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Share Name | Share Symbol | Market | Type |
---|---|---|---|
CH Robinson Worldwide Inc | NASDAQ:CHRW | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.85 | -0.97% | 86.98 | 85.43 | 86.95 | 88.61 | 86.35 | 86.59 | 1,538,096 | 01:00:00 |
C.H. Robinson Worldwide, Inc. (“C.H. Robinson”) (Nasdaq: CHRW) today reported financial results for the quarter ended September 30, 2023.
Third Quarter Key Metrics:
(1) Adjusted operating margin, adjusted operating margin – excluding restructuring and adjusted EPS are non-GAAP financial measures. The same factors described in this release that impacted these non-GAAP measures also impacted the comparable GAAP measures. Refer to pages 11 through 13 for further discussion and GAAP to Non-GAAP Reconciliations.
"As has been well documented by many industry participants and observers, global freight demand continued to be weak in the third quarter," said C.H. Robinson's President and Chief Executive Officer, Dave Bozeman. "We are staying focused on what we can control, by providing superior service to our customers and carriers, executing on our plans to streamline our processes by removing waste and manual touches, and delivering tools that enable our customer- and carrier-facing employees to allocate their time to relationship building and exception management. Our focus on delivering quality and improvements to our customers, such as enhanced visibility and increased automation, has been reflected in very positive feedback from customers and validated by net promoter scores this year that are the highest on record for the company, which we believe sets us up well with customers for the eventual positive inflection in the freight market."
"Our customers value the quality, stability and reliability that we provide, as they work to optimize their transportation needs. This has taken on greater importance to shippers who had exposure to transportation providers whose business models were not financially viable. During my many discussions with customers over the past four months, it’s clear that they prefer partners who have financial strength and can invest through cycles in the customer experience. They also want partners who have the expertise to provide innovative solutions, enabled by technology and people that they rely on to serve as an extension of their team. C.H. Robinson is that partner, with people who have deep expertise in the freight market and longstanding relationships with their customers and carriers. Combined with Robinson’s strong technology and large data set, our people are able to provide innovative tech-enabled solutions powered by our information advantage for the benefit of our customers and carriers. This secret sauce is not easy to replicate with a digital-only solution," added Bozeman.
"We’re executing on our plans to streamline our processes by removing waste and manual touches, and the result has been meaningful cost reductions and productivity gains across our business that are ahead of our stated targets. Even though I’m pleased with the progress that the team has made, I’ve challenged them to increase our clock speed on decision making and improvement efforts. We’re now driving focus on a handful of concurrent workstreams that are addressing the highest leverage areas to eliminate productivity bottlenecks."
"Ultimately, our focus on continuously improving the customer and carrier experience and removing waste from our workflows will result in a company that is quicker, more flexible and more agile in solving problems for our customers, providing better customer service and creating operating leverage and profitable growth. I’m excited about the work that we’re doing to reinvigorate Robinson’s winning culture, and I’m confident that together we will win for our customers, carriers, employees and shareholders," Bozeman concluded.
Summary of Third Quarter of 2023 Results Compared to the Third Quarter of 2022
Summary of 2023 Year-to-Date Results Compared to 2022
North American Surface Transportation (“NAST”) Results
Summarized financial results of our NAST segment are as follows (dollars in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2023
2022
% change
2023
2022
% change
Total revenues
$
3,086,970
$
4,002,461
(22.9
)%
$
9,470,425
$
12,264,396
(22.8
)%
Adjusted gross profits(1)
386,510
563,787
(31.4
)%
1,213,697
1,694,438
(28.4
)%
Income from operations
112,121
211,899
(47.1
)%
364,002
670,752
(45.7
)%
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.
