MINNEAPOLIS--(BUSINESS WIRE)--April 26, 2005--C.H. Robinson
Worldwide, Inc. ("C.H. Robinson") (NASDAQ:CHRW), today reported
financial results for the three months ended March 31, 2005.
For the first quarter, gross profits increased 33.3 percent to
$199.4 million in 2005 from $149.6 million in 2004. Income from
operations increased 43.7 percent to $67.8 million in the first
quarter of 2005 from $47.2 million in the first quarter of 2004. Net
income increased 43.7 percent to $41.8 million in the first quarter of
2005 from $29.1 million in the first quarter of 2004. Diluted net
income per share increased 41.2 percent to $0.48 per share in the
first quarter of 2005 from $0.34 per share in the first quarter of
2004.
"The year began with a high demand for our services in the
marketplace," said John P. Wiehoff, chief executive officer of C.H.
Robinson. "In the first quarter, we continued to use current market
conditions as an opportunity both to build new relationships and to
strengthen existing ones. Our acquisitions of FoodSource and Epic
Roots helped our Sourcing business to a strong start. We continue to
invest in our foundation of people and locations for the future.
Including these acquisitions, we added 223 employees and two new
branch locations to our network in the quarter."
For the first quarter, total Transportation gross profits
increased 33.9 percent to $173.8 million in 2005 from $129.8 million
in 2004. Our Transportation gross profit margin increased slightly
from the first quarter of 2004.
The increase in our truck transportation gross profits of 36.4
percent in the first quarter of 2005 was driven by volume growth in
both truckload and less-than-truckload transactions and an increase in
gross profit margin. We expanded relationships with a diverse mix of
existing and new customers. Our decentralized network of branch
offices continues to be an advantage in gaining new, local accounts
and enhancing our ability to service customers and carriers.
Our intermodal gross profits decrease of 6.8 percent in the first
quarter of 2005 resulted from a decrease in volumes and a decrease in
gross profit margins. Our volume and margins were impacted by
increased costs, service lane eliminations, and regional service
disruptions that continue to drive business back to truck service.
Our international ocean gross profits increased 30.6 percent in
the first quarter of 2005. This growth includes the impacts of our
June 2004 expansion into China and growth in volumes with several of
our large international customers. We are continuing to broaden our
relationships with existing customers to include international
transportation and customs brokerage services.
Our air gross profits, which are primarily international,
increased 52.8 percent in the first quarter of 2005. The significant
growth in our air gross profits was primarily due to increased volumes
with several large international customers.
Miscellaneous transportation gross profits consist of
transportation management fees, customs brokerage fees, warehouse and
cross-dock services, and other miscellaneous transportation related
services. The increase of 35.9 percent in the first quarter was driven
by increases in our transportation management fees and customs
brokerage business.
For the first quarter, Sourcing gross profits increased 40.7
percent to $16.6 million in 2005 from $11.8 million in 2004. Excluding
the impact of the acquisitions of FoodSource and Epic Roots, announced
on February 14, 2005, our internal growth rate of Sourcing gross
profits was 10 percent. We have continued to have success growing our
business with retailers and foodservice providers. In 2004, volatile
prices for certain produce items negatively impacted our volumes. We
have entered into more favorable arrangements with both suppliers and
customers to reduce this volatility.
For the first quarter, Information Services gross profits
increased 12.3 percent to $8.9 million in 2005 from $7.9 million in
2004, primarily due to transaction growth.
For the quarter, personnel expense as a percentage of gross
profits decreased to 50.6 percent in 2005 from 51.9 percent in 2004.
Average gross profits per employee, a key measure of productivity,
increased approximately 13 percent in 2005 compared to 2004. While
many of our personnel expenses are variable, we gain leverage in
periods of growth.
For the quarter, selling, general, and administrative expenses
increased 23.4 percent to $30.7 million in 2005 from $24.8 million in
2004. Selling, general, and administrative expenses as a percentage of
gross profits decreased for the first quarter of 2005 to 15.4 percent
compared to 16.6 percent in 2004.
Founded in 1905, C.H. Robinson Worldwide, Inc., is one of the
largest third-party logistics companies in North America. C.H.
Robinson is a global provider of multimodal transportation services
and logistics solutions, currently serving 18,000 customers through a
network of 178 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 35,000
carriers worldwide. C.H. Robinson is one of the largest third-party
providers of intermodal services in the United States.
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 market
demand and pressures on the pricing for our services; competition and
growth rates within the third-party logistics industry; freight levels
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.; changing economic conditions such as general economic slowdown,
decreased consumer confidence, fuel shortages and the impact of war on
the economy; and other risks and uncertainties detailed in our Annual
and Quarterly Reports.
