UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report:
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) |
(Commission File No.) |
(IRS Employer Identification Number) |
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(Address of principal executive offices) |
(Registrant's telephone number, including area code) |
(Zip Code) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Name of each exchange on which registered |
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On November 3, 2020, Expeditors International of Washington, Inc., a Washington corporation, issued a press release announcing third quarter 2020 financial results. A copy of the press release is furnished as Exhibit 99.1 to this report.
In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing
Item 9.01 Financial Statements and Exhibits.
(d) |
The following items are filed as exhibits to this report: |
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Press release, dated November 3, 2020 issued by Expeditors International of Washington, Inc. |
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. |
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November 3, 2020 |
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/S/ Bradley S. Powell |
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Bradley S. Powell, Senior Vice President and Chief Financial Officer |
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Exhibit 99.1
EARNINGS RELEASE
By: |
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Expeditors International of Washington, Inc. |
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1015 Third Avenue |
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Seattle, Washington 98104 |
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CONTACTS: |
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Jeffrey S. Musser |
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Bradley S. Powell |
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Geoffrey Buscher |
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President and Chief Executive Officer |
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Senior Vice President and Chief Financial Officer |
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Director - Investor Relations |
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(206) 674-3433 |
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(206) 674-3412 |
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(206) 892-4510 |
FOR IMMEDIATE RELEASE
EXPEDITORS REPORTS THIRD QUARTER 2020 EPS OF $1.12
SEATTLE, WASHINGTON - November 3, 2020, Expeditors International of Washington, Inc. (NASDAQ:EXPD) today announced third quarter 2020 financial results including the following highlights compared to the same quarter of 2019:
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Diluted Net Earnings Attributable to Shareholders per share (EPS1) increased 22% to $1.12 |
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Net Earnings Attributable to Shareholders increased 19% to $191 million |
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Operating Income increased 22% to $252 million |
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Revenues increased 19% to $2.5 billion |
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Airfreight tonnage volume and ocean container volume both decreased 5% |
“Volumes started to recover across most of our products during the quarter, even as the global effects of COVID-19 continued to impact our business worldwide,” said Jeffrey S. Musser, President and Chief Executive Officer. “Similar to Q2, the pandemic caused an increase in demand for certain goods at the same time that air capacity remained tight due to travel restrictions and the limited schedule of domestic and international passenger flights. This caused continued imbalances between carrier capacity and demand, principally on exports out of North Asia, which was the only market in which air volumes increased during the third quarter. To meet the urgent transportation needs that could not be fulfilled with scheduled capacity, we utilized charter capacity for certain customers, resulting in higher average buy and sell rates. While airfreight buy and sell rates were generally lower in our third quarter than the extremes we experienced in the second quarter, they remained historically elevated and highly unpredictable due to ongoing supply/demand imbalances. We would expect air pricing to remain volatile until passenger traffic starts to return in a meaningful way.
“While our ocean freight business has not been nearly as impacted by supply constraints, carriers remain disciplined and are carefully managing capacity even as volumes have increased from the lows we saw earlier in this pandemic. Across most of our products in the third quarter, we experienced a steady recovery in demand as shippers adjusted to an altered marketplace and disrupted supply chains.
“Despite the challenges, we continue to serve our customers at the highest level throughout our organization, whether working from remote locations or on-site at one of our many warehouses, where we are following very strict safety protocols. Thanks to the ongoing implementation of our business continuity plans and the adaptability of our people, all of our offices remain open, connected, and are functioning extremely well. Our network is strong, and our people remain steadfast and highly flexible.”
Bradley S. Powell, Senior Vice President and Chief Financial Officer, added, “The effects of COVID-19 continued to impact volumes for all products, although not as significantly as in the prior sequential quarter. While we have experienced increased demand in many of our markets for a mix of products, capacity constraints in air, and to a lesser extent in ocean, have led to a continued buy/sell rate imbalance. While we remain uncertain about the pace, strength, or evenness of an economic recovery, we will continue to use our strong financial position to make important strategic investments that are necessary for our future growth, while continuing our focus on controlling costs and improving operational efficiencies. We appreciate the hard work of our District Managers and their leadership teams as they continue to execute at a high level, control operational expenses and limit the addition of headcount.”
