C.H. Robinson releases Q1 2019 results

C.H. Robinson 48.3%

In the first quarter of 2019 total revenues decreased 4.4% to $3.8bn, driven by lower pricing across most transportation service lines. Net revenues increased 8.4% to $678.8m, due to margin improvement in truckload services.

Operating expenses increased 4.6% to $454.3m. Personnel expenses increased 3.6% to $340.1m, driven primarily by a 1.9% increase in average headcount, partially offset by declines in performance-based equity compensation. Selling, general and administrative expenses increased 7.6% to $114.2m, due to increases in purchased services, particularly commercial off-the-shelf software.

Income from operations totalled $224.6m, up 17.2% due to growth in North American Surface Transportation (NAST) and Global Forwarding, partially offset by a decline in All Other and Corporate. Its operating margin of 33.1% increased 250 basis points. The first quarter also included a $5.0m unfavourable impact from currency revaluation.

C.H. Robinson’s NAST segment revenues totalled $2.8bn, a 3.8% decrease, due to lower prices. NAST net revenues increased 11.0% in the quarter to $486.6m. Net revenues in truckload increased 14.7%, less than truckload (LTL) net revenues increased 3.6%, and intermodal net revenues decreased 3.9%. Excluding the impact of the change in fuel prices, average North America truckload rate per mile charged to customers decreased 5.5%. While truckload transportation cost per mile decreased 8.5% and truckload volumes increased 0.5%, LTL volumes grew 1.0%, and intermodal volumes declined 33% versus the prior year. Operating expenses increased 6.4%, due to increased cash compensation. Income from operations increased 17.6% to $211.3m, and operating margin expanded 240 basis points to 43.4%. NAST average headcount was up 1.7% in the quarter.

The Global Forwarding segment reported total revenues of $537.6m a 2.9% decrease while net revenues increased 3.4% to $127.2m. Despite volumes being flat in the first quarter, ocean net revenues increased 4.0% driven by margin expansion. The air freight division reported a 0.4% net revenue increase, as margin expansion was largely offset by a decline in shipments. Customs net revenues increased 5.9%, driven by volume growth. Operating expenses decreased 1.6%, driven by a 1.3% decrease in average headcount. Income from operations increased 72.8% to $14.2m, and operating margin expanded 450 basis points to 11.2%.

Robinson Fresh net revenues decreased 5.2% to $28.7m, as weather-related crop reductions drove case volume declines. Managed Services net revenues increased 10.9% to $20.3m, driven by a combination of selling additional service lines to existing customers and new customer wins. Other Surface Transportation net revenues increased 0.7% to $16.0m, driven by volume growth in Europe truckload.

Source: C.H. Robinson