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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended March 31, 2005

- OR -

For the transition period from              to             

Commission file number 000 – 24573

Overnite Corporation

(Exact name of registrant as specified in its charter)

1000 Semmes Avenue, Richmond, Virginia

(Address of principal executive offices)

23224

(Zip Code)

(804) 231-8000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    YES x    NO ¨

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    YES x    NO ¨

As of May 1, 2005, there were 28,251,505 shares of the Registrant’s Common Stock outstanding.

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OVERNITE CORPORATION

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PART I. FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

OVERNITE CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited)

The accompanying Notes are an integral part of these Consolidated Condensed Financial Statements.

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OVERNITE CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL POSITION (Unaudited)

The accompanying Notes are an integral part of these Consolidated Condensed Financial Statements.

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OVERNITE CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)

The accompanying Notes are an integral part of these Consolidated Condensed Financial Statements.

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OVERNITE CORPORATION

NOTES TO THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(Unaudited)

Basis of Presentation

The accompanying unaudited consolidated condensed financial statements for Overnite Corporation and its subsidiaries (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial reporting, and in accordance with instructions to Form 10-Q and Article 10 of Regulation S-X promulgated by the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and notes required by generally accepted accounting principles for a complete financial presentation. In the opinion of management, the financial statements include all adjustments (consisting only of normal and recurring adjustments) necessary for a fair presentation of the financial position and operating results for the interim periods. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Annual Report on Form 10-K for Overnite Corporation for the year ended December 31, 2004. The results of operations for the three months ended March 31, 2005 are not necessarily indicative of the expected results for the entire year ending December 31, 2005.

Unless the context otherwise requires, all references herein to “we,” “us,” “our,” “Overnite” and “the Company” are to Overnite Corporation and its subsidiaries.

On November 5, 2003 Union Pacific Corporation (“UPC”) completed the divestiture of its entire interest in Overnite Holding, Inc. (“Overnite Holding”) through an initial public offering. This transaction is referred to as the “Divestiture Transaction.”

Note 1. Business

The Company, through its primary operating subsidiaries, is a leading predominantly non-union provider of less than truckload (“LTL”) transportation service, offering a full spectrum of regional, inter-regional and long-haul services nationwide. The Company serves a diverse customer base through a network of 208 service centers. The Company operates through two principal subsidiary companies, Overnite Transportation Company (“Overnite Transportation” or “OTC”) and Motor Cargo Industries, Inc. (“Motor Cargo”). OTC operates on a nationwide basis and Motor Cargo operates primarily in the Western United States.

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OVERNITE CORPORATION

NOTES TO THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS—(Continued)

(Unaudited)

Note 2. Earnings and Dividends Per Share

The following table presents information necessary to calculate basic and diluted earnings per share and common equivalent shares:

Basic earnings per share is calculated on the weighted average number of common shares outstanding during each period. Diluted earnings per share includes shares issuable upon exercise of outstanding stock options and stock-based awards where such instruments would be dilutive.

Note 3. Comprehensive Income

For the three months ended March 31, 2005 and March 31, 2004, the Company recognized total comprehensive income of $11.4 million and $7.5 million, respectively.

Note 4. Segment Information

OTC Segment

The OTC segment includes the LTL and closely related truckload operations of Overnite Transportation, operating as a regional carrier with long-haul capabilities, with a network of 171 service centers. This segment serves all 50 states, Canada, Puerto Rico, Guam, the U.S. Virgin Islands and Mexico and transports a variety of products, including machinery, textiles, plastics, electronics and paper products. The assets and expenses of Overnite Corporation are included in the OTC segment.

Motor Cargo Segment

Motor Cargo is a regional LTL carrier operating through 37 service centers, providing transportation services within the western United States and Canada, transporting a variety of products, including consumer goods, packaged foodstuffs, electronics, apparel, hardware and industrial goods. Motor Cargo also provides warehousing and logistics services.

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OVERNITE CORPORATION

NOTES TO THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS—(Continued)

(Unaudited)

The following tables reflect asset information for these segments of the Company at March 31, 2005 and December 31, 2004, and capital expenditures and depreciation expense for the three-month periods ended March 31, 2005 and 2004:

The following table reflects operating segment information of the Company for operating revenue, operating income and net income for the three-month periods ended March 31, 2005 and 2004:

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OVERNITE CORPORATION

NOTES TO THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS—(Continued)

(Unaudited)

Note 5. Long-term debt

On November 3, 2004 the Company amended and restated the Credit Agreement (the “Amended Credit Agreement”) to reduce the total credit availability to $250 million. The Company increased the revolving loan commitment to $250 million, of which $175 million can be used for the issuance of letters of credit, and converted all outstanding term loans to revolving loans so that the outstanding principal amount of all term loans and term loan commitments was reduced to zero.