Expeditors is a global logistics company headquartered in Seattle, Washington. The Company employs trained professionals in 176 district offices and numerous branch locations located on six continents linked into a seamless worldwide network through an integrated information management system. Services include the consolidation or forwarding of air and ocean freight, customs brokerage, vendor consolidation, cargo insurance, time-definite transportation, order management, warehousing and distribution and customized logistics solutions.
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1Diluted earnings attributable to shareholders per share.
NOTE: See Disclaimer on Forward-Looking Statements on the following page of this release.
Expeditors International of Washington, Inc.
Third Quarter 2020 Earnings Release, November 3, 2020
Financial Highlights for the three and nine months ended September 30, 2020 and 2019 (Unaudited)
(in 000's of US dollars except per share data)
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Three months ended September 30, |
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Nine months ended September 30, |
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2020 |
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2019 |
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% Change |
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2020 |
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2019 |
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% Change |
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Revenues |
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$ |
2,464,797 |
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$ |
2,074,855 |
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19% |
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$ |
6,947,293 |
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$ |
6,130,485 |
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13% |
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Directly related cost of transportation and other expenses1 |
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$ |
1,730,418 |
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$ |
1,400,499 |
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24% |
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$ |
4,848,187 |
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$ |
4,140,320 |
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17% |
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Salaries and other operating expenses2 |
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$ |
482,434 |
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$ |
467,806 |
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3% |
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$ |
1,440,480 |
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$ |
1,403,813 |
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3% |
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Operating income |
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$ |
251,945 |
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$ |
206,550 |
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22% |
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$ |
658,626 |
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$ |
586,352 |
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12% |
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Net earnings attributable to shareholders |
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$ |
191,307 |
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$ |
160,221 |
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19% |
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$ |
497,520 |
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$ |
453,069 |
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10% |
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Diluted earnings attributable to shareholders per share |
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$ |
1.12 |
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$ |
0.92 |
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22% |
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$ |
2.92 |
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$ |
2.60 |
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12% |
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Basic earnings attributable to shareholders per share |
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$ |
1.14 |
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$ |
0.94 |
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21% |
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$ |
2.96 |
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$ |
2.65 |
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12% |
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Diluted weighted average shares outstanding |
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170,735 |
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173,483 |
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170,539 |
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174,463 |
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Basic weighted average shares outstanding |
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168,310 |
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170,415 |
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167,942 |
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171,084 |
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1Directly related cost of transportation and other expenses totals Operating Expenses from Airfreight services, Ocean freight and ocean services and Customs brokerage and other services as shown in the Condensed Consolidated Statements of Earnings.
2Salaries and other operating expenses totals Salaries and related, Rent and occupancy, Depreciation and amortization, Selling and promotion and Other as shown in the Condensed Consolidated Statements of Earnings
During the three months ended September 30, 2020, we did not repurchase any shares of common stock and during the nine months ended September 30, 2020, we repurchased 4.4 million shares of common stock at an average price of $71.41 per share. During the three and nine months ended September 30, 2019, we repurchased 0.9 million and 4.1 million shares of common stock at an average price of $69.51 and $72.60 per share, respectively.
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Employee Full-time Equivalents as of September 30, |
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2020 |
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2019 |
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North America |
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6,666 |
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6,861 |
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Europe |
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3,361 |
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3,427 |
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North Asia |
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2,406 |
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2,483 |
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South Asia |
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1,643 |
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1,674 |
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Middle East, Africa and India |
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1,509 |
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1,565 |
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Latin America |
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800 |
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860 |
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Information Systems |
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975 |
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939 |
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Corporate |
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383 |
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383 |
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Total |
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17,743 |
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18,192 |
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Third quarter year-over-year percentage (decrease) increase in: |
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2020 |
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Airfreight kilos |
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Ocean freight FEU |
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July |
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(12)% |
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(13)% |
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August |
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(5)% |
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(5)% |
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September |
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2% |
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5% |
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Quarter |
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(5)% |
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(5)% |
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Investors may submit written questions via e-mail to: investor@expeditors.com. Questions received by the end of business on November 6, 2020 will be considered in management's 8-K “Responses to Selected Questions.”