Conference Call Information:
----------------------------
C.H. Robinson Worldwide First Quarter 2005 Earnings Conference Call
Wednesday, April 27, 2005; 11:00 a.m. Eastern time
Live webcast available through Investor Relations at
www.chrobinson.com
Telephone access: 800-240-2134
Webcast replay available through May 12, 2005: Investor Relations at
www.chrobinson.com
Telephone audio replay available through April 29, 2005: 800-405-2236;
passcode: 11028123#
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(In thousands, except per share data)
Three months ended
March 31,
---------------------
2005 2004
---------- ----------
Gross revenues:
Transportation $999,936 $772,449
Sourcing 206,109 166,243
Information Services 8,895 7,918
---------- ----------
Total gross revenues 1,214,940 946,610
---------- ----------
Gross profits:
Transportation
Truck 154,020 112,956
Intermodal 6,956 7,463
Ocean 5,660 4,333
Air 2,667 1,745
Miscellaneous 4,543 3,343
---------- ----------
Total transportation 173,846 129,840
Sourcing 16,641 11,826
Information Services 8,895 7,918
---------- ----------
Total gross profits 199,382 149,584
---------- ----------
Operating costs and expenses:
Personnel expenses 100,929 77,574
Selling, general and administrative expenses 30,661 24,839
---------- ----------
Total operating costs and expenses 131,590 102,413
---------- ----------
Income from operations 67,792 47,171
Investment and other income:
Interest income and other 1,014 587
Nonqualified deferred compensation investment
gain 117 70
---------- ----------
Investment and other income 1,131 657
---------- ----------
Income before provision for income Taxes 68,923 47,828
Provision for income taxes 27,147 18,756
---------- ----------
Net income $41,776 $29,072
========== ==========
Net income per share (basic) $0.49 $0.34
Net income per share (diluted) $0.48 $0.34
Weighted average shares outstanding (basic) 84,938 84,621
Weighted average shares outstanding (diluted) 87,066 86,414
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands)
March 31, December 31,
2005 2004
------------ ------------
Assets
Current assets:
Cash and cash equivalents $125,236 $166,476
Available-for-sale securities 122,174 121,600
Receivables 599,784 544,274
Other current assets 17,897 13,637
------------ ------------
Total current assets 865,091 845,987
Net property and equipment 57,178 51,122
Intangible and other assets 234,435 183,587
------------ ------------
$1,156,704 $1,080,696
============ ============
Liabilities and stockholders' investment
Current liabilities:
Accounts payable and outstanding checks $399,391 $358,929
Accrued compensation 29,394 60,261
Other accrued expenses 50,015 33,629
------------ ------------
Total current liabilities 478,800 452,819
Long term liabilities:
Deferred tax liability 6,218 4,153
Nonqualified deferred compensation
obligation 3,119 2,868
------------ ------------
Total long term liabilities 9,337 7,021
------------ ------------
Total liabilities 488,137 459,840
Total stockholders' investment 668,567 620,856
------------ ------------
$1,156,704 $1,080,696
============ ============
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands, except operational data)
Three months ended
March 31,
-------------------
2005 2004
--------- ---------
Operating activities:
Net income $41,776 $29,072
Depreciation and amortization 3,883 2,634
Other non-cash expenses 10,664 8,182
Net changes in operating elements (31,809) (25,414)
--------- ---------
Net cash provided by operating activities 24,514 14,474
Investing activities:
Net property additions (8,505) (11,625)
Cash paid for acquisitions (43,590) (7,302)
Net purchases of investments (567) (118)
Other assets, net (1,185) 24
--------- ---------
Net cash used for investing activities (53,847) (19,021)
Financing activities:
Net issuance of common stock 1,695 634
Cash dividends (12,832) (10,247)
--------- ---------
Net cash used for financing activities (11,137) (9,613)
Effect of exchange rates on cash (770) (725)
--------- ---------
Net decrease in cash and cash equivalents (41,240) (14,885)
Cash and cash equivalents, beginning of period 166,476 123,413
--------- ---------
Cash and cash equivalents, end of period $125,236 $108,528
========= =========
As of March 31,
----------------
Operational Data: 2005 2004
------- -------
Employees 5,029 4,231
Branches 178 160
CONTACT: C.H. Robinson Worldwide, Inc., Eden Prairie
C.H. Robinson Worldwide, Inc.
Chad Lindbloom, chief financial officer, 1-952-937-7779
Angie Freeman, vice president, 1-952-937-7847
Source: C.H. Robinson Worldwide, Inc.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding C.H. Robinson Worldwide Inc's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.