Third quarter total revenues for the NAST segment totaled $3.1 billion, a decrease of 22.9% over the prior year, primarily driven by lower truckload pricing, reflecting an oversupply of truckload capacity compared to soft freight demand. NAST adjusted gross profits decreased 31.4% in the quarter to $386.5 million. Adjusted gross profits in truckload decreased 40.4% due to a 36.5% decrease in adjusted gross profit per shipment and a 6.0% decline in truckload shipments. Our average truckload linehaul rate per mile charged to our customers, which excludes fuel surcharges, decreased approximately 16.5% in the quarter compared to the prior year, while truckload linehaul cost per mile, excluding fuel surcharges, decreased approximately 13.5%, resulting in a 34.0% decrease in truckload adjusted gross profit per mile. LTL adjusted gross profits decreased 15.3% versus the year-ago period, as adjusted gross profit per order decreased 13.5% and LTL shipments decreased 2.0%. NAST overall volume growth was down 3.5% for the quarter. Operating expenses decreased 22.0% primarily due to cost optimization efforts, including lower average employee headcount, and lower variable compensation. NAST average employee headcount was down 16.2% in the quarter. Income from operations decreased 47.1% to $112.1 million, and adjusted operating margin declined 860 basis points to 29.0%.
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,
2023
2022
% change
2023
2022
% change
Total revenues
$
719,045
$
1,511,115
(52.4
)%
$
2,288,890
$
5,798,702
(60.5
)%
Adjusted gross profits(1)
169,893
248,433
(31.6
)%
527,043
894,724
(41.1
)%
Income from operations
3,491
85,953
(95.9
)%
63,254
421,148
(85.0
)%
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.
Third quarter total revenues for the Global Forwarding segment decreased 52.4% to $719.0 million, primarily driven by lower pricing in our ocean service, reflecting an oversupply of vessel capacity compared to soft freight demand. Adjusted gross profits decreased 31.6% in the quarter to $169.9 million. Ocean adjusted gross profits decreased 35.0%, driven by a 34.5% decrease in adjusted gross profit per shipment and a 0.5% decline in shipments. Air adjusted gross profits decreased 36.8%, driven by a 35.5% decrease in adjusted gross profit per metric ton shipped and a 2.0% decline in metric tons shipped. Customs adjusted gross profits decreased 10.7%, driven primarily by an 8.0% reduction in transaction volume. Operating expenses increased 2.4%, primarily due to $23.6 million of restructuring expenses, which were partially offset by cost optimization efforts, including lower average employee headcount, and lower variable compensation. Third quarter average employee headcount decreased 13.3%. Income from operations decreased 95.9% to $3.5 million, and adjusted operating margin declined 3,250 basis points to 2.1% in the quarter. Adjusted operating margin, excluding restructuring expenses, was 15.9% for the quarter.
All Other and Corporate Results
Total revenues and adjusted gross profits 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,
2023
2022
% change
2023
2022
% change
Total revenues
$
535,015
$
501,800
6.6
%
$
1,615,241
$
1,566,706
3.1
%
Adjusted gross profits(1):
Robinson Fresh
$
31,083
$
27,677
12.3
%
$
100,123
$
93,163
7.5
%
Managed Services
29,427
29,595
(0.6
)%
87,350
85,295
2.4
%
Other Surface Transportation
17,936
17,702
1.3
%
57,772
57,383
0.7
%
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.
Third quarter Robinson Fresh adjusted gross profits increased 12.3% to $31.1 million, primarily driven by a 23.0% increase in case volume in retail and integrated supply chain solutions for foodservice customers. Managed Services adjusted gross profits decreased 0.6% in the quarter. Other Surface Transportation adjusted gross profits increased 1.3% to $17.9 million, primarily due to an increase in Europe LTL adjusted gross profits.
Other Income Statement Items
The third quarter effective tax rate was 11.7%, down from 16.9% last year. The lower rate in the third quarter of this year was driven by lower income before taxes and incremental benefits from foreign tax credits. We now expect our 2023 full-year effective tax rate to be 14% to 15%.
Interest and other income/expense, net totaled $20.7 million of expense, consisting primarily of $21.8 million of interest expense, which increased $1.0 million versus the third quarter of 2022 due to higher variable interest rates.
Diluted weighted average shares outstanding in the quarter were down 5.8% due to share repurchases over the past twelve months.
