 | C.H. Robinson 14701 Charlson Rd. Eden Prairie, MN 55347 www.chrobinson.com |
FOR INQUIRIES, CONTACT: Robert Houghton, VP of Investor Relations and Treasury | |
FOR IMMEDIATE RELEASE
C.H. Robinson Reports 2019 Third Quarter Results
MINNEAPOLIS, MN, October 29, 2019 - C.H. Robinson Worldwide, Inc. (“C.H. Robinson”) (Nasdaq: CHRW) today reported financial results for the quarter ended September 30, 2019.
• | Net revenues decreased 8.7 percent to $633.4 million |
• | Income from operations decreased 18.2 percent to $201.1 million |
• | Operating margin decreased 370 basis points to 31.7 percent |
• | Diluted earnings per share (EPS) decreased 14.4 percent to $1.07 |
• | Cash flow from operations decreased 24.1 percent to $167.3 million |
“The third quarter provided challenges in both our North American Surface Transportation and Global Forwarding segments. Our net revenues, operating income, and EPS results finished below our long-term expectations. We anticipated an aggressive industry pricing environment coming into the second half of this year driven by excess capacity and softening demand and knew we faced difficult comparisons versus our strong double-digit net revenue growth in the second half of last year. Our results were negatively impacted by truckload margin compression in North America,” said Bob Biesterfeld, Chief Executive Officer of C.H. Robinson.
Biesterfeld continued, “A part of our customer value proposition, particularly in our committed relationships, is managing through freight cycles and the pricing volatility that occurs as a result of the cyclicality of our industry. Our people did a great job of controlling what we can control, which includes winning increased awards in contractual bids with our largest customers in the quarter and continuing to provide excellent service and innovation. We are also continuing to adjust our pricing strategies in order to optimize our results.”
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Third Quarter Results Summary
• | Total revenues decreased 10.2 percent to $3.9 billion, driven by lower pricing across most transportation service lines. |
• | Net revenues decreased 8.7 percent to $633.4 million, primarily driven by reduced margin in truckload services. |
• | Operating expenses decreased 3.5 percent to $432.3 million. Personnel expenses decreased 4.4 percent to $320.6 million, driven primarily by declines in performance-based compensation, partially offset by a 3.2 percent increase in average headcount. Selling, general and administrative (“SG&A”) expenses decreased 0.9 percent to $111.8 million, due primarily to a decrease in bad debt expense and a $5.8 million gain on the sale of an office building in Chicago, Illinois, partially offset by an increase in purchased services. |
• | Income from operations totaled $201.1 million, down 18.2 percent from last year due to a decline in North American Surface Transportation (“NAST”), partially offset by growth in Global Forwarding and All Other and Corporate. Operating margin of 31.7 percent declined 370 basis points. |
• | Interest and other expenses totaled $13.2 million, which primarily consists of interest expense. The third quarter also included a $1.1 million unfavorable impact from currency revaluation. |
• | The effective tax rate in the quarter was 21.8 percent compared to 26.5 percent last year. The lower effective tax rate was due primarily to a favorable adjustment of $2.7 million from a prior year tax provision. |
• | Net income totaled $146.9 million, down 16.5 percent from a year ago. Diluted EPS of $1.07 decreased 14.4 percent. |
Year-to-Date Results Summary
• | Total revenues decreased 7.8 percent to $11.5 billion, driven by declines across most transportation service lines. |
• | Net revenues increased 0.8 percent to $2.0 billion. |
• | Operating expenses increased 1.5 percent to $1.4 billion. Personnel expenses decreased 0.5 percent to $1.0 billion, driven primarily by declines in performance-based compensation, partially offset by a 2.6 percent increase in average headcount. SG&A expenses increased 7.3 percent to $354.7 million, due primarily to increases in purchased services, particularly commercial off-the-shelf software, and occupancy, partially offset by a reduction in bad debt expense. |
