(FORT SMITH, Arkansas, January 26, 2004) — Arkansas Best Corporation (Nasdaq: ABFS) today announced fourth quarter 2003 net income of $14.7 million, or $0.58 per diluted common share, compared to fourth quarter 2002 net income of $14.5 million, or $0.57 per diluted common share. Excluding a net earnings impact of $0.03 per diluted common share associated with the sale of Clipper Exxpress’s LTL customer and vendor lists and Clipper’s subsequent exit from the LTL business, fourth quarter 2003 earnings were $0.55 per diluted common share. Arkansas Best’s revenue during the fourth quarter of 2003 was $387.1 million, an increase of 1.5% over the fourth quarter of 2002.

“Arkansas Best had another solid performance in 2003, highlighted by a 13.2% After-Tax Return on Capital Employed. Arkansas Best ended 2003 with no outstanding debt on its revolving credit facility,” said Robert A. Young III, Arkansas Best President and Chief Executive Officer. “In spite of minimal increases in yearly LTL tonnage levels, ABF^Ò improved its full year 2003 operating ratio to 94.3% with a revenue increase of 7.3%. Though tonnage declined in the fourth quarter from the previous year, it was actually stronger than we anticipated based on typical sequential trends. Arkansas Best’s balance sheet strength combined with ABF’s continued strong operational performance, as illustrated by a fourth quarter 2003 operating ratio of 93.5%, puts our company in a good position to take advantage of a promising economic outlook and other opportunities that exist within the trucking industry.”

Arkansas Best’s superior financial performance was recognized, for the fourth year in a row, by Forbes magazine. In its January 12, 2004 issue, Arkansas Best once again was named as one of The Platinum 400 Best Big Companies in America. Based on Forbes’ calculation formula, Arkansas Best’s 5-year annualized total return of 39.5% was the #1 return in the “Transportation” industry sector and the 22^nd highest return of all “400 Best Big Companies” recognized.

ABF Freight System, Inc.^®

ABF Freight System, the company’s largest subsidiary, had revenues of $348.4 million during the fourth quarter of 2003, a per-day increase of 1.0% compared to fourth quarter 2002 revenue of $344.9 million. ABF’s operating income during the current quarter was $22.8 million compared to $27.1 million in the same period last year. ABF’s fourth quarter 2003 operating ratio was 93.5%, compared to an operating ratio of 92.2% during the fourth quarter of 2002.

Fourth quarter billed LTL revenue per hundredweight, including fuel surcharge, was $23.89, an increase of 2.7% over the fourth quarter 2002 figure of $23.27. Billed LTL revenue per hundredweight, excluding fuel surcharge, was $23.07, an increase of 2.3% over last year’s fourth quarter figure of $22.56. “The pricing environment is competitive but ABF continues to price rationally and manage effectively during this period of slight business improvement,” said Mr. Young.

Fourth quarter 2003 LTL tonnage per day decreased 2.3% when compared to the 2002 fourth quarter. “Since September, the one-year anniversary of the closure of Consolidated Freightways, monthly LTL tonnages have declined when compared to the same month of 2002. However, compared to the September monthly year-over-year tonnage changes, declines were less severe during the fourth quarter. For instance, September 2003’s year-over-year LTL tonnage decline of 5.4% compares to declines of 2.0% in October 2003, 3.1% in November 2003 and 1.3% in December,” said Mr. Young. “In addition, considering sequential, historical trends versus September, fourth quarter 2003 LTL tonnage is running approximately 2% better than expected. These business changes are very encouraging and suggest that the improving U.S. economy is benefiting the general freight market.”

Fourth quarter 2003 truckload tonnage per day increased by 7.0% versus the fourth quarter of 2002. “Because of tightening capacity in the truckload industry, ABF was able to obtain a greater number of these larger shipments,” said Mr. Young. 

“Productivity measures at ABF were below those of the fourth quarter of 2002. As seen in the third quarter, additional shipment handling related to ABF’s concentration on transit time improvements and premium services provided at pickup and delivery adversely affected these measures,” said Mr. Young. 

ABF’s fourth quarter 2003 operating ratio was greater than the operating ratio of the fourth quarter of 2002 for several reasons. The decline in quarterly business levels negatively impacted ABF’s profitability, as some fixed costs remained in the system in spite of tonnage reductions. As discussed earlier, declines in productivity contributed to higher labor and fringe costs. Depreciation expenses rose by approximately $1.3 million because of increased depreciation on some road tractors and road trailers to reflect reductions in expected salvage values based on current market conditions.

ABF’s quarterly purchased transportation costs increased over the fourth quarter of 2002 because of additional business in ABF’s traditional West Coast rail lanes. This required ABF to use a greater amount of rail to transport this freight and to minimize the movement of empty ABF equipment across the country.     

For the full year of 2003, ABF’s revenue was $1.37 billion, an increase of 7.3% over 2002 revenue. ABF’s 2003 operating ratio was 94.3% versus 94.6% in 2002. ABF’s 2003 operating income was $77.8 million versus $68.8 million during 2002. Total tonnage per day in 2003 was approximately equal to that of 2002. LTL tonnage per day during 2003 increased 0.7% over 2002 levels and truckload tonnage per day decreased 2.6% versus 2002. Billed LTL revenue per hundredweight, excluding fuel surcharge, was $22.99, an increase of 4.9% over last year’s full year figure of $21.91.