Cash Flow Generation and Capital Distribution
Cash generated from operations totaled $205.2 million in the third quarter, compared to $625.5 million of cash generated from operations in the third quarter of 2022. The $420.2 million decrease was primarily related to a $304.4 million decline in cash provided by changes in net operating working capital, due to a $54.9 million sequential decrease in net operating working capital in the third quarter of 2023 compared to a $359.3 million sequential decrease in the third quarter of 2022.
In the third quarter of 2023, cash returned to shareholders totaled $75.8 million, with $72.7 million in cash dividends and $3.0 million in repurchases of common stock.
Capital expenditures totaled $16.7 million in the quarter. Capital expenditures for 2023 are expected to be toward the lower end of the previously provided range of $90 million to $100 million.
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 $30 billion in freight under management and 20 million shipments annually, we are one of the world’s largest logistics platforms. 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 100,000 customers and the more than 450,000 contract carriers on our platform. 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, factors such as changes in economic conditions, including uncertain consumer demand; changes in market demand and pressures on the pricing for our services; fuel price increases or decreases, or fuel shortages; competition and growth rates within the global logistics industry; freight levels and increasing costs and availability of truck capacity or alternative means of transporting freight; risks associated with significant disruptions in the transportation industry; changes in relationships with existing contracted truck, rail, ocean, and air carriers; changes in our customer base due to possible consolidation among our customers; risks with reliance on technology to operate our business; cyber-security related risks; risks associated with operations outside of the United States; our ability to successfully integrate the operations of acquired companies with our historic operations; climate change related risks; risks associated with our indebtedness; interest rates related risks; risks associated with litigation, including contingent auto liability and insurance coverage; risks associated with the potential impact of changes in government regulations; risks associated with the changes to income tax regulations; risks associated with the produce industry, including food safety and contamination issues; the impact of war on the economy; changes to our capital structure; changes due to catastrophic events including pandemics such as COVID-19; risks associated with the usage of artificial intelligence technologies; 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 2023 Earnings Conference Call Wednesday, November 1, 2023; 5:00 p.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
Adjusted Gross Profit by Service Line (in thousands)
This table of summary results presents our service line adjusted gross profits on an enterprise basis. The service line adjusted gross profits in the table differ from the service line adjusted gross profits discussed within the segments as our segments may have revenues from multiple service lines.
Three Months Ended September 30,
Nine Months Ended September 30,
2023
2022
% change
2023
2022
% change
Adjusted gross profits(1):
Transportation
Truckload
$
245,439
$
398,418
(38.4
)%
$
795,240
$
1,214,465
(34.5
)%
LTL
137,949
162,130
(14.9
)%
413,771
482,740
(14.3
)%
Ocean
104,116
160,122
(35.0
)%
321,692
609,543
(47.2
)%
Air
30,201
47,831
(36.9
)%
95,246
166,136
(42.7
)%
Customs
24,904
27,881
(10.7
)%
73,366
83,196
(11.8
)%
Other logistics services
64,838
65,441
(0.9
)%
196,333
182,638
7.5
%
Total transportation
607,447
861,823
(29.5
)%
1,895,648
2,738,718
(30.8
)%
Sourcing
27,402
25,371
8.0
%
90,337
86,285
4.7
%
Total adjusted gross profits
$
634,849
$
887,194
(28.4
)%
$
1,985,985
$
2,825,003
(29.7
)%
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.
