Attached files
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| EX-99.1 - EX-99.1 - C. H. ROBINSON WORLDWIDE, INC. | d720657dex991.htm |
| 8-K - 8-K - C. H. ROBINSON WORLDWIDE, INC. | d720657d8k.htm |
 Earnings Conference Call –
First Quarter 2014
April 30, 2014
John Wiehoff, Chairman & CEO
Chad Lindbloom, CFO
Tim Gagnon, Director, Investor Relations
Exhibit 99.2 |
 2
Safe Harbor Statement
Except for the historical information contained herein, the matters set forth in
this presentation and the accompanying earnings 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, 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,
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; changes to
our share repurchase activity; and the impact of war on the economy; and other
risks and uncertainties detailed in our Annual and Quarterly Reports.
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 3
Q1 2014 Results
2014
2013
% Change
Total revenues
$3,142,585
$2,994,267
5.0%
Total net revenues
$457,235
$455,722
0.3%
Income from operations
$156,971
$168,706
-7.0%
Net income
$93,187
$103,343
-9.8%
Earnings per share (diluted)
$0.63
$0.64
-1.6%
Weighted average shares
outstanding
149,008
160,690
-7.3%
Three months ended March 31
in thousands, except per share amounts
•
Weather impacted our Truckload, Less than Truckload, Intermodal and
Sourcing results in the first quarter
•
Results improved significantly in March
•
2013 share repurchases positively impacted EPS in the first quarter
|
 4
in thousands
2014
2013
% Change
Total revenues
$3,142,585
$2,994,267
5.0%
Total net revenues
$457,235
$455,722
0.3%
Personnel expenses
220,297
212,645
3.6%
Selling, general & admin
79,967
74,371
7.5%
Total operating expenses
300,264
287,016
4.6%
Income from operations
$156,971
$168,706
-7.0%
Percent of net revenue
34.3%
37.0%
-7.3%
Summarized Income Statement
•
Personnel increase driven by average headcount growth of 6.1% in
the first
quarter of 2014 when compared to the first quarter of 2013, partially offset by
our variable compensation plans
•
First quarter 2014 ending headcount was virtually flat when compared to 2013
year end headcount
•
SG&A change largely from an increase in our provision for doubtful
accounts Three months ended March 31 |
 5
Transportation Results Q1 2014
•
Transportation
net
revenue
margin
compression
of
90
basis
points
in
the
first
quarter
of 2014 when compared to the first quarter of 2013
•
Transportation net revenue margin in March 2014 was virtually flat with March
2013 2014
2013
% Change
Total revenues
$2,803,704
$2,603,182
7.7%
Total net revenues
$427,879
$421,252
1.6%
Net revenue margin
15.3%
16.2%
-5.7%
Three months ended March 31
TRANSPORTATION in thousands
TRANSPORTATION NET REVENUE MARGIN PERCENTAGE
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Q1
17.8%
16.8%
17.4%
18.3%
20.2%
18.2%
22.6%
17.4%
17.2%
16.9%
16.2%
15.3%
Q2
15.9%
15.4%
16.3%
17.1%
17.9%
15.4%
20.6%
15.8%
16.2%
14.9%
15.3%
Q3
16.0%
15.9%
16.3%
17.5%
18.0%
15.9%
19.8%
16.6%
16.4%
15.6%
14.9%
Q4
15.8%
16.0%
15.7%
18.3%
17.7%
19.0%
18.3%
17.6%
16.3%
15.8%
15.0%
Year
16.3%
16.0%
16.3%
17.8%
18.4%
17.0%
20.2%
16.8%
16.5%
15.8%
15.3% |
 6
Truckload Results Q1 2014
2014
2013
% Change
$269,837
$268,604
0.5%
Three months ended March 31
TRUCKLOAD NET REVENUES in thousands
Quarter
Volume
3%
Approximate pricing *
10%
Approximate cost*
12%
Net revenue margin
North America
Truckload
Year over year change
*Pricing and cost measures exclude the estimated
impact of the change in fuel
•
Total Truckload volumes grew approximately four percent in the first quarter when
compared to the first quarter of 2013
•
North
America
Truckload
price
and
cost
per
mile
were
impacted
by
market
volatility
and a change in our freight mix
•
Significant price and cost increases in spot market transactions
•
Increased mix of short haul freight which has higher price and cost per mile
•
Negative loads (shipments that result in a loss) increased significantly in the
first quarter of 2014 when compared to the first quarter of 2013
