Exhibit 99.1
C.H. Robinson Worldwide, Inc.
8100 Mitchell Road, Suite 200
Eden Prairie, Minnesota 55344
Chad Lindbloom, vp and chief financial officer (952) 937-7779
Angie Freeman, investor relations (952) 937-7847
FOR IMMEDIATE RELEASE
C.H. ROBINSON REPORTS THIRD QUARTER RESULTS
Income From Operations Up 21.8 Percent For the Quarter
MINNEAPOLIS, October 22, 2002 — C.H. Robinson Worldwide, Inc. (“C.H. Robinson”) (Nasdaq:CHRW), today reported financial results for the three months and nine months ended September 30, 2002.
For the third quarter of 2002, gross profits increased 8.7 percent to $123.1 million from $113.2 million in 2001. Income from operations increased 21.8 percent to $42.4 million from $34.8 million in 2001. Net income increased 14.7 percent to $26.0 million from $22.6 million in 2001. Basic net income per share increased 14.8 percent to $0.31 from $0.27 cents per share in 2001. Diluted net income per share increased 15.4 percent to $0.30 from $0.26 cents per share in 2001. The results from the third quarter of 2001 include other income of $2.0 million from unusual items, principally a gain on sale.
For the first nine months of 2002, gross profits increased 4.0 percent to $358.3 million from $344.5 million in 2001. Income from operations increased 16.4 percent to $117.2 million from $100.7 million in 2001. Net income increased 13.6 percent to $72.0 million from $63.4 million in 2001. Basic net income per share increased 13.3 percent to $0.85 from $0.75 cents per share in 2001. Diluted net income per share increased 13.5 percent to $0.84 from $0.74 cents per share in 2001. The results for the first nine months of 2001 include other income of $2.0 million from unusual items, principally a gain on sale.
“We’re encouraged that growth in our core truck business is strengthening,” said John P. Wiehoff, chief executive officer of C.H. Robinson. “Our other modes have performed well this year, and again contributed solid results. The flexibility of our business model continues to be an advantage, enabling us to react appropriately to changes in the marketplace and closely manage our operating expenses. We will continue to execute our long-term growth strategy and believe we are in a strong position for the future.”
For the third quarter, transportation gross profits increased 7.8 percent. All of our transportation modes grew this quarter. The increase in our truck transportation business of 5.2 percent was driven by volume growth, as gross profit per transaction declined due to rising costs of capacity. Intermodal, air and ocean growth was due to increased volume.
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C.H. Robinson Worldwide, Inc.
October 22, 2002
Page 2
For the third quarter, sourcing gross profits increased 8.2 percent. We continue to see increases in volume and gross profits with large retailers, offset by the trend of less volume with our traditional business with produce wholesalers.
For the third quarter, information services gross profits increased 27.2 percent, primarily due to significant transaction growth.
For the quarter, selling, general, and administrative expenses were $21.5 million, a decrease of 7.0 percent from $23.1 million in 2001. Amortization of certain intangible assets has been eliminated due to new accounting rules, which reduced amortization expense by $1.3 million in the third quarter. In addition, we had notable declines in communications costs and travel expenses.
Founded in 1905, C.H. Robinson Worldwide, Inc., is one of the largest third-party logistics companies in North America. C.H. Robinson is a global provider of multimodal transportation services and logistics solutions, serving 15,000 customers through a network of 146 offices in North America, South America, Europe and Asia. C.H. Robinson maintains the single largest network of motor carrier capacity in North America through contracts with more than 20,000 motor carriers, and is one of the largest third-party providers of intermodal services in the United States.
Except for the historical information contained herein, the matters set forth in this release are forward-looking statements which are based on certain assumptions and expectations of future events. These assumptions and expectations are dependent on and subject to certain risks and uncertainties including, but not limited to such factors as market demand, pricing, and risks associated with litigation and insurance coverage, and risks associated with operations outside of the U.S., changing economic conditions such as general economic slowdown and decreased consumer confidence, and other risk factors detailed under “Cautionary Statement” in Exhibit 99 to C.H. Robinson’s Annual Report on Form 10-K filed on March 15, 2002.
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C.H. Robinson Worldwide, Inc.