• | Income from operations totaled $653.2 million, down 0.5 percent from last year due to a decline in All Other and Corporate, partially offset by growth in Global Forwarding. Operating margin of 32.5 percent decreased 50 basis points. |
• | Interest and other expenses totaled $36.9 million, which primarily consists of interest expense. The nine-month period also included a $3.3 million unfavorable impact from currency revaluation. |
• | The effective tax rate for the first nine months was 22.5 percent compared to 24.7 percent in the year-ago period. |
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• | Net income totaled $477.9 million, up 0.1 percent from a year ago. Diluted EPS of $3.45 increased 1.8 percent. |
North American Surface Transportation Results
Summarized financial results of our NAST segment are as follows (dollars in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | % change | 2019 | 2018 | % change | |||||||||||||||||
Total revenues | $ | 2,826,308 | $ | 3,224,906 | (12.4 | )% | $ | 8,495,145 | $ | 9,296,510 | (8.6 | )% | ||||||||||
Net revenues | 433,760 | 499,463 | (13.2 | )% | 1,406,728 | 1,397,571 | 0.7 | % | ||||||||||||||
Income from operations | 176,200 | 223,893 | (21.3 | )% | 592,215 | 591,774 | 0.1 | % | ||||||||||||||
Third quarter total revenues for C.H. Robinson's NAST segment totaled $2.8 billion, a decrease of 12.4 percent over the prior year, primarily driven by decreased pricing. NAST net revenues decreased 13.2 percent in the quarter to $433.8 million. Net revenues in truckload decreased 17.4 percent, less than truckload (“LTL”) net revenues increased 1.3 percent, and intermodal net revenues decreased 15.9 percent versus the year-ago period. Excluding the impact of the change in fuel prices, average North America truckload rate per mile charged to customers decreased approximately 12.5 percent in the quarter, while truckload transportation cost per mile decreased approximately 12 percent. Truckload volumes declined 4 percent in the quarter, as low-single-digit growth in contractual volume was not enough to offset the significant declines in spot market opportunities in the current environment. LTL volumes grew 4 percent, and intermodal volumes declined 24 percent versus the prior year. Operating expenses decreased 6.5 percent due to decreased personnel expenses, partially offset by increased SG&A expenses. Income from operations decreased 21.3 percent to $176.2 million, and operating margin declined 420 basis points to 40.6 percent. NAST average headcount was down 0.1 percent in the quarter. As a reminder, third quarter and year-to-date NAST results include Robinson Fresh transportation, which was previously reported under the Robinson Fresh segment.
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Global Forwarding Results
Summarized financial results of our Global Forwarding segment are as follows (dollars in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | % change | 2019 | 2018 | % change | |||||||||||||||||
Total revenues | $ | 597,695 | $ | 639,268 | (6.5 | )% | $ | 1,727,745 | $ | 1,810,619 | (4.6 | )% | ||||||||||
Net revenues | 135,815 | 134,101 | 1.3 | % | 404,987 | 401,169 | 1.0 | % | ||||||||||||||
Income from operations | 24,676 | 23,835 | 3.5 | % | 65,497 | 61,844 | 5.9 | % | ||||||||||||||
Third quarter total revenues for the Global Forwarding segment decreased 6.5 percent to $597.7 million, primarily driven by lower pricing in ocean and air and a decline in air volume. Net revenues increased 1.3 percent in the quarter to $135.8 million, with the acquisition of The Space Cargo Group (“Space Cargo”) contributing 3.5 percentage points of growth in the quarter. Ocean net revenues increased 4.1 percent driven by margin expansion. Net revenues in air decreased 7.2 percent driven by declines in pricing and shipments. Customs net revenues increased 1.8 percent, primarily driven by increased transaction volume. Operating expenses increased 0.8 percent, driven by increased investments in technology. Third quarter average headcount increased 2.3 percent, with Space Cargo contributing 3.5 percentage points to the growth. Income from operations increased 3.5 percent to $24.7 million, and operating margin expanded 40 basis points to 18.2 percent in the quarter.