GAAP to Non-GAAP Reconciliation (unaudited, in thousands)
Our adjusted gross profit is a non-GAAP financial measure. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers. We believe adjusted gross profit is a useful measure of our ability to source, add value, and sell services and products that are provided by third parties, and we consider adjusted gross profit to be a primary performance measurement. Accordingly, the discussion of our results of operations often focuses on the changes in our adjusted gross profit. The reconciliation of gross profit to adjusted gross profit is presented below (in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2023
2022
% change
2023
2022
% change
Revenues:
Transportation
$
4,029,407
$
5,724,364
(29.6
)%
$
12,442,199
$
18,718,357
(33.5
)%
Sourcing
311,623
291,012
7.1
%
932,357
911,447
2.3
%
Total revenues
4,341,030
6,015,376
(27.8
)%
13,374,556
19,629,804
(31.9
)%
Costs and expenses:
Purchased transportation and related services
3,421,960
4,862,541
(29.6
)%
10,546,551
15,979,639
(34.0
)%
Purchased products sourced for resale
284,221
265,641
7.0
%
842,020
825,162
2.0
%
Direct internally developed software amortization
8,233
6,457
27.5
%
24,299
18,831
29.0
%
Total direct expenses
3,714,414
5,134,639
(27.7
)%
11,412,870
16,823,632
(32.2
)%
Gross profit
$
626,616
$
880,737
(28.9
)%
$
1,961,686
$
2,806,172
(30.1
)%
Plus: Direct internally developed software amortization
8,233
6,457
27.5
%
24,299
18,831
29.0
%
Adjusted gross profit
$
634,849
$
887,194
(28.4
)%
$
1,985,985
$
2,825,003
(29.7
)%
Our adjusted operating margin is a non-GAAP financial measure calculated as operating income divided by adjusted gross profit. Our adjusted operating margin - excluding restructuring is a similar non-GAAP financial measure as adjusted operating margin, but also excludes the impact of restructuring and related costs. We believe adjusted operating margin and adjusted operating margin - excluding restructuring are useful measures of our profitability in comparison to our adjusted gross profit, which we consider a primary performance metric as discussed above. The comparisons of operating margin to adjusted operating margin and adjusted operating margin - excluding restructuring are presented below:
Three Months Ended September 30,
Nine Months Ended September 30,
2023
2022
% change
2023
2022
% change
Total revenues
$
4,341,030
$
6,015,376
(27.8
)%
$
13,374,556
$
19,629,804
(31.9
)%
Income from operations
113,522
287,609
(60.5
)%
407,178
1,102,748
(63.1
)%
Operating margin
2.6
%
4.8
%
(220) bps
3.0
%
5.6
%
(260) bps
Adjusted gross profit
$
634,849
$
887,194
(28.4
)%
$
1,985,985
$
2,825,003
(29.7
)%
Income from operations
113,522
287,609
(60.5
)%
407,178
1,102,748
(63.1
)%
Adjusted operating margin
17.9
%
32.4
%
(1,450) bps
20.5
%
39.0
%
(1,850) bps
Adjusted gross profit
$
634,849
$
887,194
(28.4
)%
$
1,985,985
$
2,825,003
(29.7
)%
Income from operations - excluding restructuring and gain on sale
137,985
$
287,609
(52.0
)%
449,495
$
1,077,452
(58.3
)%
Adjusted operating margin - excluding restructuring and gain on sale
21.7
%
32.4
%
(1,070) bps
22.6
%
38.1
%
(1,550) bps
GAAP to Non-GAAP Reconciliation (unaudited, in thousands)
Our adjusted income (loss) from operations, adjusted operating margin - excluding restructuring, and adjusted net income per share (diluted) are non-GAAP financial measures. Adjusted income (loss) from operations and adjusted net income per share (diluted) is calculated as income (loss) from operations, adjusted operating margin - excluding restructuring, and net income per share (diluted) excluding the impact of restructuring and related costs. We believe that these measures provide useful information to investors and include them within our internal reporting to our chief operating decision maker. Accordingly, the discussion of our results of operations includes discussion on the changes in our adjusted income (loss) from operations, adjusted operating margin - excluding restructuring, and adjusted net income per share (diluted). The reconciliation of income (loss) from operations, adjusted operating margin - excluding restructuring, and net income per share (diluted) to adjusted income (loss) from operations and adjusted net income per share (diluted) is presented below (in thousands except per share data):
