EX-99.1 2 rrd289262_33178.htm PRESS RELEASE OF C.H. ROBINSON WORDWIDE, INC. DATED OCTOBER 26, 2010 C

 

 

C.H. Robinson Worldwide, Inc.

14701 Charlson Road

Eden Prairie, Minnesota 55347

Chad Lindbloom, senior vice president and chief financial officer (952) 937-7779

Angie Freeman, vice president, investor relations and public affairs (952) 937-7847

FOR IMMEDIATE RELEASE

C.H. ROBINSON REPORTS THIRD QUARTER RESULTS

MINNEAPOLIS, October 26, 2010 - C.H. Robinson Worldwide, Inc. ("C.H. Robinson") (NASDAQ: CHRW), today reported financial results for the quarter ended September 30, 2010.

Summarized financial results for the quarter ended September 30 are as follows (dollars in thousands, except per share data):

Three months ended September 30,

Nine months ended September 30,

2010

2009

%

change

2010

2009

% change

Total revenues

$ 2,420,357

$1,954,803

23.8%

$6,948,956

$ 5,568,823

24.8%

Net revenues:

Transportation

Truck

$ 284,200

$ 268,055

6.0%

$ 785,782

$ 790,640

-0.6%

Intermodal

9,188

8,350

10.0%

27,109

26,608

1.9%

Ocean

17,057

13,404

27.3%

44,049

40,578

8.6%

Air

11,453

8,309

37.8%

31,559

23,394

34.9%

Other logistics services

14,666

11,714

25.2%

42,857

32,529

31.8%

Total transportation

336,564

309,832

8.6%

931,356

913,749

1.9%

Sourcing

31,921

30,860

3.4%

107,673

95,447

12.8%

Information services

14,095

11,874

18.7%

40,785

33,647

21.2%

Total net revenues

382,580

352,566

8.5%

1,079,814

1,042,873

3.5%

Operating expenses

216,247

197,765

9.3%

621,019

600,820

3.4%

Operating income

166,333

154,801

7.4%

458,795

442,053

3.8%

Net income

$ 102,627

$ 95,460

7.5%

$ 283,865

$ 273,096

3.9%

Diluted EPS

$ 0.62

$ 0.57

8.8%

$ 1.71

$ 1.61

6.2%

Our Transportation revenue increased 29.6 percent in the third quarter of 2010. Transportation net revenues increased 8.6 percent to $336.6 million in the third quarter of 2010 from $309.8 million in the third quarter of 2009. Our Transportation net revenue margin decreased to 16.6 percent in 2010 from 19.8 percent in 2009.

Our truck net revenues, which consist of truckload and less-than-truckload ("LTL") services, increased 6.0 percent in the third quarter of 2010. Our truckload volumes increased approximately 14 percent in the third quarter of 2010 compared to the third quarter of 2009. Our truckload net revenue margins decreased due to higher transportation costs and higher fuel prices, partially offset by increased pricing to our customers. Excluding the estimated impacts of the change in fuel, our truckload pricing to our customers increased approximately eight percent in the third quarter of 2010 compared to the third quarter of 2009. Our truckload transportation costs increased approximately 12 percent, excluding the estimated impacts of fuel. Our LTL net revenues increased approximately 18 percent. The increase was driven by an increase in total shipments of approximately 17 percent and increased pricing, partially offset by a small decline in our net revenue margin.

Our intermodal net revenue increase of 10.0 percent in the third quarter of 2010 was driven by increased volume.

Our ocean transportation net revenues increased 27.3 percent in the third quarter of 2010, driven by large volume increases. We experienced a net revenue margin decline due to increased cost of capacity, which was partially offset by increased pricing to our customers.

Our air transportation net revenue increased 37.8 percent in the third quarter of 2010 due to higher volumes.

Other logistics services net revenues consist primarily of transportation management fees and customs brokerage fees. The increase of 25.2 percent was driven primarily by an increase in management fees.

For the third quarter, our Sourcing revenues increased 0.1 percent, including the previously announced acquisition of Rosemont Farms, Inc. ("Rosemont") on September 15, 2009. Sourcing net revenues increased 3.4 percent to $31.9 million in 2010 from $30.9 million in 2009. Excluding the Rosemont acquisition, Sourcing net revenues decreased approximately 11 percent in the third quarter of 2010, primarily due to decreased volumes with a large customer.

Our Information Services revenues increased 18.7 percent in the third quarter of 2010 due to an increase in transactions and increases in some fees that are impacted by fuel prices.

For the third quarter, operating expenses increased 9.3 percent to $216.2 million in 2010 from $197.8 million in 2009. This was due to an increase of 8.9 percent in personnel expense and an increase of 10.8 percent in other selling, general, and administrative expenses. Personnel expenses related to our restricted stock program and various other incentive plans increased as many are variable, based on growth in our earnings.  We also increased average headcount by three percent in the quarter. A significant portion of the increase in our other selling, general, and administrative expenses was related to our acquisition of Rosemont. As a percentage of net revenues, total operating expenses increased slightly to 56.3 percent in the third quarter of 2010 from 56.1 percent in the third quarter of 2009.