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All Other and Corporate Results
Net revenues for Robinson Fresh, Managed Services and Other Surface Transportation are summarized as follows (dollars in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
Net revenues | 2019 | 2018 | % change | 2019 | 2018 | % change | ||||||||||||||||
Robinson Fresh | $ | 26,382 | $ | 26,399 | (0.1 | )% | $ | 86,276 | $ | 89,280 | (3.4 | )% | ||||||||||
Managed Services | 21,574 | 20,080 | 7.4 | % | 61,985 | 58,471 | 6.0 | % | ||||||||||||||
Other Surface Transportation | 15,900 | 14,001 | 13.6 | % | 47,471 | 44,961 | 5.6 | % | ||||||||||||||
Third quarter Robinson Fresh net revenues decreased 0.1 percent to $26.4 million. Managed Services net revenues increased 7.4 percent this quarter. Other Surface Transportation net revenues increased 13.6 percent to $15.9 million, with the acquisition of Dema Service contributing 13 percentage points of net revenue growth. All Other and Corporate operating income included a $5.8 million gain on the sale of an office building in Chicago, Illinois.
Other Income Statement Items
The third quarter effective tax rate was 21.8 percent, down from 26.5 percent last year. The lower effective tax rate was due primarily to a favorable adjustment of $2.7 million from a prior year tax provision. We now expect our 2019 full-year effective tax rate to be in the range of 23 to 24 percent.
Interest and other expenses totaled $13.2 million, which primarily consists of interest expense. Interest expense declined in the quarter driven by a reduction in our overall debt balance. The third quarter also included a $1.1 million unfavorable impact from currency revaluation.
Diluted weighted average shares outstanding in the quarter were down 1.9 percent due primarily to $67.0 million in share repurchases.
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Cash Flow Generation and Capital Distribution
Cash from operations totaled $167.3 million, down 24.1 percent versus the prior year, primarily due to decreased earnings versus the year-ago period.
In the third quarter, $135.9 million was returned to shareholders, with $68.9 million in cash dividends and $67.0 million in share repurchases. This represents a decrease of 9.9 percent over the prior year.
Capital expenditures totaled $19.4 million in the quarter. We now expect 2019 capital expenditures to be between $65 and $75 million, with the majority dedicated to technology.
Outlook
“Looking ahead, we expect that North American routing guides will continue to reset at lower prices in response to the falling cost environment and decline in spot market freight opportunities. While industry data suggests capacity continues to exit the North America truckload market, we believe capacity will exceed available shipments for the next few quarters,” Biesterfeld stated. “Despite the current freight environment, our long-term goals remain unchanged. We remain focused on taking market share, automating core processes while delivering industry-leading quality service to our customers and carriers, and improving operating leverage in our businesses.”
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About C.H. Robinson
C.H. Robinson solves logistics problems for companies across the globe and across industries, from the simple to the most complex. With over $20 billion in freight under management and 18 million shipments annually, we are the world’s largest logistics platform. Our global suite of services accelerates trade to seamlessly deliver the products and goods that drive the world’s economy. With the combination of our multimodal transportation management system and expertise, we use our information advantage to deliver smarter solutions for our more than 124,000 customers and 76,000 contract carriers. Our technology is built by and for supply chain experts to bring faster, more meaningful improvements to our customers’ businesses. As a responsible global citizen, we are also proud to contribute millions of dollars to support causes that matter to our company, our Foundation and our employees. For more information, visit us at www.chrobinson.com (Nasdaq: CHRW).
