C.H. Robinson Reports In Line EPS - Analyst Blog
25 Juli 2012 - 3:45PM
Zacks
C.H. Robinson Worldwide
Inc. (CHRW) has reported second quarter 2012 earnings per
share of 71 cents, in line with the Zacks Consensus
Estimate. Reported earnings also increased 6% from 67 cents in
the year-ago quarter.
Total revenue in the second quarter
escalated 9.2% year over year to $2.96 billion, surpassing the
Zacks Consensus Estimate of $2.92 billion.
Total operating expenses increased
1.2% year over year to $240.6 million, primarily due to 10.9% rise
in purchased transportation and related services expenses.
Total operating ratio (operating
expenses as a percentage of net revenue) was 56.5% in the reported
quarter, reflecting an improvement of 40 basis points (bps) from
56.9% in the year-ago quarter.
Segment Details
Transportation: The
segment (comprising Truck, Intermodal, Ocean, Air and Other
logistics services) reported gross profit of $369 million in the
second quarter, up 0.3% from the year-ago period.
Gross profit from Truck (comprising
truckload and less-than-truckload services) declined 0.5% to $312.6
million due to higher transportation cost.
Gross profit from Intermodal fell
7.8% year over year to $10 million due to declines in net revenue
margin that clouded volume growth. Net revenue margins were
affected by higher capacity cost and change in business mix. The
company purchased 500 containers and expects delivery by the third
quarter, replacing 350 leased containers.
Gross profit from Ocean grew 3.4%
year over year to $17 million based on higher pricing, offsetting
volume decline.
Air transportation gross profit
plunged 7.5% year over year to $10.6 million, primarily due to
lower pricing that offset volume growth.
Gross profit from Other logistics
services registered 26.7% year-over-year growth to $18.8 million on
better transportation management and higher customs net
revenues.
Sourcing: The segment’s
gross profit increased 15.1% year over year to $40.2 million
primarily on higher volumes and increased net revenue margin due to
commodity and service mix. Additionally, the acquisition of Timco
Worldwide last year also aided the segment’s growth.
Payment
Services: The segment’s gross profit
(comprising income from subsidiary, T-Chek Systems Inc.) climbed
8.1% year over year to $16.3 million in the second quarter, driven
by an increase in transactions.
Liquidity & Debt
Position
C.H. Robinson ended the quarter with
cash and cash equivalents of $240.6 million as against $315.9
million in the year-ago period and had no debt on its balance
sheet. Cash from operation rose to $110 million at the end of the
quarter from $78.9 million in the year-ago period.
Our Analysis
We believe the company remains well
positioned to benefit from its freight transportation business as
evident by strong shipments and pricing in Intermodal and less than
truckload market. Further, the cash-rich balance sheet with no debt
and increasing shareholder returns make it more attractive for
long-term investment. However, the company remains significantly
challenged by higher transportation costs followed by regulatory
issues and competitive threats from logistics services companies
such as Expeditors International of Washington
Inc. (EXPD).
Thus, we are currently maintaining
our long-term Neutral recommendation on C.H. Robinson. For the
short term, the company holds a Zacks #3 Rank (Hold).
CH ROBINSON WWD (CHRW): Free Stock Analysis Report
EXPEDITORS INTL (EXPD): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
Expeditors International... (NASDAQ:EXPD)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Expeditors International... (NASDAQ:EXPD)
Historical Stock Chart
Von Jul 2023 bis Jul 2024