Prior to amending the Credit Agreement Overnite Transportation had $300 million of available borrowing consisting of a term loan of $125 million and a revolving loan of $175 million, of which up to a maximum of $150 million was available for the issuance of letters of credit. The $125 million term loan was used to pay a portion of the cash dividend to Union Pacific in connection with the Divestiture Transaction. The remaining $3 million portion of the cash dividend was funded by the revolving loan facility. Borrowings under the term loan and the revolving loan bore interest, at the Company’s option, at either adjusted LIBOR or the alternate base rate, plus a spread based on our credit rating. The Credit Agreement contained covenants customary for financings of this type.

Long-term debt at March 31, 2005 consisted of $85.6 million outstanding under the Amended Credit Agreement. The remaining availability under the revolving loan facility can be used for working capital, capital expenditures, general corporate purposes and to support letters of credit. The terms of the Amended Credit Agreement also provide for an increase, at the Company’s option, in the aggregate commitments under the facility from $250 million to $400 million, either by adding additional lenders or by agreeing with existing lenders to increase their commitments. The revolving loan facility has a maturity date of November 3, 2009.

Borrowings under the revolving loan facility bear interest, at the Company’s option, at either adjusted LIBOR plus a margin, which is based upon our leverage ratio or the alternate base rate. The effective interest rate at March 31, 2005 was 3.47%. For the three months ended March 31, 2005 the average interest rate was 3.52%. Outstanding letters of credit issued under the revolving loan facility are subject to an annual fee equal to the applicable spread over adjusted LIBOR for revolving loans.

The Amended Credit Agreement contains affirmative, negative and financial covenants the Company believes are customary for financings of this type. Specifically, the Amended Credit Agreement contains financial covenants regarding maximum leverage ratios and a minimum fixed charge coverage ratio. Overnite Transportation is the borrower under the Amended Credit Agreement. Obligations under the Amended Credit Agreement are guaranteed by Overnite and certain of our domestic subsidiaries, including Motor Cargo, and are secured by a first-priority lien on and security interest in all of the capital stock of Overnite Holding, Overnite, Inc. and OTC, as well as all of the capital stock held by OTC and any guarantor under the Amended Credit Agreement. We maintained compliance with all of the covenants contained in the Amended Credit Agreement through March 31, 2005 on a quarterly basis, except for a minor technical default of a non-financial covenant. This matter was resolved with the lenders through a waiver and amendment to the Amended Credit Agreement.

The Company’s long-term debt at March 31, 2005 and December 31, 2004 consists of:

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OVERNITE CORPORATION

NOTES TO THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS—(Continued)

(Unaudited)

Note 6. Retirement Plans

The Company provides defined pension benefits to eligible employees of OTC and Motor Cargo. OTC pension benefits are based on years of service and compensation during employment and cover substantially all employees. Motor Cargo pension benefits are based solely upon years of service.

During the first three months of 2005, the Company made pension plan contributions of $30.0 million. There were no pension contributions in the comparable period of 2004.

The amount of net periodic benefit cost for the three months ended March 31, 2005 was $13.5 million compared to $9.1 million for the same period in 2004. The components are summarized in the table below:

Note 7. Stock-Based Compensation

The Company has stock-based employee compensation that consists of options, stock appreciation rights, stock awards or performance shares. The Company accounts for these plans under the recognition and measurement principles of APB Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations. No stock-based employee compensation expense related to stock option grants is reflected in net income as all options granted under these plans had an exercise price equal to the market value of the underlying common stock on the date of grant. Stock-based employee compensation expense related to restricted stock and other incentive plans is reflected in net income. The following table illustrates the effect on net income for the three-month periods ended March 31, 2005 and 2004 if the Company had applied the fair value recognition provisions of Financial Accounting Standards Board (the “FASB”) Statement No. 123, “Accounting for Stock-Based Compensation,” to stock-based employee compensation:

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OVERNITE CORPORATION

NOTES TO THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS—(Continued)

(Unaudited)

The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model. There were no grants during the three months ended March 31, 2005. Assumptions for the three months ended March 31, 2004 were: risk free interest rates of 3.0%; dividend yield of 0.7%; expected lives of 5 years; and volatility of 42.7%.

Note 8. Commitments and Contingencies

Unasserted Claims—There are various claims and lawsuits pending against the Company. It is not possible at this time for the Company to determine fully the effect of all unasserted claims on its consolidated financial condition, results of operations or liquidity; however, to the extent possible, where unasserted claims can be estimated and where such claims are considered probable, the Company has recorded a liability. The Company does not expect that any known lawsuits, claims, environmental costs, commitments, contingent liabilities or guarantees will have a material adverse effect on its consolidated financial condition, results of operations or liquidity.