NAST
Global Forwarding
All Other and Corporate
Consolidated
Three Months Ended September 30, 2023
Income (loss) from operations
$
112,121
$
3,491
$
(2,090
)
$
113,522
Severance
(64
)
2,530
619
3,085
Other selling, general, and administrative expenses
4
21,079
362
21,445
Other personnel expenses
(9
)
(17
)
(41
)
(67
)
Total restructuring and related costs(1)
(69
)
23,592
940
24,463
Income (loss) from operations - excluding restructuring
$
112,052
$
27,083
$
(1,150
)
$
137,985
Adjusted gross profit
$
386,510
$
169,893
$
78,446
$
634,849
Income (loss) from operations - excluding restructuring
112,052
27,083
(1,150
)
137,985
Adjusted operating margin - excluding restructuring
29.0
%
15.9
%
N/M
21.7
%
Net income per share (diluted)
$
0.68
Restructuring and related costs, net of tax(1)
0.16
Adjusted net income per share (diluted)
$
0.84
NAST
Global Forwarding
All
Other and Corporate
Consolidated
Nine Months Ended September 30, 2023
Income (loss) from operations
$
364,002
$
63,254
$
(20,078
)
$
407,178
Severance
869
4,670
12,365
17,904
Other selling, general, and administrative expenses
8
21,242
1,324
22,574
Other personnel expenses
214
72
1,553
1,839
Total restructuring and related costs(1)
1,091
25,984
15,242
42,317
Income (loss) from operations - excluding restructuring
$
365,093
$
89,238
$
(4,836
)
$
449,495
Adjusted gross profit
$
1,213,697
$
527,043
$
245,245
$
1,985,985
Income (loss) from operations - excluding restructuring
365,093
89,238
(4,836
)
449,495
Adjusted operating margin - excluding restructuring
30.1
%
16.9
%
N/M
22.6
%
Net income per share (diluted)
$
2.46
Restructuring and related costs, net of tax(1)
0.27
Adjusted net income per share (diluted)
$
2.73
____________________________________________
(1) In the three months ended September 30, 2023, we incurred restructuring expenses of $3.0 million related to workforce reductions and $21.4 million of asset impairment and other charges. In the nine months ended September 30, 2023, we incurred restructuring expenses of $19.7 million related to workforce reductions and $22.6 million of asset impairment and other charges.
GAAP to Non-GAAP Reconciliation (unaudited, in thousands)
Our adjusted income from operations and adjusted net income per share (diluted) are non-GAAP financial measures. Adjusted income from operations and adjusted net income per share (diluted) is calculated as income from operations and net income per share (diluted) excluding the impact of the gain on sale-leaseback of our Kansas City regional center. We believe that these measures provide useful information to investors and include them within our internal reporting to our chief operating decision maker. Accordingly, the discussion of our results of operations includes discussion on the changes in our adjusted income from operations and adjusted net income per share (diluted). The reconciliation of income from operations and net income per share (diluted) to adjusted income from operations and adjusted net income per share (diluted) is presented below (in thousands except per share data):
Nine Months Ended September 30, 2022
Income from operations
$
1,102,748
Gain on sale of property and equipment(1)
(25,296
)
Income from operations - excluding gain on sale
$
1,077,452
Net income per share (diluted)
$
6.50
Gain on sale of property and equipment(1)
(0.15
)
Adjusted net income per share (diluted)
$
6.35
_______________________________________
(1) The gain on sale of property and equipment related to the sale-leaseback of our Kansas City regional center is included within other selling, general, and administrative expenses in our condensed consolidated statements of income.