Disclaimer on Forward-Looking Statements:
Certain statements contained in this news release are “forward-looking statements” that involve risks and uncertainties, including statements such as our expectations of continued volatility in air pricing. Actual results could differ materially because of factors such as: the timing until passenger traffic starts to return in a meaningful way; the impact on our ocean volumes; the pace, strength, or evenness of the of an economic recovery; our employees’ ability to continue to perform at a high level; airfreight buy and sell rates; our access to carrier capacity; our ability to keep our global offices open and operating; employee retention; employee health and safety; our ability to execute our business continuity plans; the strength of our financial position and our ability to continue to make investments in our strategic initiatives; our ability to remain a strong, healthy, unified and resilient organization; our ability to control costs and improve operational efficiencies; our ability to control operational expenses and limit the addition of headcount. The COVID-19 pandemic could have the effect of heightening many of the other risks described in Item 1A of our Annual Report on Form 10-K, including, without limitation, those related to the success of our strategy and desire to maintain historical unitary profitability, our ability to attract and retain customers, our ability to manage costs, interruptions to our information technology systems, the ability of third-party providers to perform and potential litigation as updated by our reports on Form 10-Q, filed with the Securities and Exchange Commission. These and other factors are discussed in the Company’s regulatory filings with the Securities and Exchange Commission, including those in “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and in “Item 1A. Risk Factors” of the Company’s most recent Quarterly Report on Form 10-Q. The forward-looking statements contained in this news release speak only as of this date, and the Company does not assume any obligation to update them except as required by law.
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)
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September 30, 2020 |
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December 31, 2019 |
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Assets: |
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Current Assets: |
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Cash and cash equivalents |
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$ |
1,465,510 |
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$ |
1,230,491 |
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Accounts receivable, less allowance for credit loss of $5,171 at September 30, 2020 and $11,143 at December 31, 2019 |
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1,582,424 |
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1,315,091 |
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Deferred contract costs |
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232,351 |
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131,783 |
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Other |
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129,617 |
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92,558 |
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Total current assets |
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3,409,902 |
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2,769,923 |
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Property and equipment, less accumulated depreciation and amortization of $510,103 at September 30, 2020 and $478,906 at December 31, 2019 |
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499,189 |
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499,344 |
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Operating lease right-of-use assets |
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422,002 |
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390,035 |
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Goodwill |
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7,927 |
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7,927 |
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Deferred federal and state income taxes, net |
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3,130 |
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8,034 |
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Other assets, net |
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16,404 |
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16,621 |
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Total assets |
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$ |
4,358,554 |
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$ |
3,691,884 |
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Liabilities: |
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Current Liabilities: |
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Accounts payable |
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$ |
888,761 |
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$ |