Commitments—As of March 31, 2005, the Company’s self-insured retention arrangements for workers’ compensation and automobile liability were secured by $89.7 million in letters of credit, which were unused, compared to $83.4 million as of December 31, 2004. The Company has $88.3 million of the letters of credit at March 31, 2005 that fall under the Company’s accounts receivable securitization facility, with $11.7 million remaining available under such facility.

Goodwill—The Company completed the required goodwill impairment test under generally accepted accounting principles effective August 31, 2004, which did not indicate any impairment. The Company has $13.2 million of goodwill and $3.0 million in non-amortizable intangible assets related to its investment in Motor Cargo.

Note 9. Recent Accounting Pronouncements

In March 2005 the Financial Accounting Standards Board (FASB) promulgated FASB Interpretation No. 47, “Accounting for Conditional Asset Retirement Obligations,” (FIN 47). FIN 47 requires the Company to recognize a liability for the fair value of asset retirement obligations when the timing and/or method of settlement of the obligation are conditional on a future event. The Company analyzed this new requirement and believes it applies to the fee imposed by the various states upon the ultimate disposal of tractor and trailer tires. The Company has approximately 190,000 tires in use subject to the disposal fee.

While the effective date of FIN 47 is December 31, 2005, retrospective application and early adoption of the interpretation is permitted and encouraged. The Company determined to apply FIN 47 effective March 31, 2005. The effect of adopting the new accounting principle on net income, operating income, assets and liabilities is immaterial to the financial statements. The asset retirement cost is scheduled to be amortized over a seven-year period, which is the average life of tire casings.

In December 2004, the Financial Accounting Standards Board (“FASB”) issued Statement No. 123(R) (“FAS 123(R)”), Share-Based Payment. FAS 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. On April 14, 2005, the Securities and Exchange Commission (“SEC”) announced the adoption of an amendment to the required compliance dates for FAS 123(R). As a result, this statement will be effective for the Company on January 1, 2006.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD LOOKING STATEMENTS

The following discussion contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include information relating to future events, future financial performance, strategies, expectations, competitive environment, regulation and availability of resources. These forward-looking statements include, without limitation, statements regarding: expectations as to operational improvements; expectations as to cost savings, revenue growth and earnings; the time by which certain objectives will be achieved; estimates of costs relating to environmental remediation and restoration; proposed new products and services; expectations that claims, lawsuits, environmental costs, commitments, contingent liabilities, labor negotiations or agreements, or other matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results and future economic performance; and statements of management’s goals and objectives and other similar expressions concerning matters that are not historical facts. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements.

Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved. Forward-looking information is based on information available at the time and/or management’s good faith belief with respect to future events, and is subject to risks and uncertainties that could cause the Company’s actual performance or results to differ materially from those expressed in the statements. Important factors that could cause such differences include, but are not limited to: whether we are fully successful in implementing our financial and operational initiatives; industry competition; conditions, performance and consolidation; legislative and/or regulatory developments; the effects of adverse general economic conditions, both within the United States and globally; any adverse economic or operational repercussions from terrorist activities, any government response thereto and any future terrorist activities, war or other armed conflicts; changes in fuel prices; changes in labor costs; labor stoppages; the outcome of claims and litigation; natural events such as severe weather, floods and earthquakes and other factors described in the Company’s filings with the SEC, including under “Risk Factors” under Item 1 of our annual report on Form 10-K for the year ended December 31, 2004.

Forward-looking statements speak only as of the date the statements are made. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect thereto or with respect to other forward-looking statements.

OVERVIEW

The Company is a leading, predominantly non-union provider of LTL transportation services, offering a full spectrum of regional, inter-regional and long-haul LTL services nationwide. In addition to our core LTL service, we also provide our customers with a number of additional value-added LTL services, including expedited and guaranteed delivery, cross-border, assembly and distribution, trade show, government and third party logistics services. We also provide our customers with truckload and dedicated truckload transportation solutions. We serve a diverse customer base through a network of 208 service centers. We transport a variety of products, including fabricated metal products, health care products, chemicals, textiles, machinery, furniture and fixtures, electronics and paper products and general commodities, including consumer goods, packaged food stuffs, industrial equipment and auto parts.

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MANAGEMENT SUMMARY

Operating revenue for the three months ended March 31, 2005 was $418.0 million, an increase of $39.5 million or 10.4% from $378.5 million for the comparable period of 2004. Total operating expense for the three months ended March 31, 2005 was $397.6 million, an increase of $33.0 million or 9.1% from $364.6 million for the comparable period of 2004. The growth in operating revenue for the three months ended March 31, 2005 was primarily attributable to volume growth of 2.7%, higher fuel surcharges, and rate increases negotiated with customers. The tonnage growth was primarily attributable to economic growth. Higher expenses were primarily due to increased volumes and higher fuel costs.

