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Expeditors Announces 46% First Quarter Operating Income Increase

Dépèche transmise le 4 mai 2011 par Business Wire

SEATTLE--(BUSINESS WIRE)--Expeditors International of Washington, Inc. (NASDAQ: EXPD) today announced net earnings attributable to shareholders of $91,232,000 for the first quarter of 2011, as compared with $61,247,000 for the same quarter of 2010, an increase of 49%. Net revenues for the first quarter increased 25% to $453,915,000 as compared with $361,823,000 reported for the first quarter of 2010. Total revenues and operating income were $1,460,848,000 and $147,230,000 for the first quarter of 2011, as compared with $1,201,109,000 and $100,541,000 for the same quarter of 2010, increases of 22% and 46%, respectively. Diluted net earnings attributable to shareholders per share for the first quarter were $.42 as compared with $.28 for the same quarter in 2010, an increase of 50%. The Company also reported that same store net revenues and operating income increased 25% and 46%, respectively, during the first quarter of 2011, as compared with the same period in 2010.

“We were also impressed with the extent that productivity initiatives continue to benefit our operating income growth. A focus on strong market share growth and efficient operations has been the solid foundation upon which we continue to build our company”

“We should start off by acknowledging that this was an outstanding quarter by every measure. We always like to point out that it is our people, working in concert with our service providers, who really make this happen, and it is our customers who have given us the opportunities. We’re grateful to all of them. The most remarkable thing to us about this 2011 first quarter was the strong across the board operating income growth. All of our geographic operating segments made outstanding contributions. We think this means that we must be doing something right, not just in a few offices, but throughout our global network,” said Peter J. Rose, Chairman and Chief Executive Officer. “We were also impressed with the extent that productivity initiatives continue to benefit our operating income growth. A focus on strong market share growth and efficient operations has been the solid foundation upon which we continue to build our company,” Rose went on to say.

“Whenever we report above-consensus results, there follows a great deal of curiosity by some about what that means for our future expectations. Often a ‘mechanical upward adjustment’ by the amount we exceeded that quarter’s consensus is added onto to what were already challenging future expectations. Those who know us well know that we always decline to make projections and forecasts. What we do try to offer, however, are things that we think about internally that we wish everyone externally would consider. We think about rising fuel costs, rising costs in general, as inflation (which is now globally topical after not having been mentioned for years) and global political unrest. Volatile currency exchange rates and the current status of the US dollar should also be factored in. Does this mean we’re pessimistic? No, not at all. We think we do our best work helping our customers navigate through chaos and unexpected events, and in that sense, opportunity abounds. But we do think that future expectations need to be founded on realistic assessments of current conditions. They should not simply become a mechanical extrapolation exercise that slingshots a number out there from a base created by one single, albeit outstanding, quarter,” concluded Rose.

Expeditors is a global logistics company headquartered in Seattle, Washington. The company employs trained professionals in 184 full-service offices, 65 satellite locations and 2 international service centers located on six continents linked into a seamless worldwide network through an integrated information management system. Services include air and ocean freight forwarding, vendor consolidation, customs clearance, marine insurance, distribution and other value added international logistics services.

NOTE: See Disclaimer on Forward-Looking Statements on the following page of this release.

Expeditors International of Washington, Inc.
1^st Quarter 2011 Earnings Release, May 4, 2011

Financial highlights for the three months ended March 31, 2011 (Unaudited)
(in 000's of US dollars except share data)

		Three Months Ended
		2011		2010	% Increase
Revenues	$	1,460,848	$	1,201,109	22%
Net revenues	$	453,915	$	361,823	25%
Operating income	$	147,230	$	100,541	46%
Net earnings attributable to shareholders	$	91,232	$	61,247	49%
Diluted earnings attributable to shareholders per share	$	.42	$	.28	50%
Basic earnings attributable to shareholders per share	$	.43	$	.29	48%
Diluted weighted average shares outstanding		215,863,386		216,630,436
Basic weighted average shares outstanding		212,088,860		212,192,710

	Employee headcount as of March 31,
	2011	2010
North America	4,443	4,131
Asia Pacific	3,898	3,591
Europe and Africa	2,142	1,948
Middle East	1,187	1,109
South America	626	561
Information Systems	551	565
Corporate	205	186
	13,052	12,091

	Year-over-year percentage growth in:
	Airfreight kilos	Ocean freight FEUs
2011
January	13%	16%
February	12%	(9)%
March	21%	11%
Quarter	16%	7%

During the first quarter of 2011, the Company opened one satellite office in Kristiansand, Norway and closed one satellite office in Malmoe, Sweden.

Investors may submit written questions via e-mail to: [email protected]. Or by fax to: (206) 674-3459. Questions received by the end of business on May 6, 2011 will be considered in management’s 8-K “Responses to Selected Questions” expected to be filed on or about May 18, 2011.