735,695 |
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Accrued expenses, primarily salaries and related costs |
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236,826 |
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189,446 |
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Contract liabilities |
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267,266 |
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154,183 |
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Current portion of operating lease liabilities |
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70,755 |
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65,367 |
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Federal, state and foreign income taxes |
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33,100 |
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23,627 |
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Total current liabilities |
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1,496,708 |
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1,168,318 |
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Noncurrent portion of operating lease liabilities |
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357,373 |
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326,347 |
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Commitments and contingencies |
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Shareholders’ Equity: |
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Preferred stock, none issued |
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— |
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— |
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Common stock, par value $0.01 per share. Issued and outstanding: 169,231 shares at September 30, 2020 and 169,622 shares at December 31, 2019 |
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1,692 |
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1,696 |
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Additional paid-in capital |
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145,924 |
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3,203 |
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Retained earnings |
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2,489,694 |
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2,321,316 |
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Accumulated other comprehensive loss |
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(135,281 |
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(131,187 |
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Total shareholders’ equity |
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2,502,029 |
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2,195,028 |
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Noncontrolling interest |
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2,444 |
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2,191 |
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Total equity |
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2,504,473 |
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2,197,219 |
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Total liabilities and equity |
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$ |
4,358,554 |
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$ |
3,691,884 |
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03-November-2020 |
Expeditors International of Washington, Inc. |
Page 3 of 7 |
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Earnings
(In thousands, except per share data)
(Unaudited)
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Three months ended September 30, |
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Nine months ended September 30, |
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2020 |
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2019 |
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2020 |
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2019 |
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Revenues: |
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Airfreight services |
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$ |
1,093,550 |
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$ |
715,450 |
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$ |
3,237,179 |
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$ |
2,171,928 |
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Ocean freight and ocean services |
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612,858 |
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585,374 |
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1,597,997 |
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1,697,824 |
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Customs brokerage and other services |
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758,389 |
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774,031 |
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2,112,117 |
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2,260,733 |