Table 1 sets forth certain statement of income data expressed as a percentage of operating revenue.

RESULTS OF OPERATIONS

TABLE 1

Notes:

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Operating Revenue

Table 2 includes the components of operating revenue for the three months ended March 31, 2005 and 2004. Operating revenue is affected by weight hauled, LTL revenue per LTL hundredweight (LTL Rate Factor), and volume of shipments of our dedicated truckload service.

TABLE 2

For the three months ended March 31, 2005, operating revenue increased $39.5 million. A 2.1% increase in LTL weight hauled contributed to the increase in operating revenue. This volume increase was primarily the result of a stronger economy and contributed approximately $7.1 million in additional operating revenue. The LTL Rate Factor, including fuel surcharge (as shown in Table 2), increased 6.2%. This change, which increased operating revenue approximately $21.2 million, is the result of increased revenue from fuel surcharges and favorable price negotiation with customers. These increases were offset by changes in our freight mix, such as heavier weight per shipment. Our dedicated truckload revenue increased $6.4 million due to growth in shipments resulting from increased market share in new and existing markets. TL revenue increased $4.5 million as a result of a 5.5% increase in weight hauled and increased fuel surcharges. Fuel surcharge revenue, which is included in the preceding amounts referenced in this paragraph, was $30.4 million, an increase of $15.8 million, or 108.8%, over $14.6 million for the comparable period of 2004.

Overnite Transportation: Operating revenue for the three months ended March 31, 2004 was $372.8 million, an increase of $34.5 million or 10.2%, from $338.3 million for the comparable period in 2004. For the

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three months ended March 31, 2005, LTL volume increased 1.6%, contributing approximately $4.8 million in additional revenue. The LTL Rate Factor increased by 6.3%, increasing operating revenue by approximately $19.3 million. Dedicated truckload service contributed $6.4 million in additional operating revenue. Operating revenue from truckload services increased by $3.8 million. LTL weight per LTL shipment increased by 2.1%. Fuel surcharge revenue, which is included in the preceding amounts referenced in this paragraph, was $27.5 million, an increase of $14.5 million, or 110.9%, from $13.0 million for the comparable period in 2004.

Motor Cargo: For the three months ended March 31, 2005, operating revenue was $45.2 million, an increase of $5.0 million, or 12.4%, from $40.2 million in the comparable period of 2004. LTL operating revenue increased $4.1 million as LTL weight hauled increased 6.0%. Truckload services and other services contributed $0.9 million in additional operating revenue. Fuel surcharge revenue, which is included in the preceding amounts referenced in this paragraph, was $2.9 million, an increase of $1.4 million, or 90.3%, from $1.5 million for the comparable period in 2004.

Operating Expenses

For the three months ended March 31, 2005, operating expenses were $397.6 million, an increase of $33.0 million, or 9.1%, from $364.6 million for the comparable period in 2004. As a percentage of operating revenue, operating expenses improved to 95.1% of revenue for the three months ended March 31, 2005, compared to 96.3% for the comparable period of 2004.

For the three months ended March 31, 2005 operating expenses were primarily affected by changes in the following: salaries, wages and employee benefits, supplies and expenses and rents and purchased transportation, as shown in Table 3.

TABLE 3

Salaries, Wages and Employee Benefits:

Salaries, wages and employee benefits were 58.7% of operating revenue in the period, compared to 60.1% for the comparable period in 2004. This 1.4% improvement as a percent of operating revenue resulted from our increased volume of transportation services, while maintaining control over wage and benefit costs.

The 7.9% increase in salaries, wages and employee benefits from $227.3 million for the three months ended March 31, 2004 to $245.4 million for the three months ended March 31, 2005 was due, in part, to wage inflation and a 3.7% increase in the average number of employees over the comparable prior period. The increase in the number of employees was primarily due to the increase in volume shipped. Salaries and wages increased by $11.1 million for the reasons stated above.

Employee benefit expenses increased $7.0 million for the three months ended March 31, 2005 and was primarily affected by pension cost increases and the 3.7% increase in the average number of employees. Expenses related to pension and other post retirement benefits were $16.9 million for the three months ended March 31, 2005, an increase of $4.2 million, or 33.1%, from $12.7 million in the comparable period of 2004.

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This increase was primarily attributable to the lower than expected returns on pension assets in the years 2000 through 2002 and declines in interest rates. Payroll taxes were $20.8 million for the three months ended March 31, 2005 an increase of $2.0 million, or 11.0%, from $18.8 million for the comparable period of 2004. The cost of healthcare benefits for active employees was $19.9 million in the three months ended March 31, 2005, a decrease of $1.2 million, or 5.7%, from $21.1 million in the comparable period in 2004.

