Close

C.H. Robinson Reports Second Quarter Results

FREE Breaking News Alerts from StreetInsider.com!

E-mail Address

StreetInsider.com Top Tickers, 4/18/2024

1. UAL
2. JBHT
3. TSLA
4. SAGE
5. TRV
6. ASML
7. LVS
8. SPY
9. PLD
10. TSM


July 28, 2015 4:15 PM EDT

MINNEAPOLIS--(BUSINESS WIRE)-- C.H. Robinson Worldwide, Inc. (“C.H. Robinson”) (NASDAQ: CHRW), today reported financial results for the quarter ended June 30, 2015. Summarized financial results for the quarter ended June 30 are as follows (dollars in thousands, except per share data):

   
Three months ended June 30, Six months ended June 30,

2015

 

2014

 

%change

2015

 

2014

 

%change

       
Total revenues $ 3,545,088 $ 3,502,918 1.2% $ 6,845,978 $ 6,645,503 3.0%
 

Net revenues:

Transportation

Truckload (1)

$ 334,546 $ 308,152 8.6% $ 632,926 $ 580,499 9.0%
LTL 91,524 67,376 35.8% 176,894 127,514 38.7%
Intermodal 11,539 10,863 6.2% 22,051 19,803 11.4%
Ocean 59,066 50,486 17.0% 109,256 94,098 16.1%
Air 19,596 21,747 -9.9% 40,235 39,201 2.6%
Customs 10,973 10,312 6.4% 21,236 19,644 8.1%
Other logistics services   21,104       17,207   22.6%   40,895       35,773   14.3%
Total transportation 548,348 486,143 12.8% 1,043,493 916,532 13.9%
Sourcing   35,670       34,894   2.2%   65,635       61,740   6.3%
Total net revenues 584,018 521,037 12.1% 1,109,128 978,272 13.4%
 

Operating expenses

 

354,923

     

320,655

 

10.7%

 

698,108

     

620,919

 

12.4%

Operating income 229,095 200,382 14.3% 411,020 357,353 15.0%
Net income $ 137,208     $ 118,596   15.7% $ 243,684     $ 211,783   15.1%
Diluted EPS $ 0.94 $ 0.80 17.5% $ 1.67 $ 1.43 16.8%
 

(1) Includes Payment Services revenues which were previously reported separately.

 

“We had a great quarter with strong net revenue and net income growth across our network,” said John Wiehoff, CEO and Chairman. “Our employees worked very hard, serving our customers, carriers, and suppliers with a focus on excellence and improving every day.”

Our truckload net revenues increased 8.6 percent in the second quarter of 2015 compared to the second quarter of 2014. Our acquisition of Freightquote.com (“Freightquote”) on January 1, 2015 contributed approximately 3.5 percentage points to our truckload net revenue growth. Our North American truckload volumes increased approximately seven percent. Approximately three percent of this increase was due to the acquisition of Freightquote. Our truckload net revenue margin increased in the second quarter of 2015 compared to the second quarter of 2014, due primarily to the lower cost of fuel. In North America, excluding the estimated impacts of the change in fuel prices, our average truckload rate per mile charged to our customers increased approximately three percent in the second quarter of 2015 compared to the second quarter of 2014. In North America, our truckload transportation costs increased approximately 2.5 percent, excluding the estimated impacts of the change in fuel prices.

Our less-than-truckload (“LTL”) net revenues increased 35.8 percent in the second quarter of 2015 compared to the second quarter of 2014. Freightquote contributed approximately 33 percentage points to our LTL net revenue growth in the second quarter of 2015. LTL volumes increased approximately 33 percent in the second quarter of 2015 compared to the second quarter of 2014. Freightquote contributed approximately 20 percentage points to our LTL volume growth in the second quarter of 2015. Net revenue margin increased in the second quarter of 2015 compared to the second quarter of 2014. This was primarily the result of a change in our freight mix with more small customers from the higher margin Freightquote business.

Our intermodal net revenues increased 6.2 percent in the second quarter of 2015 compared to the second quarter of 2014. Freightquote contributed approximately nine percentage points to our intermodal net revenue growth in the second quarter of 2015. Excluding Freightquote, intermodal transactional volume decreased in the second quarter of 2015 compared to the second quarter of 2014.

Our ocean transportation net revenues increased 17.0 percent in the second quarter of 2015 compared to the second quarter of 2014. The increase in net revenues was primarily due to increased net revenue margin as volumes were flat.