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Total revenues |
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2,464,797 |
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2,074,855 |
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6,947,293 |
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6,130,485 |
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Operating Expenses: |
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Airfreight services |
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833,689 |
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522,868 |
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2,450,931 |
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1,574,717 |
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Ocean freight and ocean services |
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455,072 |
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424,215 |
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1,185,154 |
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1,234,845 |
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Customs brokerage and other services |
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441,657 |
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453,416 |
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1,212,102 |
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1,330,758 |
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Salaries and related |
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373,613 |
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356,331 |
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1,110,760 |
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1,069,592 |
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Rent and occupancy |
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42,484 |
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41,987 |
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126,383 |
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124,407 |
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Depreciation and amortization |
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15,851 |
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12,386 |
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42,620 |
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38,456 |
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Selling and promotion |
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2,945 |
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10,133 |
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14,301 |
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32,852 |
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Other |
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47,541 |
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46,969 |
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146,416 |
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138,506 |
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Total operating expenses |
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2,212,852 |
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1,868,305 |
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6,288,667 |
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5,544,133 |
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Operating income |
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251,945 |
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206,550 |
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658,626 |
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586,352 |
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Other Income (Expense): |
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Interest income |
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1,504 |
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5,501 |
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8,870 |
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18,123 |
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Other, net |
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980 |
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1,895 |
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5,161 |
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5,822 |
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Other income, net |
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2,484 |
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7,396 |
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14,031 |
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23,945 |
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Earnings before income taxes |
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254,429 |
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213,946 |
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672,657 |
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610,297 |
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Income tax expense |
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62,710 |
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|
53,319 |