Supplies and Expenses:

Supplies and expenses increased to 10.6% of operating revenue in the three months ended March 31, 2005 from 8.6% in the comparable period of 2004. The increase in expense was primarily due to a 55.7% increase in fuel expense. Fuel expense was $27.7 million for the 2005 period compared to $17.8 million in 2004 and the increase is a result of a 4.6% increase in miles driven and a 47.6% increase in the cost of fuel compared to 2004. Maintenance and facilities supplies expenses were $16.7 million for the three months ended March 31, 2005, an increase of $2.0 million, or 13.6%, from $14.7 million in the comparable period in 2004. Maintenance and facilities supplies expenses increased as a result of increased volume and an associated 4.6% increase in miles driven during the three months ended March 31, 2005.

Rents and Purchased Transportation:

Rents and purchased transportation expenses decreased to 10.3% of operating revenue from 10.9% in 2004, while increasing by $1.9 million, or 4.6%, from the comparable period of 2004. The 2.7% increase in tonnage hauled and an increase in the rates charged by third-party carriers, primarily related to higher costs such as fuel and insurance, were the primary causes of the increase in rents and purchased transportation expenses.

Overnite Transportation: Operating expenses at OTC were $355.1 million for the three months ended March 31, 2005, an increase of $29.0 million, or 8.9%, from $326.1 million for the comparable period in 2004 due to the factors discussed above.

Motor Cargo: Operating expenses at Motor Cargo were $42.5 million for the three months ended March 31, 2005, an increase of $4.0 million, or 10.6%, from $38.5 million for the comparable period in 2004 due to the factors discussed above.

Operating Income

For the three months ended March 31, 2005, operating income was $20.3 million, an increase of $6.3 million, or 45.5%, compared to $14.0 million in the comparable period of 2004. Our operating expenses as a percentage of operating revenue, or operating ratio, was 95.1% for the three months ended March 31, 2005, compared to 96.3% for the comparable period of 2004.

Overnite Transportation: For the three months ended March 31, 2005, operating income at OTC was $17.6 million, an increase of $5.4 million, or 44.4%, from $12.2 million in the comparable period of 2004. For the three months ending March 31, 2005, the operating ratio for OTC improved to 95.3%, compared to 96.4% for the comparable period of 2004.

Motor Cargo: For the three months ended March 31, 2005, operating income at Motor Cargo was $2.7 million, a increase of 53.8% from $1.8 million in the comparable period of 2004. For the three months ended March 31, 2005, the operating ratio for Motor Cargo was 94.0%, compared to 95.6% for the comparable period of 2004.

Other Income and Expense Items

Other income and expense items netted to $1.3 million of expense for the three months ended March 31, 2005 and 2004. We reduced our debt by $10.0 million during the quarter. Interest expense for the three months ended March 31, 2005 was $1.4 million compared to $1.3 million for the comparable period of 2004.

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Income Taxes

Income taxes were $7.7 million in the three months ended March 31, 2005, with an effective tax rate of 40.2%, compared to $5.1 million in the comparable period of 2004, with an effective tax rate of 40.5%.

Net Income

As a result of the foregoing, net income for the three months ended March 31, 2005 was $11.4 million, an increase of $3.9 million, or 51.3%, from $7.5 million in the comparable period of 2004. OTC contributed $9.7 million in net income for the three months ended March 31, 2005, compared to $6.4 million in net income in the comparable period of 2004. Motor Cargo contributed $1.7 million of net income in the three months ended March 31, 2005 compared to $1.1 million in net income in the comparable period of 2004.

Liquidity and Capital Resources

Net cash provided by operating activities was $39.1 million during the first three months of 2005, an increase of $4.3 million, or 12.2%, from $34.8 million during the comparable period of 2004. Net cash from operations is attributable primarily to net income, adjusted for depreciation, changes in working capital items and pension plan contributions. During the three months ended March 31, 2005 we made $30.0 million of contributions to our pension plans and made no contributions in the comparable period of 2004. We plan to contribute $45 million to the pension plan in 2005.

Our business requires substantial ongoing capital investments, particularly for replacement of revenue equipment such as tractors and trailers. Capital expenditures totaled $4.8 million in the first three months of 2005 compared to $5.9 million for the comparable period of 2004, as set forth in Table 4:

TABLE 4

The $1.1 million decrease in capital expenditures between the first three months of 2005 and 2004 relates primarily to timing of the purchase of technology equipment and software.

Historically, our capital expenditures have been funded primarily through cash provided by operations and to a lesser extent by the proceeds from sales of used equipment and facilities. We generated cash proceeds from the sale of used tractors and trailers in the amount of $0.4 million in the first three months of 2005 compared to $0.6 million in the comparable period of 2004.