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 such 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; changes in relationships with existing contracted truck, rail, ocean, and air carriers; changes in our customer base due to possible consolidation among our customers; our ability to successfully integrate the operations of acquired companies with our historic operations; risks associated with litigation, including contingent auto liability and insurance coverage; risks associated with operations outside of the United States; risks associated with the potential impact of changes in government regulations; risks associated with the produce industry, including food safety and contamination issues; fuel price increases or decreases, or fuel shortages; cyber-security related risks; the impact of war on the economy; changes to our capital structure; risks related to the elimination of LIBOR; 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 Third Quarter 2019 Earnings Conference Call
Wednesday, October 30, 2019; 8:30 a.m. Eastern Time
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: 877-269-7756
International callers dial +1-201-689-7817
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 adrienne.brausen@chrobinson.com.
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Summarized Financial Results
($ in thousands, except per share data)
This table of summary results presents our service line net revenues consistent with our historical presentation and is on an enterprise basis. The service line net revenues in the table differ from the service line net revenues discussed within the segments as our segments have revenues from multiple service lines.
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
2019 | 2018 | % change | 2019 | 2018 | % change | |||||||||||||||||
Total revenues | $ | 3,856,132 | $ | 4,291,900 | (10.2 | )% | $ | 11,516,182 | $ | 12,493,264 | (7.8 | )% | ||||||||||
Net revenues: | ||||||||||||||||||||||
Transportation | ||||||||||||||||||||||
Truckload | $ | 317,990 | $ | 378,572 | (16.0 | )% | $ | 1,067,334 | $ | 1,050,305 | 1.6 | % | ||||||||||
LTL | 124,523 | 122,616 | 1.6 | % | 363,743 | 353,949 | 2.8 | % | ||||||||||||||
Intermodal | 7,110 | 8,361 | (15.0 | )% | 19,484 | 23,874 | (18.4 | )% | ||||||||||||||
Ocean | 77,879 | 74,839 | 4.1 | % | 234,884 | 230,718 | 1.8 | % | ||||||||||||||
Air | 27,121 | 29,991 | (9.6 | )% | 80,837 | 89,779 | (10.0 | )% | ||||||||||||||
Customs | 23,719 | 23,305 | 1.8 | % | 68,903 | 64,754 | 6.4 | % | ||||||||||||||
Other logistics services | 30,025 | 31,188 | (3.7 | )% | 90,472 | 91,474 | (1.1 | )% | ||||||||||||||
Total transportation | 608,367 | 668,872 | (9.0 | )% | 1,925,657 | 1,904,853 | 1.1 | % | ||||||||||||||
Sourcing | 25,064 | 25,172 | (0.4 | )% | 81,790 | 86,599 | (5.6 | )% | ||||||||||||||
Total net revenues | 633,431 | 694,044 | (8.7 | )% | 2,007,447 | 1,991,452 | 0.8 | % | ||||||||||||||
Operating expenses | 432,346 | 448,071 | (3.5 | )% | 1,354,277 | 1,334,886 | 1.5 | % | ||||||||||||||
Income from operations | 201,085 | 245,973 | (18.2 | )% | 653,170 | 656,566 | (0.5 | )% | ||||||||||||||
Net income | $ | 146,894 | $ | 175,895 | (16.5 | )% | $ | 477,862 | $ | 477,355 | 0.1 | % | ||||||||||
Diluted EPS | $ | 1.07 | $ | 1.25 | (14.4 | )% | $ | 3.45 | $ | 3.39 | 1.8 | % | ||||||||||
Our total revenues represent the total dollar value of services and goods we sell to our customers. Net revenues are a non-GAAP financial measure calculated as total revenues less the cost of purchased transportation and related services and the cost of purchased products sourced for resale. We believe net revenues are a useful measure of our ability to source, add value, and sell services and products that are provided by third parties, and we consider net revenues to be our primary performance measurement. Accordingly, the discussion of our results of operations often focuses on the changes in our net revenues. The reconciliation of total revenues to net revenues is presented below (in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues: | |||||||||||||||