Our air transportation net revenues decreased 9.9 percent in the second quarter of 2015 compared to the second quarter of 2014. The decrease was due to lower rates charged to our customers, offset slightly by increased net revenue margin and a small increase in volumes.

Our customs net revenues increased 6.4 percent in the second quarter of 2015 compared to the second quarter of 2014. The increase was due to increased transaction volumes.

Our other logistics services revenues, which includes managed services, warehousing, and small parcel, increased 22.6 percent in the second quarter of 2015 compared to the second quarter of 2014 primarily from growth in managed services. Freightquote contributed approximately two percentage points to our other logistics services net revenue growth in the second quarter of 2015.

Sourcing net revenues increased 2.2 percent in the second quarter of 2015 compared to the second quarter of 2014. This increase was primarily due to a case volume increase across a variety of commodities and services offset partially by a decline in net revenue per case.

For the second quarter, operating expenses increased 10.7 percent to $354.9 million in 2015 from $320.7 million in 2014. Operating expenses as a percentage of net revenues decreased to 60.8 percent in the second quarter of 2015 from 61.5 percent in the second quarter of 2014.

For the second quarter, personnel expenses increased 10.5 percent to $264.0 million in 2015 from $239.0 million in 2014. This was primarily due to additional headcount related to our acquisition of Freightquote and expenses related to incentive plans that are designed to keep expenses variable with changes in net revenues and profitability. For the second quarter, our average headcount grew 10.1 percent compared to the second quarter of 2014.

For the second quarter, other selling, general, and administrative expenses increased 11.3 percent to $90.9 million in 2015 from $81.7 million in 2014. This increase was primarily due to our acquisition of Freightquote including amortization expense of approximately $1.9 million, and an increase in travel expenses.

About C.H. Robinson

Founded in 1905, C.H. Robinson Worldwide, Inc., is one of the largest non-asset based third party logistics companies in the world. C.H. Robinson is a global provider of multimodal transportation services and logistics solutions, currently serving over 46,000 active customers through a network of offices in North America, South America, Europe, and Asia. C.H. Robinson maintains one of the largest networks of motor carrier capacity in North America and works with approximately 66,000 transportation providers worldwide.

Except for the historical information contained herein, the matters set forth in this release are forward-looking statements that represent our expectations, beliefs, intentions or strategies concerning future events. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience or our present expectations, including, but not limited to such factors as changes in economic conditions, including uncertain consumer demand; changes in market demand and pressures on the pricing for our services; competition and growth rates within the third party logistics industry; freight levels and increasing costs and availability of truck capacity or alternative means of transporting freight, and changes in relationships with existing truck, rail, ocean and air carriers; changes in our customer base due to possible consolidation among our customers; our ability to integrate the operations of acquired companies with our historic operations successfully; risks associated with litigation and insurance coverage; risks associated with operations outside of the U.S.; risks associated with the potential impacts of changes in government regulations; risks associated with the produce industry, including food safety and contamination issues; fuel prices and availability; the impact of war on the economy; and other risks and uncertainties detailed in our Annual and Quarterly Reports.

Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update such statement to reflect events or circumstances arising after such date. All remarks made during our financial results conference call will be current at the time of the call and we undertake no obligation to update the replay.

Conference Call Information:C.H. Robinson Worldwide Second Quarter 2015 Earnings Conference CallWednesday, July 29, 2015 8:30 a.m. Eastern TimeThe call will be limited to 60 minutes, including questions and answers. We invite call participants to submit questions in advance of the conference call and we will respond to as many of the questions as we can in the time allowed. To submit your question(s) in advance of the call, please email [email protected].

Presentation slides and a simultaneous live audio webcast of the conference call may be accessed through the Investor Relations link on C.H. Robinson’s website at www.chrobinson.com.To participate in the conference call by telephone, please call ten minutes early by dialing: 888-516-2441International callers dial +1-719-325-2280Callers should reference the conference ID, which is 3923556Webcast replay available through Investor Relations link at www.chrobinson.comTelephone audio replay available until 11:30 a.m. Eastern Time on August 5, 2015: 888-203-1112; passcode: 3923556#International callers dial +1-719-457-0820

 
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands, except per share data)
 
 

Three months endedJune 30,

 

Six months endedJune 30,

2015   2014 2015   2014
 
Revenues:
Transportation (1) $ 3,130,722 $ 3,042,102 $ 6,077,979 $ 5,848,879
Sourcing   414,366     460,816     767,999     796,624  
Total revenues   3,545,088     3,502,918     6,845,978     6,645,503  
 