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|
|
173,968 |
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|
|
156,029 |
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Net earnings |
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191,719 |
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|
160,627 |
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|
498,689 |
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|
454,268 |
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Less net earnings attributable to the noncontrolling interest |
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|
412 |
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|
|
406 |
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|
|
1,169 |
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|
|
1,199 |
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Net earnings attributable to shareholders |
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$ |
191,307 |
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$ |
160,221 |
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$ |
497,520 |
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$ |
453,069 |
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Diluted earnings attributable to shareholders per share |
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$ |
1.12 |
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$ |
0.92 |
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|
$ |
2.92 |
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|
$ |
2.60 |
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Basic earnings attributable to shareholders per share |
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$ |
1.14 |
|
|
$ |
0.94 |
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|
$ |
2.96 |
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|
$ |
2.65 |
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Weighted average diluted shares outstanding |
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170,735 |
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173,483 |
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170,539 |
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174,463 |
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Weighted average basic shares outstanding |
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|
168,310 |
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|
|
170,415 |
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|
|
167,942 |
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|
171,084 |
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03-November-2020 |
Expeditors International of Washington, Inc. |
Page 4 of 7 |
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
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Three months ended September 30, |
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Nine months ended September 30, |
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2020 |
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2019 |
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2020 |
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2019 |
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Operating Activities: |
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|
|
|
|
|
|
|
|
|
Net earnings |
|
$ |
191,719 |
|
|
$ |
160,627 |
|
|
$ |
498,689 |
|
|
$ |
454,268 |
|
Adjustments to reconcile net earnings to net cash from operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions for losses on accounts receivable |
|
|
398 |
|
|
|
757 |
|
|
|
4,607 |
|
|
|
453 |
|
Deferred income tax (benefit) expense |
|
|
(1,276 |
) |
|
|
(5,822 |
) |
|
|
2,872 |
|
|
|
(17 |
) |
Stock compensation expense |
|
|
12,297 |
|
|
|
12,155 |
|
|
|
45,091 |
|
|
|
49,361 |
|
Depreciation and amortization |
|
|
15,851 |
|
|
|
12,386 |
|
|
|
42,620 |
|
|
|
38,456 |
|
Other, net |
|
|
2,919 |
|
|
|
652 |
|
|
|
3,470 |
|
|
|
812 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Increase) decrease in accounts receivable |
|
|
(106,065 |
) |
|
|
43,885 |
|
|
|
(274,440 |
) |
|
|
246,175 |
|
Increase (decrease) in accounts payable and accrued expenses |
|
|
94,263 |
|
|
|
(58,816 |
) |
|
|
201,940 |
|
|
|
(141,199 |
) |
(Increase) decrease in deferred contract costs |
|
|
(81,486 |
) |
|
|
10,301 |
|
|
|
(99,887 |
) |
|
|
28,550 |
|
Increase (decrease) in contract liabilities |
|
|
91,638 |
|
|
|
(13,211 |
) |
|
|
112,244 |
|
|
|
(36,933 |
) |
(Decrease) in income taxes payable, net |
|
|
(41,286 |
) |
|
|
(671 |
) |
|
|
(10,644 |
) |
|
|
(33,284 |
) |
(Increase) decrease in other, net |
|
|
(17,373 |
) |
|
|
(744 |
) |
|
|
(13,242 |
) |
|
|
47 |
|
Net cash from operating activities |
|
|
161,599 |
|
|
|
161,499 |
|
|
|
513,320 |
|
|
|
606,689 |
|
Investing Activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of property and equipment |
|
|
(9,178 |
) |
|
|
(15,521 |
) |
|
|
(37,419 |
) |
|
|
(37,943 |
) |
Other, net |
|
|
1,174 |
|
|
|
232 |
|
|
|
963 |
|
|
|
1,525 |
|
Net cash from investing activities |
|
|
(8,004 |
) |
|
|
(15,289 |
) |
|
|
(36,456 |
) |
|
|
(36,418 |
) |
Financing Activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock |
|
|
121,430 |
|
|
|
60,713 |
|
