MINNEAPOLIS, Apr 22, 2008 (BUSINESS WIRE) -- C.H. Robinson Worldwide, Inc. ("C.H. Robinson") (NASDAQ: CHRW),
today reported financial results for the quarter ended March 31, 2008.
Summarized financial results for the quarter ended March 31 are as
follows (dollars in thousands, except per share data):
Three months ended
March 31,
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2008 2007 % Change
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Gross revenues $ 1,985,212 $ 1,619,325 22.6%
Gross profits 338,029 296,930 13.8%
Operating income 136,077 115,189 18.1%
Net income 86,318 72,965 18.3%
Diluted EPS $ 0.50 $ 0.42 19.0%
Total Transportation gross profits increased 13.8 percent to
$298.7 million in the first quarter of 2008 from $262.4 million in the
first quarter of 2007. Our Transportation gross profit margin
decreased to 18.2 percent in 2008 from 20.2 percent in 2007 due to
gross profit margin declines in several of our transportation modes.
Our truck gross profits consist of truckload and
less-than-truckload ("LTL") services. Our truck gross profit growth of
13.2 percent in the first quarter of 2008 was driven by volume growth,
offset by declines in our truckload gross profit margins. Our
truckload volumes increased approximately 15 percent. Including fuel,
our truckload rates increased approximately 8 percent; excluding
estimated impacts of fuel, underlying linehaul rates decreased
approximately 2 percent. Our truckload gross profit margins declined
due to higher fuel prices and declining truckload rates. Our LTL
shipments increased approximately 30 percent. Our LTL gross profit
margins were consistent with the first quarter of 2007.
Our intermodal gross profit decrease of 2.2% percent in the first
quarter was due to a decline in our gross profit margins, partially
offset by a double-digit increase in volumes. Our gross profit margin
decline was due to a change in our mix of business from higher-margin,
transactional opportunities to more contractual intermodal business,
and also increased cost of capacity in certain lanes.
The increase of 32.5 percent in our ocean transportation gross
profits in the first quarter of 2008 was driven by double-digit volume
growth and price increases, offset partially by a decline in gross
profit margins. Our volume growth was driven in part by project-based
business.
In our air transportation business, approximately two-thirds of
our gross profit growth of 17.8 percent in the first quarter of 2008
came from our domestic air business, which includes our
previously-disclosed acquisition of LXSI Services Inc. on July 13,
2007.
Miscellaneous transportation gross profits consist primarily of
transportation management fees and customs brokerage fees. The
increase of 26.0 percent in the first quarter was driven primarily by
volume growth in transportation management.
For the first quarter, Sourcing gross profits increased 13.2
percent to $27.1 million in 2008 from $23.9 million in 2007, due to
higher volumes and an increase in our gross profit margin. We
continued to have success growing our business with retailers and
foodservice providers.
Our Information Services gross profits grew 16.0 percent in the
first quarter of 2008. Our growth was driven by volume growth in our
core fuel card and cash advance services and an increase in our
revenue per transaction, due to the price of fuel. With certain
merchants our fee is based on a percentage of the sale amount.
Approximately one-third of the growth was related to other services,
such as fleet card and carrier compliance services.
For the first quarter, operating expenses increased 11.1 percent
to $202.0 million in 2008 from $181.7 million in 2007. This was due to
an increase of 8.4 percent in personnel expenses and an increase of
20.6 percent in selling, general and administrative expenses.
As a percentage of gross profits, total operating expenses
decreased to 59.7 percent in the first quarter of 2008 from 61.2
percent in the first quarter of 2007. This decrease was due to a
decline in personnel expenses as a percentage of gross profits from
47.7 percent to 45.5 percent, offset partially by an increase in our
selling, general and administrative expenses as a percentage of gross
profits. Expenses related to our restricted stock program and various
other incentive plans are variable, based on growth in our earnings.
Our slower earnings growth in the first quarter of 2008 compared to
the first quarter of 2007 resulted in a decrease in expense related to
some of these incentives plans. This contributed to our personnel
expenses growing slower than our gross profits.
The increase in our selling, general, and administrative expenses
was driven by increased spending in most expense categories, including
occupancy and travel, to support our future plans.
