are approaching peak season, and in general this improves people’s attitudes. And most significantly, we just got to celebrate Easter and the Hope that it brings through Christ’s sacrifice on the cross. What a blessing! I hope you and your family found time to celebrate.
Quarter One Results
As a company we just finished up Q1 for 2026 strong. Kicking off this year, we as a company set one major goal for ourselves:
Improve our company Operating Ratio without jeopardizing service or safety.
After seeing three consecutive years of deterioration in this metric, getting the boat turned around and going in the right direction was pivotal in 2026. This backward movement was large in part due to significant inflation in some of our high cost buckets, combined with a three year market softening in the LTL space. So not exactly due to company performance, but either way getting financially healthier is paramount. I have said this in many meetings and will continue to say it till my time at OHFL is complete, profitability for privately held family businesses ensures our longevity. And that benefits all of us.
Operating Ratio
Given this primary goal for Oak Harbor, I am happy to report the operating results for the first quarter. As a company we finished with an OR of 95.69% compared to 96.72% for the prior year. A full one-point improvement on the OR through Q1 is a great sign.
Operating Ratio
95.69
-1.03%
from last year
96.72%
last year
We achieved these results for a variety of reasons:
Labor Costs
Managing our labor costs in accordance with freight volumes and revenue levels. During late Q3 of last year we really started seeing freight volumes soften up and we as a company had to respond accordingly.
Q4 was also soft last year but we are starting to see some improvement in tonnage. With that slight uptick in business, and our proper staffing levels, we improved our Labor % of Revenue by 0.63% year-over-year (YOY).
Bill Count & Revenue
Slight increases in bill count and revenue. For the quarter, the company posted a 2% increase on bill count and 3% on Total Revenue. By comparison in Q4 of last year, the company was down 2% on bill count. This is a good sight to see.
Nearly all this growth is coming from the southern states we operate in (CA, NV, AZ mainly) while we are actually still sliding a touch in the Pacific Northwest (PNW). Adding bill count in the PNW is the top goal for the Sales team right now.
Maintenance & Equipment Costs
Managing our Maintenance and Equipment costs. Midway through last year we put a heavy focus on fixing more of our equipment with our own people and reducing our outsourcing of work to vendors and other high-priced solutions. We were successful in our hiring efforts, and it has proven cost effective. Our vehicle maintenance cost bucket came in with a 0.41% reduction as a percentage of revenue.
Great job Shop Teams!
Claims
Lastly, our claims ratio is down to 0.40% compared to 0.70% the prior year. This is a phenomenal achievement and a metric we should be proud of as an operations team and boast about as a sales team. Coming from someone who spends much of my time on the sales component of our business, there is nothing a Customer hates more than damaged freight. Handling things properly, securing them when necessary and delivering in the same condition we picked up goes a long way for Customer goodwill. Thanks to the entire team for your efforts along these lines!
Rest of 2026
Looking out into Q2 and the rest of 2026 there are a lot of reasons for optimism. We are well positioned in our industry as the premier west coast LTL provider. The demand for our services is growing. The key for our continued success is the same as it has been for many years: take care of the Customer.
We do that and we will take advantage of an improved economic climate and achieve our goals in 2026 and beyond.