•
March
2014
North
America
Truckload
net
revenue
margins
were
flat
when
compared to March 2013 |
 7
LTL Results Q1 2014
2014
2013
% Change
$60,138
$58,491
2.8%
Three months ended March 31
LTL NET REVENUES in thousands
Quarter
Volume
-2%
Pricing
Net revenue margin
LTL
Year over year change
•
Net
revenue
growth
rate
slowed
in
the
first
quarter
partially
as
a
result
of
weather
•
Net revenue margins compressed slightly in the first quarter of 2014 when
compared to the first quarter of 2013, primarily due to carrier price
increases |
 8
Intermodal
Results
Q1
2014
•
Widespread weather events had a significant impact on the first quarter
Intermodal results
•
Net revenue margin increase was driven by improved customer pricing
•
Intermodal volume declined in the first quarter of 2014 when compared to the
first quarter of 2013, primarily related to less available equipment and
extended transit times due to slowed equipment velocity
2014
2013
% Change
$8,940
$9,101
-1.8%
Three months ended March 31
Quarter
Volume
-6%
Pricing
Net revenue margin
Year over year change
INTERMODAL NET REVENUES in thousands
|
 9
Global
Forwarding
Results
Q1
2014
Ocean,
Air
and
Customs
2014
2013
% Change
Ocean
$43,612
$42,488
2.6%
Air
$17,454
$16,768
4.1%
Customs
$9,332
$8,606
8.4%
Three months ended March 31
NET
REVENUES
in
thousands
Quarter
Volume
Pricing
Net revenue margin
OCEAN
Quarter
Volume
Pricing
Net revenue margin
AIR
Year over year change
Year over year change
•
Margin compression in our Ocean business due to market volatility and strong
competition, offset by volume increases
•
•
Growth continues in Customs driven by increased volume
•
Systems integration an ongoing initiative in 2014
Increased volume from integrated businesses continues to benefit our scale in capacity
procurement in both Air and Ocean
|
 10
Other
Logistics
Services
Results
Q1
2014
•
Other Logistics Services net revenues include transportation management services,
warehousing and small parcel
•
These services continued to perform well driven by new customer implementations
and global volume growth
•
Transportation management services leverage our Navisphere technology
platform 2014
2013
% Change
$18,566
$17,194
8.0%
Three months ended March 31
NET
REVENUES
in
thousands |
 11
Sourcing
Results
Q1
2014
•
Continued volume and net revenue decreases from a large customer; impact will
continue throughout 2014
•
Sourcing net revenues and volumes were impacted by weather, a lack of product
availability with some key commodities and market volatility
2014
2013
% Change
Total revenues
$335,808
$387,852
-13.4%
Total net revenues
$26,846
$31,846
-15.7%
Net revenue margin
8.0%
8.2%
-2.6%
Three months ended March 31
SOURCING
in
thousands |
 12
BALANCE SHEET DATA
March 31, 2014
Cash & investments
$142,813
Current assets
$1,823,082
Total assets
$2,960,168
Debt
$910,000
Current liabilities
$1,380,489
Stockholders’
investment
$981,597
Other Financial Information
in thousands
•
2013 cash provided by operating activities impacted by tax payment of
approximately $100 million on 2012 gain from the divestiture of T-Chek
•
Accelerating revenue growth during the quarter drove increases in working
capital
•
Impacted net cash provided by operating activities
•
Impacted share repurchase activities
•
Total debt balance of $910 million
•
$500 million, 15 year average duration, 4.28% weighted average coupon
•
$410 million drawn on revolver, 1.65% current rate
CASH FLOW DATA
2014
2013
% Change
Net cash provided by operating activities -
actual
$14,440
-$58,050
N/A
Capital expenditures, net
$12,595
$10,177
23.8%
Three months ended March 31 |
 13
A look ahead
•
Truckload market conditions remain difficult to predict
•
Our North America Truckload net revenue margins in March and thus far in
April 2014 are approximately flat with last year
•
Our
existing
headcount
is
adequate
to
execute
our
current
growth
initiatives
•
We will continue to monitor and adapt to the market conditions
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