|
|
174,016 |
|
|
|
120,190 |
|
Repurchases of common stock |
|
|
— |
|
|
|
(61,999 |
) |
|
|
(314,225 |
) |
|
|
(296,922 |
) |
Dividends paid |
|
|
— |
|
|
|
— |
|
|
|
(86,815 |
) |
|
|
(85,184 |
) |
Payments for taxes related to net share settlement of equity awards |
|
|
— |
|
|
|
— |
|
|
|
(10,566 |
) |
|
|
(6,674 |
) |
Net cash from financing activities |
|
|
121,430 |
|
|
|
(1,286 |
) |
|
|
(237,590 |
) |
|
|
(268,590 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
10,030 |
|
|
|
(11,604 |
) |
|
|
(4,255 |
) |
|
|
(9,446 |
) |
Change in cash and cash equivalents |
|
|
285,055 |
|
|
|
133,320 |
|
|
|
235,019 |
|
|
|
292,235 |
|
Cash and cash equivalents at beginning of period |
|
|
1,180,455 |
|
|
|
1,082,650 |
|
|
|
1,230,491 |
|
|
|
923,735 |
|
Cash and cash equivalents at end of period |
|
$ |
1,465,510 |
|
|
$ |
1,215,970 |
|
|
$ |
1,465,510 |
|
|
$ |
1,215,970 |
|
Taxes Paid: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income taxes |
|
$ |
106,434 |
|
|
$ |
61,201 |
|
|
$ |
180,242 |
|
|
$ |
196,169 |
|
03-November-2020 |
Expeditors International of Washington, Inc. |
Page 5 of 7 |
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Business Segment Information
(In thousands)
(Unaudited)
|
|
UNITED STATES |
|
|
OTHER NORTH AMERICA |
|
|
LATIN AMERICA |
|
|
NORTH ASIA |
|
|
SOUTH ASIA |
|
|
EUROPE |
|
|
MIDDLE EAST, AFRICA AND INDIA |
|
|
ELIMI- NATIONS |
|
|
CONSOLI- DATED |
|
|||||||||
For the three months ended September 30, 2020: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues1 |
|
$ |
686,245 |
|
|
|
78,129 |
|
|
|
39,193 |
|
|
|
883,104 |
|
|
|
267,228 |
|
|
|
378,048 |
|
|
|
133,765 |
|
|
|
(915 |
) |
|
|
2,464,797 |
|
Directly related cost of transportation and other expenses2 |
|
$ |
379,588 |
|
|
|
44,911 |
|
|
|
23,361 |
|
|
|
720,807 |
|
|
|
200,334 |
|
|
|
261,325 |
|
|
|
100,619 |
|
|
|
(527 |
) |
|
|
1,730,418 |
|
Salaries and other operating expenses3 |
|
$ |
197,749 |
|
|
|
25,325 |
|
|
|
12,359 |
|
|
|
81,876 |
|
|
|
39,926 |
|
|
|
96,658 |
|
|
|
28,925 |
|
|
|
(384 |
) |
|
|
482,434 |
|
Operating income |
|
$ |
108,908 |
|
|
|
7,893 |
|
|
|
3,473 |
|
|
|
80,421 |
|
|
|
26,968 |
|
|
|
20,065 |
|
|
|
4,221 |
|
|
|
(4 |
) |
|
|
251,945 |
|
Identifiable assets at period end |
|
$ |
2,336,071 |
|
|
|
163,943 |
|
|
|
76,173 |
|
|
|
689,525 |
|
|
|
231,771 |
|
|
|
642,124 |
|
|
|
228,423 |
|
|
|
(9,476 |
) |
|
|
4,358,554 |
|
Capital expenditures |
|
$ |
4,703 |
|
|
|
483 |
|
|
|
180 |
|
|
|
1,075 |
|
|
|
665 |
|
|
|
1,780 |
|
|
|
292 |
|
|
|
— |
|
|
|
9,178 |
|
Equity |
|
$ |
1,791,658 |
|
|
|
77,915 |
|
|
|
31,324 |
|
|
|
246,557 |
|
|
|
97,564 |
|
|
|
185,352 |
|
|
|
110,714 |
|
|
|
(36,611 |
) |
|
|
2,504,473 |
|
For the three months ended September 30, 2019: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues1 |
|
$ |
692,229 |
|
|
|
88,088 |
|
|
|
38,341 |
|
|
|
624,351 |
|
|
|
196,569 |
|
|
|
320,769 |
|
|
|
115,397 |
|
|
|
(889 |
) |
|
|
2,074,855 |
|
Directly related cost of transportation and other expenses2 |
|
$ |
389,254 |
|
|
|
51,420 |
|
|
|
22,990 |
|
|
|
489,195 |
|
|
|
145,345 |
|
|
|
221,149 |
|
|
|
81,592 |
|
|
|
(446 |
) |
|
|
1,400,499 |
|
Salaries and other operating expenses3 |
|
$ |
210,767 |
|
|
|
25,731 |
|
|
|
14,547 |
|
|
|
70,410 |
|
|
|
32,482 |
|
|
|
86,156 |
|
|
|
28,151 |
|
|
|
(438 |
) |
|
|
467,806 |
|
Operating income |
|
$ |
92,208 |
|
|
|
10,937 |
|
|
|
804 |
|
|
|
64,746 |
|
|
|
18,742 |
|
|
|
13,464 |
|
|
|
5,654 |
|
|
|
(5 |
) |
|
|
206,550 |
|
Identifiable assets at period end |
|
$ |
2,059,345 |
|
|
|
128,336 |
|
|
|
72,029 |
|
|
|
489,322 |
|
|
|
164,976 |
|
|
|
563,289 |
|
|
|
226,657 |
|
|
|
2,499 |
|
|
|
3,706,453 |
|
Capital expenditures |
|
$ |
7,644 |
|
|
|
513 |
|
|
|
833 |
|
|
|
523 |
|
|
|
631 |
|
|
|
5,119 |
|
|
|
258 |
|
|
|
— |
|
|
|
15,521 |
|
Equity |
|
$ |
1,578,682 |
|
|
|
60,526 |
|
|
|
27,217 |
|
|
|
216,061 |
|
|
|
77,733 |
|
|
|
169,450 |
|
|
|
111,355 |
|
|
|
(31,737 |
) |
|
|
2,209,287 |
|
|
|
UNITED STATES |
|
|
OTHER NORTH AMERICA |
|
|
LATIN AMERICA |
|
|
NORTH ASIA |
|
|
SOUTH ASIA |
|
|
EUROPE |
|
|
MIDDLE EAST, AFRICA AND INDIA |
|
|
ELIMI- NATIONS |
|
|
CONSOLI- DATED |
|
|||||||||
For the nine months ended September 30, 2020: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues1 |
|
$ |
1,975,883 |
|
|
|
234,274 |
|
|
|
114,636 |
|
|
|
2,538,117 |
|
|
|
660,583 |
|
|
|
1,086,118 |
|
|
|
340,415 |
|
|
|
(2,733 |
) |
|
|
6,947,293 |
|
Directly related cost of transportation and other expenses2 |
|
$ |
1,108,173 |
|
|
|
132,250 |
|
|
|
69,827 |
|
|
|
2,054,023 |
|
|
|
481,971 |
|
|
|
754,863 |
|
|
|
248,503 |
|
|
|
(1,423 |
) |
|
|
4,848,187 |
|
Salaries and other operating expenses3 |
|
$ |
631,396 |
|
|
|
74,320 |
|
|
|
36,220 |
|
|
|
236,480 |
|
|
|
109,018 |
|
|
|
274,269 |
|
|
|
80,063 |
|
|
|
(1,286 |
) |
|
|
1,440,480 |
|
Operating income |
|
$ |
236,314 |
|
|
|
27,704 |
|
|
|
8,589 |
|
|
|
247,614 |
|
|
|
69,594 |
|
|
|
56,986 |
|
|
|
11,849 |
|
|
|
(24 |
) |
|
|
658,626 |
|
Identifiable assets at period end |
|
$ |
2,336,071 |
|
|
|
163,943 |
|
|
|
76,173 |
|
|
|
689,525 |
|
|
|
231,771 |
|
|
|
642,124 |
|
|
|
228,423 |
|
|
|
(9,476 |
) |
|
|
4,358,554 |
|
Capital expenditures |
|
$ |
28,276 |
|
|
|
1,692 |
|
|
|
498 |
|
|
|
1,785 |
|
|
|