 

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 35,000 customers through a network of 232 offices in North America, South America, Europe, Asia, Australia, and the Middle East. C.H. Robinson maintains one of the largest networks of motor carrier capacity in North America and works with over 47,000 transportation providers 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 changes in economic conditions such as the strength of the current recovery and 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, 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 potential impacts of changes in government regulations; risks associated with the produce industry, including food safety and contamination issues; fuel prices and availability; 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 Third Quarter 2010 Earnings Conference Call

Tuesday, October 26, 2010 5:00 pm. Eastern time

Live webcast available through Investor Relations link at www.chrobinson.com

Telephone access: 877-941-6011; conference ID 4371919

Webcast replay available through Investor Relations link at www.chrobinson.com

Telephone audio replay available until 12:59 a.m. Eastern Time on October 29, 2010: 800-406-7325;

passcode: 4371919#

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited, in thousands, except per share data)

Three months ended

September 30,

Nine months ended

September 30,

2010

2009

2010

2009

Revenues:

Transportation

$2,026,154

$ 1,563,335

$ 5,629,334

$ 4,369,438

Sourcing

380,108

379,594

1,278,837

1,165,738

Information Services

14,095

11,874

40,785

33,647

Total revenues

2,420,357

1,954,803

6,948,956

5,568,823

Costs and expenses:

Purchased transportation and related services

1,689,590

1,253,503

4,697,978

3,455,689

Purchased products sourced for resale

348,187

348,734

1,171,164

1,070,261

Personnel expenses

161,947

148,750

462,793

453,716

Other selling, general, and administrative expenses

54,300

49,015

158,226

147,104

Total costs and expenses

2,254,024

1,800,002

6,490,161

5,126,770

Income from operations

166,333

154,801

458,795

442,053

Investment and other income

149

439

986

1,658

Income before provision for income taxes

166,482

155,240

459,781

443,711

Provision for income taxes

63,855

59,780

175,916

170,615

Net income

$ 102,627

$ 95,460

$ 283,865

$ 273,096

Net income per share (basic)

$ 0.62

$ 0.57

$ 1.72

$ 1.62

Net income per share (diluted)

$ 0.62

$ 0.57

$ 1.71

$ 1.61

Weighted average shares outstanding (basic)

164,691

167,191

164,968

168,168

Weighted average shares outstanding (diluted)

165,576

168,648

165,985

169,746

 

 

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands)

September 30,

2010

December 31,

2009

Assets

Current assets:

Cash and cash equivalents

$ 249,433

$ 337,308

Available-for-sale securities

34,123

48,310

Receivables, net

1,142,457

885,543

Other current assets

40,927

36,108

Total current assets

1,466,940

1,307,269

Property and equipment, net

116,259

117,699

Intangible and other assets

398,885

409,280

Total Assets

$ 1,982,084

$ 1,834,248

Liabilities and stockholders' investment

Current liabilities:

Accounts payable and outstanding checks

$ 670,910

$ 606,514

Accrued compensation

77,092

90,855

Other accrued expenses

41,483

34,438

Total current liabilities

789,485

731,807

Long term liabilities

22,019

22,541

Total liabilities

811,504

754,348

Total stockholders' investment

1,170,580

1,079,900

Total liabilities and stockholders' investment

$ 1,982,084

$ 1,834,248

 

 

 

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited, in thousands, except operational data)

Nine months ended

September 30,

2010

2009

Operating activities:

Net income

$ 283,865

$ 273,096

Stock-based compensation

22,568

17,187

Depreciation and amortization

22,113

22,195

Provision for doubtful accounts

11,442

13,626

Other non-cash expenses, net

10,782

(2,238)

Net changes in operating elements

(213,634)

(81,495)

Net cash provided by operating activities

137,136

242,371

Investing activities:

Net property additions

(14,000)

(26,120)

Purchases and development of software

(7,715)

(2,873)

Purchases of available-for-sale securities

(10,752)

(11,915)

Sales/maturities of available-for-sale securities

28,230

2,763

Cash paid for acquisition, net

-

(43,537)

Restricted cash

(5,000)

-

Other investing activities

(12)

213

Net cash used for investing activities

(9,249)

(81,469)

Financing activities:

Net repurchases of common stock

(96,822)

(162,723)

Excess tax benefit from stock-based compensation plans

9,497

8,052

Cash dividends

(126,709)

(122,023)

Net cash used for financing activities

(214,034)

(276,694)

Effect of exchange rates on cash

(1,728)

(2,677)

Net change in cash and cash equivalents

(87,875)

(118,469)

Cash and cash equivalents, beginning of period

337,308

494,743

Cash and cash equivalents, end of period

$ 249,433

$ 376,274

As of September 30,

2010

2009

Operational Data:

Employees

7,589

7,370

Branches

232

235

 

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