MINNEAPOLIS--(BUSINESS WIRE)--April 24, 2007--C.H. Robinson
Worldwide, Inc. ("C.H. Robinson") (NASDAQ:CHRW), today reported
financial results for the quarter ended March 31, 2007.
Summarized financial results for the quarter ended March 31 are as
follows (dollars in thousands, except per share data):
Three months ended
March 31,
-----------------------------
2007 2006 % Change
-----------------------------
Gross profits $296,930 $255,057 16.4%
Operating income 115,189 92,434 24.6%
Net income 72,965 58,114 25.6%
Diluted EPS $0.42 $0.33 27.3%
Total Transportation gross profits increased 17.7 percent to
$262.4 million in the first quarter of 2007 from $223.0 million in the
first quarter of 2006. Our Transportation gross profit margin
increased to 20.2 percent in 2007 from 18.3 percent in 2006.
The increase in our Transportation gross profit margin in the
first quarter was due to an increase in our truck transportation gross
profit margins, which expanded due to more widely available truck
capacity in the marketplace. We also had faster growth in our
miscellaneous transportation management services business, which has a
higher gross profit margin than our Transportation business overall.
Our truck transportation gross profits increased 17.4 percent in
the first quarter of 2007. Our growth was driven by both increased
margins and increased volumes.
Our intermodal gross profits increase of 18.3 percent in the first
quarter resulted from an increase in gross profit margins, due to a
mix shift to more long-haul freight, which typically has higher
margins. Our volumes were consistent with the first quarter of 2006,
as the trucking environment in the first quarter of 2007 made truck
rates more competitive.
In our international freight forwarding business, our air and
ocean gross profits combined increased 16 percent in the first quarter
of 2007.
Miscellaneous transportation gross profits consist primarily of
transportation management fees, customs brokerage fees, and warehouse
and cross-dock services. The increase of 29.7 percent in the first
quarter was driven primarily by increases in our transportation
management business.
For the first quarter, Sourcing gross profits increased 7.1
percent to $23.9 million in 2007 from $22.3 million in 2006. Our
Sourcing gross profit margins declined from 8.2 percent in 2006 to 7.7
percent in 2007 due to higher market prices for certain produce
commodities, caused primarily by weather issues.
For the first quarter, operating expenses increased 11.8 percent
to $181.7 million in 2007 from $162.6 million in 2006. This was due to
an increase of 11.4 percent in personnel expenses and an increase of
12.9 percent in selling, general and administrative expenses.
As a percentage of gross profits, operating expenses decreased to
61.2 percent in the first quarter of 2007 from 63.8 percent in the
first quarter of 2006. This decrease was due to a decline in personnel
expenses as a percentage of gross profits from 49.9 percent to 47.7
percent. Expenses related to our restricted stock program and various
other incentive plans are based on growth in our earnings. Our
earnings grew slower in the first quarter of 2007 than in the first
quarter of 2006, which resulted in a decline in personnel expense as a
percentage of gross profit.
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 25,000
customers through a network of 214 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 45,000 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.; risks associated with the produce industry, including food
safety and contamination issues; 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 2007 Earnings Conference
Call
Wednesday, April 25, 2007 10:00 a.m. Eastern time
Live webcast available through Investor Relations link at
www.chrobinson.com
Telephone access:800-257-7063
Webcast replay available through April 28, 2007; Investor
Relations link at www.chrobinson.com
Telephone audio replay available until 12:59 a.m. Eastern Time on
April 28, 2007: 800-405-2236; passcode:11087430#
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(In thousands, except per share data)
-----------------------
Three months ended
March,
-----------------------
2007 2006
-----------------------
Gross Revenues:
Transportation $1,300,418 $1,215,909
Sourcing 308,297 273,422
Information Services 10,610 9,784
----------- -----------
Total gross revenues 1,619,325 1,499,115
----------- -----------
Gross Profits:
Transportation
Truck 229,139 195,133
Intermodal 9,380 7,931
Ocean 9,246 8,824
Air 6,834 5,044
Miscellaneous 7,828 6,035
----------- -----------
Total transportation 262,427 222,967
Sourcing 23,893 22,306
Information Services 10,610 9,784
----------- -----------
Total gross profits 296,930 255,057
----------- -----------
Operating costs and expenses:
Personnel expenses 141,776 127,211
Selling, general, and administrative
expenses 39,965 35,412
----------- -----------
Total operating expenses 181,741 162,623
----------- -----------
Income from operations 115,189 92,434
Investment and other income 3,596 2,665
----------- -----------
Income before provision for income taxes 118,785 95,099
Provision for income taxes 45,820 36,985
----------- -----------
Net income $72,965 $58,114
=========== ===========
Net income per share (basic) $0.43 $0.34
Net income per share (diluted) $0.42 $0.33
Weighted average shares outstanding (basic) 171,183 171,219
Weighted average shares outstanding (diluted) 174,888 175,267
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands)
March 31, December 31,
2007 2006
------------- ------------
Assets
Current assets:
Cash and cash equivalents $335,990 $348,592
Available-for-sale securities 126,824 124,767
Receivables, net 801,239 764,995
Other current assets 27,530 17,794
------------- ------------
Total current assets 1,291,583 1,256,148
Property and equipment, net 86,369 82,071
Intangible and other assets 304,720 293,474
------------- ------------
$1,682,672 $1,631,693
============= ============
Liabilities and stockholders' investment
Current liabilities:
Accounts payable and outstanding checks $583,892 $540,129
Accrued compensation 34,006 98,408
Other accrued expenses 76,882 48,412
------------- ------------
Total current liabilities 694,780 686,949
Long term liabilities 1,189 1,022
------------- ------------
Total liabilities 695,969 687,971
Total stockholders' investment 986,703 943,722
------------- ------------
$1,682,672 $1,631,693
============= ============
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
(In thousands, except operational data)
Three months ended
March 31,
---------------------
2007 2006
---------- ----------
Operating activities:
Net income $72,965 $58,114
Stock-based compensation 12,197 14,529
Depreciation and amortization 6,552 5,567
Other non-cash expenses, net (1,946) (1,244)
Net changes in operating elements (34,589) (20,872)
---------- ----------
Net cash provided by operating activities 55,179 56,094
Investing activities:
Net property additions (10,038) (6,477)
Cash paid for acquisitions (9,261) (7,974)
Purchases of available-for-sale securities (37,322) (39,163)
Sales/maturities of available-for-sale
securities 35,933 37,489
Other assets, net 167 1,750
---------- ----------
Net cash used for investing activities (20,521) (14,375)
Financing activities:
Net repurchases of common stock (22,646) (243)
Excess tax benefit from stock based
compensation plans 5,630 6,708
Cash dividends (31,348) (22,589)
---------- ----------
Net cash used for financing activities (48,364) (16,124)
Effect of exchange rates on cash 1,104 204
---------- ----------
Net change in cash and cash equivalents (12,602) 25,799
Cash and cash equivalents, beginning of period 348,592 230,628
---------- ----------
Cash and cash equivalents, end of period $335,990 $256,427
========== ==========
As of March 31,
---------------------
2007 2006
---------- ----------
Operational Data:
Employees 6,834 5,970
Branches 214 199
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.