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 29,000
customers through a network of 220 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 48,000 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 2008 Earnings Conference
Call
Tuesday, April 22, 2008 5:00 p.m. Eastern time
Live webcast available through Investor Relations link at
www.chrobinson.com
Telephone access: 800-218-0530
Webcast replay available through May 5, 2008; Investor Relations
link at www.chrobinson.com
Telephone audio replay available until 12:59 a.m. Eastern Time on
April 25, 2008: 800-405-2236;
passcode: 11111110#
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(In thousands, except per share data)
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Three months ended
March 31,
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2008 2007
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Gross Revenues:
Transportation $ 1,641,612 $ 1,300,418
Sourcing 331,297 308,297
Information Services 12,303 10,610
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Total gross revenues 1,985,212 1,619,325
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Gross Profits:
Transportation
Truck 259,323 229,139
Intermodal 9,178 9,380
Ocean 12,255 9,246
Air 8,050 6,834
Miscellaneous 9,867 7,828
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Total transportation 298,673 262,427
Sourcing 27,053 23,893
Information Services 12,303 10,610
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Total gross profits 338,029 296,930
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Operating costs and expenses:
Personnel expenses 153,754 141,776
Selling, general, and administrative
expenses 48,198 39,965
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Total operating expenses 201,952 181,741
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Income from operations 136,077 115,189
Investment and other income 2,474 3,596
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Income before provision for income taxes 138,551 118,785
Provision for income taxes 52,233 45,820
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Net income $ 86,318 $ 72,965
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Net income per share (basic) $ 0.51 $ 0.43
Net income per share (diluted) $ 0.50 $ 0.42
Weighted average shares outstanding
(basic) 169,858 171,183
Weighted average shares outstanding
(diluted) 174,028 174,888
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands)
March 31, December 31,
2008 2007
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Assets
Current assets:
Cash and cash equivalents $ 379,846 $ 338,885
Available-for-sale securities 34,888 115,842
Receivables, net 1,006,355 911,780
Other current assets 30,779 22,649
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Total current assets 1,451,868 1,389,156
Property and equipment, net 102,164 101,665
Intangible and other assets 319,754 320,486
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$ 1,873,786 $ 1,811,307
============= =============
Liabilities and stockholders' investment
Current liabilities:
Accounts payable and outstanding
checks $ 672,623 $ 618,195
Accrued compensation 41,262 101,926
Other accrued expenses 68,853 37,498
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Total current liabilities 782,738 757,619
Long term liabilities 12,110 11,439
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Total liabilities 794,848 769,058
Total stockholders' investment 1,078,938 1,042,249
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$ 1,873,786 $ 1,811,307
============= =============
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
(In thousands, except operational data)
Three months ended
March 31,
-------------------------
2008 2007
------------ ------------
Operating activities:
Net income $ 86,318 $ 72,965
Stock-based compensation 8,255 12,197
Depreciation and amortization 7,663 6,552
Other non-cash expenses, net 3,602 4,454
Net changes in operating elements (80,106) (40,989)
------------ ------------
Net cash provided by operating
activities 25,732 55,179
Investing activities:
Net property additions (5,928) (10,038)
Cash paid for acquisitions - (9,261)
Purchases of available-for-sale
securities (99,944) (37,322)
Sales/maturities of available-for-sale
securities 181,254 35,933
Other assets, net 500 167
------------ ------------
Net cash provided by (used for)
investing activities 75,882 (20,521)
Financing activities:
Net repurchases of common stock (31,847) (22,646)
Excess tax benefit from stock based
compensation plans 7,711 5,630
Cash dividends (37,996) (31,348)
------------ ------------
Net cash used for financing
activities (62,132) (48,364)
Effect of exchange rates on cash 1,479 1,104
------------ ------------
Net change in cash and cash
equivalents 40,961 (12,602)
Cash and cash equivalents, beginning of
period 338,885 348,592
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Cash and cash equivalents, end of period $ 379,846 $ 335,990
============ ============
As of March 31
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2008 2007
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Operational Data:
Employees 7,505 6,834
Branches 220 214
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.