Condensed Consolidated Statements of Income
(unaudited, in thousands, except per share data)
Three Months Ended September 30,
Nine Months Ended September 30,
2023
2022
% change
2023
2022
% change
Revenues:
Transportation
$
4,029,407
$
5,724,364
(29.6
)%
$
12,442,199
$
18,718,357
(33.5
)%
Sourcing
311,623
291,012
7.1
%
932,357
911,447
2.3
%
Total revenues
4,341,030
6,015,376
(27.8
)%
13,374,556
19,629,804
(31.9
)%
Costs and expenses:
Purchased transportation and related services
3,421,960
4,862,541
(29.6
)%
10,546,551
15,979,639
(34.0
)%
Purchased products sourced for resale
284,221
265,641
7.0
%
842,020
825,162
2.0
%
Personnel expenses
343,532
437,545
(21.5
)%
1,103,915
1,295,670
(14.8
)%
Other selling, general, and administrative expenses
177,795
162,040
9.7
%
474,892
426,585
11.3
%
Total costs and expenses
4,227,508
5,727,767
(26.2
)%
12,967,378
18,527,056
(30.0
)%
Income from operations
113,522
287,609
(60.5
)%
407,178
1,102,748
(63.1
)%
Interest and other income/expense, net
(20,748
)
(15,972
)
29.9
%
(67,272
)
(57,541
)
16.9
%
Income before provision for income taxes
92,774
271,637
(65.8
)%
339,906
1,045,207
(67.5
)%
Provision for income taxes
10,825
45,839
(76.4
)%
45,750
200,876
(77.2
)%
Net income
$
81,949
$
225,798
(63.7
)%
$
294,156
$
844,331
(65.2
)%
Net income per share (basic)
$
0.69
$
1.81
(61.9
)%
$
2.48
$
6.60
(62.4
)%
Net income per share (diluted)
$
0.68
$
1.78
(61.8
)%
$
2.46
$
6.50
(62.2
)%
Weighted average shares outstanding (basic)
118,464
124,980
(5.2
)%
118,532
127,944
(7.4
)%
Weighted average shares outstanding (diluted)
119,751
127,190
(5.8
)%
119,762
129,839
(7.8
)%
Business Segment Information
(unaudited, in thousands, except average employee headcount)
NAST
Global Forwarding
All Other and Corporate
Consolidated
Three Months Ended September 30, 2023
Total revenues
$
3,086,970
$
719,045
$
535,015
$
4,341,030
Adjusted gross profits(1)
386,510
169,893
78,446
634,849
Income (loss) from operations
112,121
3,491
(2,090
)
113,522
Depreciation and amortization
5,882
5,446
14,216
25,544
Total assets(2)
3,162,720
1,081,262
1,073,685
5,317,667
Average employee headcount
6,278
5,082
4,217
15,577
NAST
Global Forwarding
All Other and Corporate
Consolidated
Three Months Ended September 30, 2022
Total revenues
$
4,002,461
$
1,511,115
$
501,800
$
6,015,376
Adjusted gross profits(1)
563,787
248,433
74,974
887,194
Income (loss) from operations
211,899
85,953
(10,243
)
287,609
Depreciation and amortization
5,739
5,368
11,868
22,975
Total assets(2)
3,624,333
2,266,923
904,274
6,795,530
Average employee headcount
7,493
5,861
4,691
18,045
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained above. The difference between adjusted gross profits and gross profits is not material.
(2) All cash and cash equivalents are included in All Other and Corporate.
Business Segment Information
(unaudited, in thousands, except average employee headcount)
NAST
Global Forwarding
All Other and Corporate
Consolidated
Nine Months Ended September 30, 2023
Total revenues
$
9,470,425
$
2,288,890
$
1,615,241
$
13,374,556
Adjusted gross profits(1)
1,213,697
527,043
245,245
1,985,985
Income (loss) from operations
364,002
63,254
(20,078
)
407,178
Depreciation and amortization
17,389
16,410
42,100
75,899
Total assets(2)
3,162,720
1,081,262
1,073,685
5,317,667
Average employee headcount
6,574
5,276
4,390
16,240
NAST
Global Forwarding
All Other and Corporate
Consolidated
Nine Months Ended September 30, 2022
Total revenues
$
12,264,396
$
5,798,702
$
1,566,706
$
19,629,804
Adjusted gross profits(1)
1,694,438
894,724
235,841
2,825,003
Income from operations
670,752
421,148
10,848
1,102,748
Depreciation and amortization
18,101
16,394
34,228
68,723
Total assets(2)
3,624,333
2,266,923
904,274
6,795,530
Average employee headcount
7,420
5,735
4,497
17,652
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained above. The difference between adjusted gross profits and gross profits is not material.
(2)All cash and cash equivalents are included in All Other and Corporate.