1,035 |
|
|
|
3,418 |
|
|
|
715 |
|
|
|
— |
|
|
|
37,419 |
|
Equity |
|
$ |
1,791,658 |
|
|
|
77,915 |
|
|
|
31,324 |
|
|
|
246,557 |
|
|
|
97,564 |
|
|
|
185,352 |
|
|
|
110,714 |
|
|
|
(36,611 |
) |
|
|
2,504,473 |
|
For the nine months ended September 30, 2019: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues1 |
|
$ |
2,033,088 |
|
|
|
265,035 |
|
|
|
111,277 |
|
|
|
1,879,155 |
|
|
|
555,128 |
|
|
|
952,790 |
|
|
|
336,383 |
|
|
|
(2,371 |
) |
|
|
6,130,485 |
|
Directly related cost of transportation and other expenses2 |
|
$ |
1,142,701 |
|
|
|
157,997 |
|
|
|
64,149 |
|
|
|
1,475,395 |
|
|
|
407,642 |
|
|
|
657,720 |
|
|
|
236,184 |
|
|
|
(1,468 |
) |
|
|
4,140,320 |
|
Salaries and other operating expenses3 |
|
$ |
636,243 |
|
|
|
76,283 |
|
|
|
41,342 |
|
|
|
208,781 |
|
|
|
97,324 |
|
|
|
258,339 |
|
|
|
86,385 |
|
|
|
(884 |
) |
|
|
1,403,813 |
|
Operating income |
|
$ |
254,144 |
|
|
|
30,755 |
|
|
|
5,786 |
|
|
|
194,979 |
|
|
|
50,162 |
|
|
|
36,731 |
|
|
|
13,814 |
|
|
|
(19 |
) |
|
|
586,352 |
|
Identifiable assets at period end |
|
$ |
2,059,345 |
|
|
|
128,336 |
|
|
|
72,029 |
|
|
|
489,322 |
|
|
|
164,976 |
|
|
|
563,289 |
|
|
|
226,657 |
|
|
|
2,499 |
|
|
|
3,706,453 |
|
Capital expenditures |
|
$ |
23,544 |
|
|
|
1,509 |
|
|
|
1,071 |
|
|
|
1,167 |
|
|
|
1,235 |
|
|
|
8,015 |
|
|
|
1,402 |
|
|
|
— |
|
|
|
37,943 |
|
Equity |
|
$ |
1,578,682 |
|
|
|
60,526 |
|
|
|
27,217 |
|
|
|
216,061 |
|
|
|
77,733 |
|
|
|
169,450 |
|
|
|
111,355 |
|
|
|
(31,737 |
) |
|
|
2,209,287 |
|
1Beginning in the second quarter of 2019, the Company revised its process to record the transfer, between its geographic operating segments, of revenues and the directly related cost of transportation and other expenses for freight service transactions between Company origin and destination locations. This change better aligns revenue reporting with the location where the services are performed, as well as the transactional reporting being developed as part of the Company’s new accounting systems and processes. The change in presentation had nine months ended September 30, 2019, segment revenues have not been revised.
2Directly related cost of transportation and other expenses totals Operating Expenses from Airfreight services, Ocean freight and ocean services and Customs brokerage and other services as shown in the Condensed Consolidated Statements of Earnings.
3Salaries and other operating expenses totals Salaries and related, Rent and occupancy, Depreciation and amortization, Selling and promotion and Other as shown in the Condensed Consolidated Statements of Earnings.
The Company’s consolidated financial results in the nine months ended September 30, 2020 was significantly impacted by the effects of the global pandemic and are expected to be further impacted in the remainder of 2020. The impact is affecting the Company’s geographical segments unevenly.
03-November-2020 |
Expeditors International of Washington, Inc. |
Page 6 of 7 |
In the second and third quarter of 2020, North Asia experienced significant increases in airfreight services revenues and directly related expenses primarily as a result of demand for time-sensitive delivery of technology equipment and medical equipment and supplies from China, which combined with reductions in airfreight supply resulted in significantly higher rates. In the third quarter 2020 and 2019, the People's Republic of China, including Hong Kong, represented 30% and 26%, respectively, of the Company’s total revenues and 26% of the Company’s total operating income in both periods.
This is in contrast with slower activity in North Asia in the first quarter of 2020 as the global pandemic resulted in temporary closures and limited operations from the Company’s China offices and shipments that were rerouted or delayed by customers and service providers taking their own precautionary measures. In the nine months ended September 30, 2020 and 2019, the People's Republic of China, including Hong Kong, represented 31% and 26%, respectively, of the Company’s total revenues and 30% and 27%, respectively, of the Company’s total operating income.
03-November-2020 |
Expeditors International of Washington, Inc. |
Page 7 of 7 |
Document and Entity Information |
Nov. 03, 2020 |
---|---|
Cover [Abstract] | |
Document Type | 8-K |
Amendment Flag | false |
Document Period End Date | Nov. 03, 2020 |
Entity Registrant Name | EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. |
Entity Central Index Key | 0000746515 |
Entity Emerging Growth Company | false |
Entity File Number | 000-13468 |
Entity Incorporation, State or Country Code | WA |
Entity Tax Identification Number | 91-1069248 |
Entity Address, Address Line One | 1015 Third Avenue |
Entity Address, City or Town | Seattle |
Entity Address, State or Province | WA |
Entity Address, Postal Zip Code | 98104 |
City Area Code | 206 |
Local Phone Number | 674-3400 |
Written Communications | false |
Soliciting Material | false |
Pre-commencement Tender Offer | false |
Pre-commencement Issuer Tender Offer | false |
Title of each class | Common Stock, par value $0.01 per share |
Trading Symbol | EXPD |
Name of each exchange on which registered | NASDAQ |
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