During the first three months of 2005 we paid dividends of $1.1 million to our shareholders and repaid $10.0 million of debt compared to dividends of $1.1 million and debt repayment of $3.1 million in the comparable period of 2004.

Based on our current level of operations and our anticipated growth, we believe that cash flow from operations and other available sources of liquidity, including borrowings under our bank credit facility, will be sufficient to fund our operations for the next 12 months and for our currently anticipated needs beyond that period.

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Contractual Obligations and Commercial Commitments

We have contractual obligations and commercial commitments that may affect our financial condition. Based on our assessment of the underlying provisions and circumstances of our material contractual obligations and commercial commitments there is no known trend, demand, commitment, event or uncertainty that we believe is reasonably likely to occur which would have a material adverse effect on our results of operations, financial condition or liquidity. In addition, our commercial obligations, financings and commitments are customary transactions which we believe are similar to those of other comparable corporations within the transportation industry.

Concurrent with the Divestiture Transaction, Overnite and OTC entered into a $300 million Credit Agreement with a syndicate of lenders. The Credit Agreement provided for aggregate commitments of $300 million, consisting of (1) a term loan facility of $125 million and (2) a revolving loan facility of $175 million, of which up to a maximum of $150 million was available for the issuance of letters of credit. Availability under the revolving loan facility was reduced by outstanding letters of credit issued under the facility. Each of the term loan and the revolving loan facility had a maturity of five years.

Borrowings under the term loan and revolving loan facility bore interest, at our option, at either adjusted LIBOR or the alternate base rate, plus a spread based upon our credit rating. Outstanding letters of credit issued under the revolving loan facility were subject to an annual fee equal to the applicable spread over adjusted LIBOR for revolving loans.

On November 3, 2004, the Company amended the Credit Agreement to reduce the total credit availability to $250 million by (i) increasing the revolving loan facility to $250 million, of which $175 million is available for the issuance of letters of credit, and (ii) converting all outstanding term loans to revolving loans so that the outstanding principal amount of all term loans and term loan commitments was zero. The interest rate at March 31, 2005 is 3.47%. The terms of the Credit Agreement, as amended and restated (the “Amended and Restated Credit Agreement”) also provide an option for the Company to increase the aggregate revolving credit commitments under the facility from $250 million up to $400 million, either by adding additional lenders or agreeing with existing lenders to increase their commitments. The revolving loan facility has a maturity date of November 3, 2009. The Amended and Restated Credit Agreement contains affirmative, negative and financial covenants customary for financings of this type. Specifically, the Amended and Restated Credit Agreement contains financial covenants regarding a maximum leverage ratio, and a minimum fixed charge coverage ratio. Obligations under the Amended and Restated Credit Agreement are guaranteed by Overnite and certain of our domestic subsidiaries, including Motor Cargo, and are secured by a first-priority lien on and security interest in all of the capital stock of Overnite Holding, Overnite, Inc. and OTC, as well as all the capital stock held by OTC and any guarantor under the Amended and Restated Credit Agreement. We maintained compliance with all of the covenants contained in the Amended and Restated Credit Agreement through March 31, 2005 on a quarterly basis, except for a minor technical default of a non-financial covenant. This matter was resolved with the lenders through a waiver and amendment to the Amended and Restated Credit Agreement.

On December 17, 2004, Overnite Transportation entered into an accounts receivable securitization facility with a bank and an issuer of commercial paper administered by the bank. The facility provides for the issuance of letters of credit, or in the alternative, borrowings, of up to an aggregate amount of $100 million, depending on the level of eligible trade accounts receivable. We use letters of credit to secure our obligations for worker’s compensation programs, other insurance programs and other obligations. Letters of credit outstanding under the facility amounted to $88.3 million as of March 31, 2005. The receivables facility is renewable annually and the scheduled expiration date is December 16, 2005. Under limited circumstances, primarily a decrease in the level of trade accounts receivable, the bank and the issuer of commercial paper can terminate the facility prior to the expiration date. This would result in the requirement to cash collateralize any outstanding letters of credit and/or repay any related outstanding indebtedness.

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Pension Plans

We provide defined pension benefits to eligible employees of OTC and Motor Cargo. OTC pension benefits are based on years of service and compensation during employment and cover substantially all employees. Motor Cargo pension benefits are based solely upon years of service.

We made contributions of $30.0 million to the pension plans in the three months ended March 31, 2005. We plan to contribute $45 million to the pension plans in 2005 although future contributions may be affected by a change in interest rates and returns generated on plan assets.