Transportation | $ | 3,608,346 | $ | 4,028,392 | $ | 10,751,890 | $ | 11,619,171 | |||||||
Sourcing | 247,786 | 263,508 | 764,292 | 874,093 | |||||||||||
Total revenues | 3,856,132 | 4,291,900 | 11,516,182 | 12,493,264 | |||||||||||
Costs and expenses: | |||||||||||||||
Purchased transportation and related services | 2,999,979 | 3,359,520 | 8,826,233 | 9,714,318 | |||||||||||
Purchased products sourced for resale | 222,722 | 238,336 | 682,502 | 787,494 | |||||||||||
Total costs and expenses | 3,222,701 | 3,597,856 | 9,508,735 | 10,501,812 | |||||||||||
Net revenues | $ | 633,431 | $ | 694,044 | $ | 2,007,447 | $ | 1,991,452 | |||||||
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Condensed Consolidated Statements of Income
(unaudited, in thousands, except per share data)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Transportation | $ | 3,608,346 | $ | 4,028,392 | $ | 10,751,890 | $ | 11,619,171 | ||||||||
Sourcing | 247,786 | 263,508 | 764,292 | 874,093 | ||||||||||||
Total revenues | 3,856,132 | 4,291,900 | 11,516,182 | 12,493,264 | ||||||||||||
Costs and expenses: | ||||||||||||||||
Purchased transportation and related services | 2,999,979 | 3,359,520 | 8,826,233 | 9,714,318 | ||||||||||||
Purchased products sourced for resale | 222,722 | 238,336 | 682,502 | 787,494 | ||||||||||||
Personnel expenses | 320,563 | 335,299 | 999,547 | 1,004,226 | ||||||||||||
Other selling, general, and administrative expenses | 111,783 | 112,772 | 354,730 | 330,660 | ||||||||||||
Total costs and expenses | 3,655,047 | 4,045,927 | 10,863,012 | 11,836,698 | ||||||||||||
Income from operations | 201,085 | 245,973 | 653,170 | 656,566 | ||||||||||||
Interest and other expense | (13,180 | ) | (6,526 | ) | (36,935 | ) | (22,354 | ) | ||||||||
Income before provision for income taxes | 187,905 | 239,447 | 616,235 | 634,212 | ||||||||||||
Provisions for income taxes | 41,011 | 63,552 | 138,373 | 156,857 | ||||||||||||
Net income | $ | 146,894 | $ | 175,895 | $ | 477,862 | $ | 477,355 | ||||||||
Net income per share (basic) | $ | 1.08 | $ | 1.27 | $ | 3.48 | $ | 3.42 | ||||||||
Net income per share (diluted) | $ | 1.07 | $ | 1.25 | $ | 3.45 | $ | 3.39 | ||||||||
Weighted average shares outstanding (basic) | 136,380 | 138,797 | 137,274 | 139,425 | ||||||||||||
Weighted average shares outstanding (diluted) | 137,476 | 140,160 | 138,373 | 140,720 | ||||||||||||
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Business Segment Information
(unaudited, dollars in thousands)
NAST | Global Forwarding | All Other and Corporate | Consolidated | |||||||||||||
Three Months Ended September 30, 2019 | ||||||||||||||||
Total revenues | $ | 2,826,308 | $ | 597,695 | $ | 432,129 | $ | 3,856,132 | ||||||||
Net revenues | 433,760 | 135,815 | 63,856 | 633,431 | ||||||||||||
Income from operations | 176,200 | 24,676 | 209 | 201,085 | ||||||||||||
Depreciation and amortization | 5,734 | 9,186 | 10,560 | 25,480 | ||||||||||||
Total assets (1) | 2,649,259 | 995,137 | 992,153 | 4,636,549 | ||||||||||||
Average headcount | 7,448 | 4,790 | 3,544 | 15,782 | ||||||||||||
NAST | Global Forwarding | All Other and Corporate | Consolidated | |||||||||||||
Three Months Ended September 30, 2018 (2) | ||||||||||||||||
Total revenues | $ | 3,224,906 | $ | 639,268 | $ | 427,726 | $ | 4,291,900 | ||||||||
Net revenues | 499,463 | 134,101 | 60,480 | 694,044 | ||||||||||||
Income (loss) from operations | 223,893 | 23,835 | (1,755 | ) | 245,973 | |||||||||||
Depreciation and amortization | 6,286 | 8,735 | 8,902 | 23,923 | ||||||||||||
Total assets (1) | 2,739,569 | 944,928 | 808,225 | 4,492,722 | ||||||||||||
Average headcount | 7,454 | 4,684 | 3,153 | 15,291 | ||||||||||||
____________________________________________
(1) All cash and cash equivalents are included in All Other and Corporate.