New Federal Hours of Service Regulations

Much has been written and discussed about the new federal Hours of Service regulations that went into effect on January 4, 2004. The new rule changes are designed to improve highway safety by reducing fatigue, thus saving lives and preventing accidents. Due to its long-standing commitment to safety, ABF has supported these changes, which are generally reasonable and logical. The operational impact on ABF’s over-the-road, linehaul relay network will be modest, although we anticipate a small decline in driver and equipment utilization offset by the opportunity to further improve transit times. The truckload industry anticipates significantly higher costs associated with driver pay, customer delays and increased charges for stop-off and detention services. As a result, ABF believes that opportunities will exist to handle some larger shipments that have recently been moving by truckload carriers.

Recognition of Excellence at ABF

During November, ABF was once again recognized for achievements in the areas of technology. ABF earned two awards in InfoWorld magazine’s annual listing of the top 100 enterprise projects using information technology to creatively achieve business goals. These awards were associated with ABF’s Web site and its NetLink system, a system that uses wireless technology to streamline procedures across ABF’s network. “ABF continues to provide value through improvements in the level of information and shipment visibility available to its customers. ABF’s Web site has been a significant factor in those improvements,” said Mr. Young. “The real-time information available through the NetLink system greatly enhances the customized services ABF offers its customers and allows our employees to work more economically and effectively.”

Also in November, ABF was named by Selling Power magazine as one of the top seven companies to sell for in the service sector of the United States economy. This is the second consecutive year ABF has been recognized with this honor, placing among the top 10 in both years. “The comprehensive training and professional development of ABF’s sales force are essential elements associated with this award,” said Mr. Young. “Providing the necessary tools to people who listen and react to the needs of customers will continue to be a key to ABF’s success.”

ABF Business Trends and Items of Note

This information describes certain aspects of ABF’s historical operating performance characteristics and is not intended to be a projection or prediction.

Because of changes that have occurred in the LTL industry since the closure of Consolidated Freightways in September 2002, sequential comparisons of business levels are often more revealing than year-over-year comparisons. An analysis of the 1998 through 2002 sequential relationship between fourth quarter LTL tonnage levels and subsequent first quarter LTL tonnage levels reveals a seasonal decline in ABF’s LTL tonnage per day. Applying this historical relationship to actual LTL tonnage-per-day figures for the fourth quarter of 2003 yields a first quarter 2004 LTL daily tonnage figure that is generally comparable to the LTL daily tonnage level of the first quarter of 2003. It is not known at this time if this historical level of change will, in fact, occur in the first quarter of 2004 relative to the first quarter of 2003. This sequential tonnage analysis is only a starting point for predicting upcoming business levels. The effects of various economic and industry factors must also be considered.

The first quarter generally has the highest operating ratio of the year. First quarter tonnage levels are normally lower during January and February while March provides a disproportionately higher amount of the quarter’s business. Adverse weather conditions in the early months of the first quarter can have a negative impact on productivity and costs. As the weather improves, business levels tend to increase and the operating results of March often have a significant impact on the first quarter’s results. These observations are made based ABF’s historical operating performance.

Conference Call

Arkansas Best Corporation will host a conference call with company executives to discuss the Company’s 2003 fourth quarter and full year results. The call will be today, Monday January 26, at 11:00 a.m. EST (10:00 a.m. CST). Interested parties are invited to listen by calling (877) 275-1257. Following the call, a recorded playback will be available through Friday, February 6. To listen to the playback, dial (800) 642-1687. The conference call ID for the playback is 4784588. The live conference call and playback can also be accessed, through Friday, February 6, on Arkansas Best’s Internet Web site at www.arkbest.com.

Company Description

Arkansas Best Corporation, headquartered in Fort Smith, Arkansas, is a diversified transportation holding company with two primary operating subsidiaries. ABF Freight System, Inc., in continuous service since 1923, provides national transportation of less-than-truckload (“LTL”) general commodities throughout North America. Clipper is an intermodal marketing company that provides domestic freight services utilizing rail and over-the-road transportation.

Forward-Looking Statements

The following is a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995: Statements contained in this press release that are not based on historical facts are “forward-looking statements.” Terms such as “estimate,” “expect,” “predict,” “plan,” “anticipate,” “believe,” “intend,” “should,” “would,” “scheduled,” and similar expressions and the negatives of such terms are intended to identify forward-looking statements. Such statements are by their nature subject to uncertainties and risk, including, but not limited to, union relations; availability and cost of capital; shifts in market demand; weather conditions; the performance and needs of industries served by Arkansas Best’s subsidiaries; actual future costs of operating expenses such as fuel and related taxes; self-insurance claims and employee wages and benefits; actual costs of continuing investments in technology; the timing and amount of capital expenditures; competitive initiatives and pricing pressures; general economic conditions; and other financial, operational and legal risks and uncertainties detailed from time to time in the Company’s SEC public filings

The following table shows financial data for ABF Freight System, Inc.

ABF FREIGHT SYSTEM, INC.