Critical Accounting Policies and Estimates

The preparation of our financial statements requires estimates and judgments that affect the reported amounts of revenues, expenses, assets and liabilities. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The following are our critical accounting policies that affect significant areas of our operations and involve judgments and estimates. If these estimates differ materially from actual results, the impact on the consolidated financial statements may be material.

Revenue Related Reserves, including Allowance for Uncollectible Accounts Receivable

Shipments in Transit: We calculate the value of revenue not yet delivered based on the percentage of completion method. We assign revenue to each shipment at the time of pick-up, based on the weight, classification, distance, special handling and with reference to current pricing terms and specific customer contracts. We calculate the value of undelivered revenue at the end of each month by specifically identifying the status of each undelivered shipment at month-end and calculating the resulting total. We believe this provides a reasonable estimate of the revenue actually earned each reporting period.

Uncollectible Receivables: We record an allowance for uncollectible accounts receivable based on historical collection experience. We also take into account known collectibility issues with specific customers and an estimate of future trends. We evaluate the creditworthiness of our major customers at least annually and of new customers on an ongoing basis. Our allowance for doubtful accounts was $19.9 million and $19.2 million at March 31, 2005 and December 31, 2004, respectively.

Payment Differences: In the event that a customer remits an amount different than the amount billed, we investigate and resolve the difference, which is normally a dispute of the weight, class of shipment or rate charged. We accrue for the difference that may have been incurred but not resolved based on historical trends, tempered by improvements to our systems and controls. At March 31, 2005 and December 31, 2004, the reserves amounted to $10.0 million and $9.7 million, respectively.

Claims and Insurance

We are self-insured to certain limits for workers’ compensation, property damage, cargo claims and injury liability claims. We accrue for cargo claims on a per-shipment basis using a method that takes into account the claims experience, including efforts to mitigate the original claim value, and lag time between shipment date and the filing date of the claim.

Claims and insurance costs, resulting from property damage, injury liability, and workers’ compensation, are accrued using current information and future estimates to arrive at an estimated ultimate value of claims, less recovery and mitigation credits. These ultimate values are based on assumptions related to the rates of growth in medical costs, general inflation, the normal elapsed time required to adjudicate and settle claims and a predicted

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pattern of injury severity for claims incurred but not reported. In many cases, independent actuaries are retained to render assistance so that we may value our reserve requirements in a way that is fair, complete and as accurate as possible based on the information available.

As of March 31, 2005 and December 31, 2004, our reserves for claims and insurance cost were $77.4 million and $78.2 million, respectively. The accuracy of our assumptions relating to claims and insurance costs may be affected by a number of factors. Based on the nature of our business, there may be temporary or permanent reductions or increases in the number of incidents, the severity of the incident and the secondary coverage provided by insurance. Other factors outside of our control that may contribute to claims and insurance costs include weather severity in parts of the country, road, bridge and tunnel condition and tire, brake and power train technology and performance. In the event that actual costs for claims and insurance exceed our original estimates, we will incur expenses in future periods. In addition, we may adjust our underlying assumptions that result in the estimated ultimate claim value. Any of these events could have a material effect on our financial results for future periods.

Healthcare, Pension and Other Post Employment Benefits

The operating companies provide defined benefit pension plans and defined contribution plans to eligible employees. Overnite Transportation also provides a postretirement health and life insurance plan (“OPEB”) and supplemental pension and supplemental defined contribution plans to eligible employees. The company also provides healthcare plans for eligible employees and their eligible dependents.

Independent consultants and actuaries are used to develop estimates of pension and OPEB costs. With regard to pension obligations, actuarial consultants provide valuations of the future obligations compared to the value of plan assets and earnings of the plan assets for the current and future years, using demographics of the current and future work force. We select the basic assumptions used to develop pension and OPEB costs, including an estimated rate of asset returns, salary increases, discount rates and rates of inflation of medical costs, the demographic assumptions of the current and future work force and life expectancy of the retired work force.

Expenses and required contributions to the Overnite Transportation and Motor Cargo pension plans have been determined based upon the use of market related values, which is a valuation method that recognizes changes in the value of assets over five years.

Overnite Transportation changed the health care plan for employees by replacing the traditional HMO programs with a new primarily self-insured Exclusive Provider Organization (“EPO”) administered on a nationwide basis beginning January 1, 2005. Approximately 70% of eligible employees are enrolled in the EPO plan. We anticipate that the EPO will help us manage costs in 2005 and beyond while increasing our employees’ access to health care and increasing their choices of providers. With this change approximately 97% of our employees are enrolled in primarily self-insured health care plans.

The assumptions we use to estimate healthcare, pension and OPEB costs may differ significantly from actual results due to a number of factors, including changing economic conditions, withdrawal rates, participant life spans and changes in actual costs of healthcare. These differences may have a material effect on the amount of expenses we record for these costs.

