MINNEAPOLIS--(BUSINESS WIRE)--April 25, 2006--C.H. Robinson
Worldwide, Inc. ("C.H. Robinson") (NASDAQ:CHRW), today reported
financial results for the three months ended March 31, 2006. As
previously reported, all share and per share data is reflective of a
two-for-one stock split, effective October 14, 2005.
For the first quarter, gross profits increased 27.9 percent to
$255.1 million from $199.4 million in 2005. Income from operations
increased 36.3 percent to $92.4 million from $67.8 million in 2005.
Net income increased 39.1 percent to $58.1 million from $41.8 million
in 2005. Diluted net income per share increased 37.5 percent to $0.33
per share from $0.24 per share in 2005.
For the first quarter, total Transportation gross profits
increased 28.3 percent to $223.0 million in 2006 from $173.8 million
in 2005. Our transportation gross profit margin increased to 18.3
percent in 2006 from 17.4 percent in 2005.
The increase in our truck transportation gross profits of 26.7
percent in the first quarter of 2006 was driven by volume growth in
truckload and less-than-truckload transactions, combined with
increased transportation rates and a slight increase in gross profit
margins.
Our intermodal gross profits increase of 14.0 percent in the first
quarter of 2006 resulted from an increase in gross profit margins,
offset by a decrease in volume. Our gross profit margin expanded due
to rate increases and the elimination of some lower margin business.
In our international freight forwarding business, our ocean gross
profits increased 55.9 percent and our air gross profits increased
89.1 percent in the first quarter of 2006. Excluding the impact of the
acquisitions of Bussini Transport S.r.l. ('Bussini') and Hirdes Group
Worldwide ('Hirdes'), announced in the third quarter of 2005, we
estimate our ocean gross profits would have increased approximately 35
percent in the first quarter of 2006. Our air gross profits would have
been approximately the same as the first quarter of 2005.
Miscellaneous transportation gross profits consist primarily of
transportation management fees, customs brokerage fees, and warehouse
and cross-dock services. The increase of 32.8 percent in the first
quarter was driven by increases in our transportation management fees
and customs brokerage business. Excluding the impact of the
acquisitions of Bussini and Hirdes, we estimate our miscellaneous
transportation gross profits increased approximately 27 percent.
For the first quarter, Sourcing gross profits increased 34.0
percent to $22.3 million in 2006 from $16.6 million in 2005. This
increase was due to higher volumes with our retail and foodservice
customers and a slight increase in our gross profit margin. Excluding
the acquisitions of FoodSource and Epic Roots, announced in the first
quarter of 2005, our Sourcing gross profits increased 11.4 percent.
For the first quarter, Information Services gross profits
increased 10.0 percent to $9.8 million in 2006 from $8.9 million in
2005, primarily due to transaction volume growth.
For the quarter, operating expenses increased 23.6 percent to
$162.6 million in 2006 from $131.6 million in 2005. As a percentage of
gross profits, operating expenses decreased to 63.8 percent in 2006
from 66.0 percent in 2005. We gain leverage in periods of strong
growth.