Disclaimer on Forward-Looking Statements:

Certain portions of this release contain forward-looking statements which are based on certain assumptions and expectations of future events that are subject to risks and uncertainties, including comments on future ability to improve productivity and operating income, rising fuel costs, rising costs in general, global political unrest, volatile currency exchange rates, status of the US Dollar and our ability to help customers navigate through chaos and unexpected events. Actual future results and trends may differ materially from historical results or those projected in any forward-looking statements depending on a variety of factors including, but not limited to, our ability to maintain consistent and stable operating results, future success of our business model, ability to perpetuate profits, changes in customer demand for Expeditors’ services caused by a general economic slow-down, customers’ inventory build-up, decreased consumer confidence, volatility in equity markets, energy prices, political changes, regulatory changes or the unpredictable acts of competitors and other risks, risk factors and uncertainties detailed in our Annual Report filed with the Securities and Exchange Commission.

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except share data)
(Unaudited)


		March 31,		December 31,
	Assets	2011		2010

Current assets:
	Cash and cash equivalents	$	1,238,471	$	1,084,465
	Short-term investments		612		524
	Accounts receivable, net		1,006,980		1,003,884
	Deferred Federal and state income taxes		9,382		8,706
	Other current assets		25,380		42,776
	Total current assets		2,280,825		2,140,355

Property and equipment, net			514,429		498,648
Goodwill, net			7,927		7,927
Other intangibles, net			3,402		3,716
Other assets, net			30,149		28,533
		$	2,836,732	$	2,679,179
	Liabilities and Equity

Current liabilities:
	Accounts payable		687,988		652,161
	Accrued expenses, primarily salaries and related costs		182,391		177,869
	Federal, state and foreign income taxes		44,606		31,948
	Total current liabilities		914,985		861,978

Deferred Federal and state income taxes			72,627		69,047

Commitments and contingencies

Shareholders' equity:
	Preferred stock; none issued		--		--
	Common stock, par value $.01 per share; issued and outstanding 212,034,197 shares at March 31, 2011 and 212,047,774 shares at December 31, 2010		2,120		2,120
	Additional paid-in capital		14,350		13,412
	Retained earnings		1,808,481		1,717,249
	Accumulated other comprehensive income		16,958		8,125
	Total shareholders' equity		1,841,909		1,740,906

	Noncontrolling interest		7,211		7,248
	Total equity		1,849,120		1,748,154

		$	2,836,732	$	2,679,179

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Earnings
(In thousands, except share data)
(Unaudited)


		Three months ended
		March 31,
		2011			2010
Revenues:
Airfreight services		$	700,923		$	559,383
Ocean freight and ocean services			440,141			381,244
Customs brokerage and other services			319,784			260,482
	Total revenues		1,460,848			1,201,109

Operating expenses:
Airfreight consolidation			524,636			427,342
Ocean freight consolidation			339,549			301,090
Customs brokerage and other services			142,748			110,854
Salaries and related costs			237,815			199,848
Rent and occupancy costs			21,381			19,227
Depreciation and amortization			9,174			9,395
Selling and promotion			9,163			7,035
Other			29,152			25,777
	Total operating expenses		1,313,618			1,100,568

	Operating income		147,230			100,541

Interest income			2,320			1,775
Interest expense			(214	)		(87	)
Other, net			1,117			609
	Other income, net		3,223			2,297

Earnings before income taxes			150,453			102,838

Income tax expense			59,246			41,528

	Net earnings		91,207			61,310

Less: net (losses) earnings attributable to noncontrolling interest			(25	)		63

	Net earnings attributable to shareholders	$	91,232		$	61,247

Diluted earnings attributable to shareholders per share		$	0.42		$	0.28

Basic earnings attributable to shareholders per share		$	0.43		$	0.29

Weighted average diluted shares outstanding			215,863,386			216,630,436

Weighted average basic shares outstanding			212,088,860			212,192,710

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

			Three months ended
			March 31,
			2011			2010
Operating Activities:
Net earnings			$	91,207		$	61,310
Adjustments to reconcile net earnings to net cash provided by operating activities:
	Provision for losses on accounts receivable			1,853			2,443
	Deferred income tax benefit			(1,936	)		(7,728	)
	Excess tax benefits from stock plans			(2,246	)		(4,012	)
	Stock compensation expense			10,472			11,198
	Depreciation and amortization			9,174			9,395
	Gain on sale of assets			(30	)		(295	)
	Other			307			478
	Changes in operating assets and liabilities:
		Decrease (increase) in accounts receivable		6,683			(12,965	)
		Increase in other current assets		(1,415	)		(1,811	)
		Increase in accounts payable and accrued expenses		30,187			43,169
		Increase in income taxes payable, net		33,577			25,941
Net cash provided by operating activities				177,833			127,123

Investing Activities:
Increase in short-term investments				(89	)		(36	)
Purchase of property and equipment				(21,125	)		(7,582	)
Proceeds from sale of property and equipment				43			59
Other				(1,442	)		(188	)
Net cash used in investing activities				(22,613	)		(7,747	)

Financing Activities:
Proceeds from issuance of common stock				7,804			12,220
Repurchases of common stock				(19,584	)		(18,019	)
Excess tax benefits from stock plans				2,246			4,012
Net cash used in financing activities				(9,534	)		(1,787	)

Effect of exchange rate changes on cash and cash equivalents				8,320			(1,870	)

Increase in cash and cash equivalents				154,006			115,719

Cash and cash equivalents at beginning of period				1,084,465			925,929

Cash and cash equivalents at end of period			$	1,238,471		$	1,041,648

Interest and taxes paid:
Interest			$	4			87
Income taxes				26,276			19,996