Goodwill and Intangible Assets

Under FASB Statement No. 142, “Goodwill and Other Intangible Assets” (“FAS 142”), goodwill and other intangible assets having indefinite useful lives are periodically tested for impairment and a charge is taken to the extent of any impairment. Under FAS 142, we are required to perform impairment tests at least annually, and we have elected to perform our annual impairment tests during the third quarter of each fiscal year. Impairment tests

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performed during the third quarter of 2004 did not result in any impairment. We are also required to perform impairment tests whenever events or changes in circumstances indicate that the carrying value of goodwill or intangible assets may not be recoverable.

The acquisition of Motor Cargo was accounted for as a purchase transaction and the purchase price was allocated among tangible assets, intangible assets, and goodwill, in accordance with FASB Statement No. 141, “Business Combinations” and FAS 142. We believe that the allocation of the purchase price is fair and reasonable. Our statement of financial position as of March 31, 2005 and December 31, 2004 includes a non-amortizable intangible asset related to the Motor Cargo brand name of $3.0 million and goodwill of $13.2 million.

Environmental Matters

We generate and transport hazardous and nonhazardous materials and we are subject to Federal, state and local environmental laws and regulations. A liability of $0.7 million has been accrued as of March 31, 2005 for future cleanup costs at all petroleum storage and hazardous substance release sites where our obligation is probable and where such costs can be reasonably estimated. We believe that we have adequately identified and estimated the ultimate share of costs at sites where we are alleged to be subject to joint and several liability. Future environmental obligations are not expected to have a material adverse effect on our business, financial condition or results of operations.

We have been notified by the United States Environmental Protection Agency that we are a potentially responsible party under the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA, at four hazardous waste sites. Under CERCLA, we may be jointly and severally liable for all site remediation and expenses. We have investigated the nature and costs of potential response actions at these sites and our own involvement, alone and in relation to the involvement of other named potentially responsible parties, in waste disposal or waste generation at such sites. We have either resolved such liabilities through de minimis settlements or we have taken the position that our obligations with respect to all such sites not subject to settlement will involve immaterial monetary liability, though there can be no assurances in this regard. Furthermore, we believe we are in material compliance with all laws applicable to our operations and we are not aware of any situation or condition that we believe is likely to have a material adverse effect on our business, financial condition or results of operation.

Seasonality

Our shipment level and revenue mix is subject to seasonal trends common in the transportation industry. Financial results in the first and fourth quarters are normally lower due to reduced shipments during the winter months. Harsh winter weather can also adversely impact our performance by reducing demand and increasing operating expenses including costs related to accidents. The second and third quarters generally reflect increased demand for services during the spring and summer months, which generally results in improved operating margins.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

When fuel costs per gallon exceed certain thresholds specified in our rules tariff or contracts, we seek to charge our customers a fuel surcharge. While we have historically been able to offset significant increases in fuel prices through fuel surcharges, we cannot be certain that we will be able to do so in the future. Accordingly, in order to protect against fluctuations in fuel prices that will not be covered by fuel surcharges, we have historically entered into fuel hedging arrangements. In the event we are not hedged, we are at risk to the extent that changes in the market price of fuel are not covered by our negotiated fuel surcharge arrangements. Alternatively, while the use of fuel hedging arrangements may provide us with protection from adverse fluctuations in fuel prices, by utilizing these arrangements we potentially forgo the benefits that might result from favorable fluctuations in fuel prices or, in some cases, we may incur hedging losses. We did not hedge any fuel in 2004 and have not hedged any of our remaining forecasted fuel consumption for 2005.

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Borrowings under the revolving loan facility bear interest, at our option, at either adjusted LIBOR plus a margin, which is based on our leverage ratio or the alternate base rate. A change of 0.5% in the interest rate will increase or decrease our interest expense by approximately $0.4 million on an annual basis at the current levels of debt.

Item 4. Controls and Procedures

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the Company’s disclosure controls and procedures pursuant to Rule 13a-15(e) under the Securities Exchange Act of 1934. Based upon that evaluation, the Company’s Chief Executive Officer and the Chief Financial Officer concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures are effective in alerting them, in a timely manner, to material information relating to the Company (including its consolidated subsidiaries) required to be included in the Company’s periodic SEC filings.

Additionally, during the period covered by this report, there has been no change in the Company’s internal control over financial reporting, as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are generally subject to litigation in the personal injury, property damage, freight claim, employment and labor areas. Legal actions in these and various other areas arising in the normal course of business, are pending. None of these legal actions currently pending against us is expected to have a material adverse effect on our business, financial condition or results of operations.

Item 4. Submission of Matters to a Vote of Security Holders

Item 6. Exhibits

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: May 9, 2005

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