(2) Amounts have been reclassified to reflect the segment reorganization announced in the first quarter of 2019.
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Business Segment Information
(unaudited, dollars in thousands)
NAST | Global Forwarding | All Other and Corporate | Consolidated | |||||||||||||
Nine Months Ended September 30, 2019 | ||||||||||||||||
Total revenues | $ | 8,495,145 | $ | 1,727,745 | $ | 1,293,292 | $ | 11,516,182 | ||||||||
Net revenues | 1,406,728 | 404,987 | 195,732 | 2,007,447 | ||||||||||||
Income (loss) from operations | 592,215 | 65,497 | (4,542 | ) | 653,170 | |||||||||||
Depreciation and amortization | 18,124 | 27,427 | 29,571 | 75,122 | ||||||||||||
Total assets (1) | 2,649,259 | 995,137 | 992,153 | 4,636,549 | ||||||||||||
Average headcount | 7,436 | 4,748 | 3,398 | 15,582 | ||||||||||||
NAST | Global Forwarding | All Other and Corporate | Consolidated | |||||||||||||
Nine Months Ended September 30, 2018 (2) | ||||||||||||||||
Total revenues | $ | 9,296,510 | $ | 1,810,619 | $ | 1,386,135 | $ | 12,493,264 | ||||||||
Net revenues | 1,397,571 | 401,169 | 192,712 | 1,991,452 | ||||||||||||
Income from operations | 591,774 | 61,844 | 2,948 | 656,566 | ||||||||||||
Depreciation and amortization | 18,905 | 26,397 | 27,100 | 72,402 | ||||||||||||
Total assets (1) | 2,739,569 | 944,928 | 808,225 | 4,492,722 | ||||||||||||
Average headcount | 7,375 | 4,725 | 3,089 | 15,189 | ||||||||||||
____________________________________________
(1) All cash and cash equivalents are included in All Other and Corporate.
(2) Amounts have been reclassified to reflect the segment reorganization announced in the first quarter of 2019.