Condensed Consolidated Balance Sheets
(unaudited, in thousands)
September 30, 2023
December 31, 2022
Assets
Current assets:
Cash and cash equivalents
$
174,733
$
217,482
Receivables, net of allowance for credit loss
2,442,297
2,991,753
Contract assets, net of allowance for credit loss
204,737
257,597
Prepaid expenses and other
137,476
122,406
Total current assets
2,959,243
3,589,238
Property and equipment, net of accumulated depreciation and amortization
150,858
159,432
Right-of-use lease assets
350,896
372,141
Intangible and other assets, net of accumulated amortization
1,856,670
1,833,753
Total assets
$
5,317,667
$
5,954,564
Liabilities and stockholders’ investment
Current liabilities:
Accounts payable and outstanding checks
$
1,444,186
$
1,570,559
Accrued expenses:
Compensation
134,778
242,605
Transportation expense
156,611
199,092
Income taxes
6,782
15,210
Other accrued liabilities
170,539
168,009
Current lease liabilities
73,681
73,722
Current portion of debt
662,966
1,053,655
Total current liabilities
2,649,543
3,322,852
Long-term debt
920,720
920,049
Noncurrent lease liabilities
294,751
313,742
Noncurrent income taxes payable
29,640
28,317
Deferred tax liabilities
14,656
14,256
Other long-term liabilities
3,773
1,926
Total liabilities
3,913,083
4,601,142
Total stockholders’ investment
1,404,584
1,353,422
Total liabilities and stockholders’ investment
$
5,317,667
$
5,954,564
Condensed Consolidated Statements of Cash Flow
(unaudited, in thousands, except operational data)
Nine Months Ended September 30,
Operating activities:
2023
2022
Net income
$
294,156
$
844,331
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Depreciation and amortization
75,899
68,723
Provision for credit losses
(4,032
)
(2,407
)
Stock-based compensation
37,309
78,346
Deferred income taxes
(35,269
)
(76,362
)
Excess tax benefit on stock-based compensation
(9,899
)
(12,440
)
Loss on disposal group held for sale
21,113
—
Other operating activities
3,740
(24,011
)
Changes in operating elements, net of acquisitions:
Receivables
525,761
66,536
Contract assets
52,810
90,481
Prepaid expenses and other
(7,632
)
13,437
Accounts payable and outstanding checks
(122,312
)
(109,493
)
Accrued compensation
(106,943
)
6,701
Accrued transportation expenses
(42,481
)
(62,278
)
Accrued income taxes
3,131
(24,202
)
Other accrued liabilities
(2,636
)
22,209
Other assets and liabilities
1,900
(2,782
)
Net cash provided by operating activities
684,615
876,789
Investing activities:
Purchases of property and equipment
(25,889
)
(50,719
)
Purchases and development of software
(42,086
)
(49,935
)
Proceeds from sale of property and equipment
1,324
63,208
Net cash used for investing activities
(66,651
)
(37,446
)
Financing activities:
Proceeds from stock issued for employee benefit plans
46,061
93,415
Stock tendered for payment of withholding taxes
(23,754
)
(26,597
)
Repurchases of common stock
(63,884
)
(1,023,578
)
Cash dividends
(218,942
)
(216,258
)
Proceeds from long-term borrowings
—
200,000
Proceeds from short-term borrowings
2,778,750
3,674,000
Payments on short-term borrowings
(3,169,750
)
(3,595,000
)
Net cash used for financing activities
(651,519
)
(894,018
)
Effect of exchange rates on cash and cash equivalents
(6,708
)
(15,206
)
Net change in cash and cash equivalents, including cash classified within assets held for sale
(40,263
)
(69,881
)
Less: net increase in cash and cash equivalents within assets held for sale
(2,486
)
—
Cash and cash equivalents, beginning of period
217,482
257,413
Cash and cash equivalents, end of period
$
174,733
$
187,532
As of September 30,
Operational Data:
2023
2022
Employees
15,391
17,945
CHRW-IR
View source version on businesswire.com: https://www.businesswire.com/news/home/20231101510939/en/
FOR INQUIRIES, CONTACT: Chuck Ives, Director of Investor Relations Email: chuck.ives@chrobinson.com
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