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 20,500
customers through a network of 199 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 40,000 carriers 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 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 2006 Earnings Conference Call
Wednesday, April 26, 2006 10:00 a.m. Eastern time
Live webcast available through Investor Relations link at
www.chrobinson.com
Telephone access: 800-257-2101
Webcast replay available through May 10, 2006; Investor Relations link
at www.chrobinson.com
Telephone audio replay available until 12:59 a.m. Eastern Time on
April 29, 2006: 800-405-2236; passcode: 11058272#
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(In thousands, except per share data)
Three months ended
March 31,
----------------------
2006 2005
----------- ----------
Gross revenues:
Transportation $1,215,909 $999,936
Sourcing 273,422 206,109
Information Services 9,784 8,895
----------- ----------
Total gross revenues 1,499,115 1,214,940
----------- ----------
Gross profits:
Transportation
Truck 195,133 154,020
Intermodal 7,931 6,956
Ocean 8,824 5,660
Air 5,044 2,667
Miscellaneous 6,035 4,543
----------- ----------
Total transportation 222,967 173,846
Sourcing 22,306 16,641
Information Services 9,784 8,895
----------- ----------
Total gross profits 255,057 199,382
----------- ----------
Operating costs and expenses:
Personnel expenses 127,211 100,929
Selling, general and administrative expenses 35,412 30,661
----------- ----------
Total operating costs and expenses 162,623 131,590
----------- ----------
Income from operations 92,434 67,792
Investment and other income:
Interest income and other 2,583 1,014
Nonqualified deferred compensation investment
gain 82 117
----------- ----------
Investment and other income 2,665 1,131
----------- ----------
Income before provision for income
Taxes 95,099 68,923
Provision for income taxes 36,985 27,147
----------- ----------
Net income $58,114 $41,776
=========== ==========
Net income per share (basic) $0.34 $0.25
Net income per share (diluted) $0.33 $0.24
Weighted average shares outstanding (basic) 171,219 169,876
Weighted average shares outstanding (diluted) 175,267 174,132
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands)
March 31, December 31,
2006 2005
------------- ------------
Assets
Current assets:
Cash and cash equivalents $256,427 $230,628
Available-for-sale securities 124,225 122,551
Receivables, net 706,968 716,725
Other current assets 21,157 14,877
------------- ------------
Total current assets 1,108,777 1,084,781
Property and equipment, net 62,497 60,721
Intangible and other assets 255,165 249,566
------------- ------------
$1,426,439 $1,395,068
============= ============
Liabilities and stockholders' investment
Current liabilities
Accounts payable and outstanding checks $487,674 $473,882
Accrued compensation 31,762 94,333
Other accrued expenses 64,856 44,268
------------- ------------
Total current liabilities 584,292 612,483
Long term liabilities:
Deferred tax liability - 1,469
Nonqualified deferred compensation
obligation 1,238 1,079
------------- ------------
Total long term liabilities 1,238 2,548
------------- ------------
Total liabilities 585,530 615,031
Total stockholders' investment 840,909 780,037
------------- ------------
$1,426,439 $1,395,068
============= ============
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands, except operational data)
Three months ended
March 31,
-------------------
2006 2005
--------- ---------
Operating activities:
Net income $58,114 $41,776
Stock-based compensation 14,529 9,323
Depreciation and amortization 5,567 3,883
Other non-cash expenses, net (1,244) 3,192
Net changes in operating elements (20,872) (34,560)
--------- ---------
Net cash provided by operating activities 56,094 23,614
Investing activities:
Net property additions (6,477) (8,505)
Cash paid for acquisitions (7,974) (43,590)
Purchases of available-for-sale securities (39,163) (8,771)
Sales/maturities of available-for-sale
securities 37,489 8,204
Other assets, net 1,750 (1,185)
--------- ---------
Net cash used for investing activities (14,375) (53,847)
Financing activities:
Net issuances (repurchases) of common stock (243) 1,695
Excess tax benefit from stock based
compensation plans 6,708 900
Cash dividends (22,589) (12,832)
--------- ---------
Net cash used for financing activities (16,124) (10,237)
Effect of exchange rates on cash 204 (770)
--------- ---------
Net increase (decrease) in cash and cash
equivalents 25,799 (41,240)
Cash and cash equivalents, beginning of period 230,628 166,476
--------- ---------
Cash and cash equivalents, end of period $256,427 $125,236
========= =========
As of March 31,
-------------------
2006 2005
--------- ---------
Operational Data:
Employees 5,970 5,029
Branches 199 178
C.H. Robinson Worldwide, Inc.
Chad Lindbloom, chief financial officer, 1-952-937-7779
Angie Freeman, vice president, 1-952-937-7847
"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.