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Condensed Consolidated Balance Sheets
(unaudited, in thousands)
September 30, 2019 | December 31, 2018 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 384,424 | $ | 378,615 | |||
Receivables, net of allowance for doubtful accounts | 2,074,449 | 2,162,438 | |||||
Contract assets | 150,569 | 159,635 | |||||
Prepaid expenses and other | 73,724 | 52,386 | |||||
Total current assets | 2,683,166 | 2,753,074 | |||||
Property and equipment, net | 209,521 | 228,301 | |||||
Right-of-use lease assets | 263,833 | — | |||||
Intangible and other assets | 1,480,029 | 1,446,037 | |||||
Total assets | $ | 4,636,549 | $ | 4,427,412 | |||
Liabilities and stockholders’ investment | |||||||
Current liabilities: | |||||||
Accounts payable and outstanding checks | $ | 1,076,597 | $ | 1,063,107 | |||
Accrued expenses: | |||||||
Compensation | 107,659 | 153,626 | |||||
Transportation expense | 114,498 | 119,820 | |||||
Income taxes | 19,470 | 28,360 | |||||
Other accrued liabilities | 60,069 | 63,410 | |||||
Current lease liabilities | 55,847 | — | |||||
Current portion of debt | — | 5,000 | |||||
Total current liabilities | 1,434,140 | 1,433,323 | |||||
Long-term debt | 1,253,091 | 1,341,352 | |||||
Noncurrent lease liabilities | 216,610 | — | |||||
Noncurrent income taxes payable | 22,149 | 21,463 | |||||
Deferred tax liability | 37,206 | 35,757 | |||||
Other long-term liabilities | 257 | 430 | |||||
Total liabilities | 2,963,453 | 2,832,325 | |||||
Total stockholders’ investment | 1,673,096 | 1,595,087 | |||||
Total liabilities and stockholders’ investment | $ | 4,636,549 | $ | 4,427,412 | |||
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Condensed Consolidated Statements of Cash Flow
(unaudited, in thousands, except operational data)
Nine Months Ended September 30, | |||||||
2019 | 2018 | ||||||
Operating activities: | |||||||
Net income | $ | 477,862 | $ | 477,355 | |||
Depreciation and amortization | 75,122 | 72,402 | |||||
Provision for doubtful accounts | 642 | 12,333 | |||||
Stock-based compensation | 40,657 | 68,475 | |||||
Deferred income taxes | (3,360 | ) | (5,794 | ) | |||
Excess tax benefit on stock-based compensation | (6,908 | ) | (9,345 | ) | |||
Other operating activities | (4,471 | ) | 1,350 | ||||
Changes in operating elements, net of acquisitions: | |||||||
Receivables | 104,108 | (268,252 | ) | ||||
Contract assets | 9,067 | (53,647 | ) | ||||
Prepaid expenses and other | (18,940 | ) | 14,740 | ||||
Accounts payable and outstanding checks | 3,871 | 120,652 | |||||
Accrued compensation | (45,319 | ) | 15,153 | ||||
Accrued transportation expenses | (5,323 | ) | 62,165 | ||||
Accrued income taxes | (7,042 | ) | 9,247 | ||||
Other accrued liabilities | 5,210 | 9,944 | |||||
Other assets and liabilities | (1,318 | ) | 2,105 | ||||
Net cash provided by operating activities | 623,858 | 528,883 | |||||
Investing activities: | |||||||
Purchases of property and equipment | (26,661 | ) | (35,794 | ) | |||
Purchases and development of software | (24,282 | ) | (13,793 | ) | |||
Acquisitions, net of cash acquired | (59,188 | ) | (1,315 | ) | |||
Other investing activities | 16,625 | (1,605 | ) | ||||
Net cash used for investing activities | (93,506 | ) | (52,507 | ) | |||
Financing activities: | |||||||
Proceeds from stock issued for employee benefit plans | 40,442 | 46,424 | |||||
Net repurchases of common stock | (255,655 | ) | (222,697 | ) | |||
Cash dividends | (207,865 | ) | (195,158 | ) | |||
Proceeds from long-term borrowings | 929,000 | 591,012 | |||||
Payments on long-term borrowings | (1,018,000 | ) | — | ||||
Proceeds from short-term borrowings | 14,000 | 2,588,000 | |||||
Payments on short-term borrowings | (19,000 | ) | (3,303,000 | ) | |||
Net cash used for financing activities | (517,078 | ) | (495,419 | ) | |||
Effect of exchange rates on cash | (7,465 | ) | (17,046 | ) | |||
Net change in cash and cash equivalents | 5,809 | (36,089 | ) | ||||
Cash and cash equivalents, beginning of period | 378,615 | 333,890 | |||||
Cash and cash equivalents, end of period | $ | 384,424 | $ | 297,801 | |||
As of September 30, | |||||||
Operational Data: | 2019 | 2018 | |||||
Employees | 15,654 | 15,225 | |||||
Source: C.H. Robinson
CHRW-IR
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