October 22, 2002
Page 3
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(In thousands, except per share data)
| | | Three months ended September 30,
| | | Nine months ended September 30,
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| | | 2002
| | | 2001
| | | 2002
| | | 2001
| |
| Gross revenues and management fees | | $ | 872,245 | | | $ | 784,517 | | | $ | 2,454,996 | | | $ | 2,313,695 | |
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| Gross profits: | | | | | | | | | | | | | | | | |
| Transportation: | | | | | | | | | | | | | | | | |
| Truck | | $ | 90,999 | | | $ | 86,516 | | | $ | 266,675 | | | $ | 263,682 | |
| Intermodal | | | 5,736 | | | | 4,053 | | | | 14,970 | | | | 11,647 | |
| Ocean | | | 4,339 | | | | 3,649 | | | | 12,479 | | | | 11,158 | |
| Air | | | 830 | | | | 538 | | | | 2,229 | | | | 1,993 | |
| Miscellaneous | | | 2,298 | | | | 1,924 | | | | 6,453 | | | | 5,302 | |
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| Total transportation | | | 104,202 | | | | 96,680 | | | | 302,806 | | | | 293,782 | |
| Sourcing | | | 12,105 | | | | 11,186 | | | | 36,447 | | | | 35,152 | |
| Information services | | | 6,777 | | | | 5,326 | | | | 18,998 | | | | 15,570 | |
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| Total gross profits | | | 123,084 | | | | 113,192 | | | | 358,251 | | | | 344,504 | |
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| Operating costs and expenses: | | | | | | | | | | | | | | | | |
| Personnel expenses | | | 59,234 | | | | 55,325 | | | | 176,754 | | | | 169,033 | |
| Selling, general and administrative | | | 21,486 | | | | 23,097 | | | | 64,324 | | | | 74,770 | |
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| Total operating costs and expenses | | | 80,720 | | | | 78,422 | | | | 241,078 | | | | 243,803 | |
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| Income from operations | | | 42,364 | | | | 34,770 | | | | 117,173 | | | | 100,701 | |
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| Investment and other income: | | | | | | | | | | | | | | | | |
| Interest income and other | | | 422 | | | | 2,685 | | | | 1,343 | | | | 3,961 | |
| NQDC investment loss | | | (242 | ) | | | (177 | ) | | | (483 | ) | | | (208 | ) |
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| Total investment and other income | | | 180 | | | | 2,508 | | | | 860 | | | | 3,753 | |
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| Income before provision for income taxes | | | 42,544 | | | | 37,278 | | | | 118,033 | | | | 104,454 | |
| Provision for income taxes | | | 16,593 | | | | 14,650 | | | | 46,034 | | | | 41,050 | |
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| Net income | | $ | 25,951 | | | $ | 22,628 | | | $ | 71,999 | | | $ | 63,404 | |
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| Net income per share (basic) | | $ | 0.31 | | | $ | 0.27 | | | $ | 0.85 | | | $ | 0.75 | |
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| Net income per share (diluted) | | $ | 0.30 | | | $ | 0.26 | | | $ | 0.84 | | | $ | 0.74 | |
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| Weighted average shares outstanding (basic) | | | 84,292 | | | | 84,294 | | | | 84,302 | | | | 84,339 | |
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| Weighted average shares outstanding (diluted) | | | 85,500 | | | | 85,694 | | | | 85,731 | | | | 85,776 | |
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C.H. Robinson Worldwide, Inc.
October 22, 2002
Page 4
CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)
| | | September 30, 2002 (unaudited)
| | December 31, 2001
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| Assets | | | | | | |
| Current assets: | | | | | | |
| Cash and cash equivalents | | $ | 121,624 | | $ | 115,741 |
| Investments | | | 25,098 | | | — |
| Receivables | | | 398,036 | | | 370,378 |
| Other current assets | | | 17,706 | | | 17,096 |
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| Total current assets | | | 562,464 | | | 503,215 |
| Net property and equipment | | | 27,848 | | | 30,920 |
| Intangible and other assets | | | 161,916 | | | 149,355 |
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| | | $ | 752,228 | | $ | 683,490 |
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| Liabilities and stockholders’ investment | | | | | | |
| Current liabilities: | | | | | | |
| Accounts payable | | $ | 283,780 | | $ | 267,708 |
| Accrued compensation | | | 29,432 | | | 32,098 |
| Other accrued expenses | | | 23,810 | | | 23,722 |
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| Total current liabilities | | | 337,022 | | | 323,528 |
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| Long term liabilities: | | | | | | |
| Deferred tax liability | | | 5,023 | | | 3,241 |
| Nonqualified deferred compensation obligation | | | 1,450 | | | 906 |
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| Total long term liabilities | | | 6,473 | | | 4,147 |
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| Total liabilities | | | 343,495 | | | 327,675 |
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| Total stockholders’ investment | | | 408,733 | | | 355,815 |
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| | | $ | 752,228 | | $ | 683,490 |
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C.H. Robinson Worldwide, Inc.
October 22, 2002
Page 5
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
(In thousands, except operational data)
| | | Nine months ended September 30,
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| | | 2002
| | | 2001
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| Operating activities: | | | | | | | | |
| Net income | | $ | 71,999 | | | $ | 63,404 | |
| Depreciation and amortization | | | 10,661 | | | | 14,417 | |
| Other non-cash expenses | | | 2,131 | | | | 9,006 | |
| Net changes in operating elements | | | (12,332 | ) | | | (50,170 | ) |
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| Net cash provided by operating activities | | | 72,459 | | | | 36,657 | |
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| Investing activities: | | | | | | | | |
| Net property additions | | | (5,924 | ) | | | (10,296 | ) |
| Cash paid for acquisition | | | (15,716 | ) | | | — | |
| Net purchases of investments | | | (25,098 | ) | | | — | |
| Other assets, net | | | (1,086 | ) | | | (1,136 | ) |
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| Net cash used for investing activities | | | (47,824 | ) | | | (11,432 | ) |
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| Financing activities: | | | | | | | | |
| Net repurchases of common stock | | | (3,551 | ) | | | (5,907 | ) |
| Cash dividends | | | (15,201 | ) | �� | | (12,678 | ) |
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| Net cash used for financing activities | | | (18,752 | ) | | | (18,585 | ) |
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| Net increase in cash | | | 5,883 | | | | 6,640 | |
| Cash and cash equivalents, beginning of period | | | 115,741 | | | | 79,912 | |
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| Cash and cash equivalents, end of period | | $ | 121,624 | | | $ | 86,552 | |
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| | | As of September 30,
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| Operational data: | | 2002
| | 2001
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| Employees | | 3,751 | | 3,727 |
| Branches | | 146 | | 139 |
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