Costs and expenses:
Purchased transportation and related services (1) 2,582,374 2,555,959 5,034,486 4,932,347
Purchased products sourced for resale 378,696 425,922 702,364 734,884
Personnel expenses 263,999 238,986 519,143 459,283
Other selling, general, and administrative expenses   90,924     81,669     178,965     161,636  
Total costs and expenses   3,315,993     3,302,536     6,434,958     6,288,150  
 
Income from operations   229,095     200,382     411,020     357,353  
 
Interest and other expense   (5,894 )   (6,252 )   (15,499 )   (12,383 )
 
Income before provision for income taxes 223,201 194,130 395,521 344,970
Provisions for income taxes   85,993     75,534     151,837     133,187  
Net income $ 137,208   $ 118,596   $ 243,684   $ 211,783  
 
Net income per share (basic) $ 0.94 $ 0.80 $ 1.67 $ 1.43
Net income per share (diluted) $ 0.94 $ 0.80 $ 1.67 $ 1.43
 
Weighted average shares outstanding (basic) 145,515 147,826 145,856 148,167
Weighted average shares outstanding (diluted) 145,679 147,974 146,020 148,293
 

(1) Includes Payment Services revenues and related costs which were previously reported separately.

 
 
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
 
 

June 30,2015

 

December 31,2014

Assets
Current assets:
Cash and cash equivalents $ 171,451 $ 128,940
Restricted cash - 359,388
Receivables, net 1,706,429 1,571,591
Other current assets   66,459   45,540
Total current assets 1,944,339 2,105,459
 
Property and equipment, net 190,849 152,471
Intangible and other assets   1,268,826   956,408
Total assets $ 3,404,014 $ 3,214,338
 
Liabilities and stockholders’ investment
Current liabilities:
Accounts payable and outstanding checks $ 894,046 $ 795,255
Accrued compensation 95,528 125,624
Accrued income taxes 25,536 4,616
Other accrued expenses 49,708 45,365
Current portion of debt   630,000   605,000
Total current liabilities 1,694,818 1,575,860
 
Noncurrent income taxes payable 22,723 24,279
Deferred tax liabilities 74,394 66,961
Long-term debt 500,000 500,000
Other long term liabilities   228   223
Total liabilities 2,292,163 2,167,323
 
Total stockholders’ investment   1,111,851   1,047,015
Total liabilities and stockholders’ investment $ 3,404,014 $ 3,214,338
 
 
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited, in thousands, except operational data)
 
 

Six months endedJune 30,

2015   2014
Operating activities:
Net income $ 243,684 $ 211,783
Stock-based compensation 31,019 16,423
Depreciation and amortization 32,682 29,349
Provision for doubtful accounts 9,053 11,128
Deferred income taxes (1,780 ) 5,894
Other 438 (1,348 )
Changes in operating elements, net of acquisitions:
Receivables (87,663 ) (261,334 )
Prepaid expenses and other (19,802 ) (14,214 )
Other non-current assets 736 270
Accounts payable and outstanding checks 56,891 121,109
Accrued compensation and profit-sharing contribution (32,027 ) (6,137 )
Accrued income taxes 21,230 12,698
Other accrued liabilities   (3,265 )   2,747  
Net cash provided by operating activities 251,196 128,368
 
Investing activities:
Purchases of property and equipment (11,542 ) (14,860 )
Purchases and development of software (8,063 ) (3,964 )
Restricted cash 359,388 -
Acquisitions, net of cash (369,143 ) -
Other   361     268  
Net cash used for investing activities (28,999 ) (18,556 )
 
Financing activities:
Borrowings on line of credit 3,893,000 2,435,000
Repayments on line of credit (3,868,000 ) (2,410,000 )
Net repurchases of common stock (90,255 ) (52,740 )
Excess tax benefit on stock-based compensation 6,040 5,198
Cash dividends   (114,517 )   (104,909 )
Net cash used for financing activities (173,732 ) (127,451 )
Effect of exchange rates on cash   (5,954 )   (193 )
 
Net change in cash and cash equivalents 42,511 (17,832 )
Cash and cash equivalents, beginning of period   128,940     162,047  
Cash and cash equivalents, end of period $ 171,451   $ 144,215  
 
As of June 30,
2015 2014
Operational Data:
Employees 13,068 11,645
 

C.H. Robinson Worldwide, Inc.
Andrew Clarke, 952-683-3474
Chief Financial Officer
or
Tim Gagnon, 952-683-5007
Director, Investor Relations

Source: C.H. Robinson Worldwide, Inc.


Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

Press Releases

Related Entities

Dividend, Earnings, Definitive Agreement