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C.H. Robinson (CHRW) Q2 Earnings Surpass Estimates, Rise Y/Y

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C.H. Robinson Worldwide’s (CHRW - Free Report) second-quarter 2022 earnings of $2.67 per share surpassed the Zacks Consensus Estimate of $1.93. Moreover, the bottom line surged 85.4% year over year. Strong performance of CHRW’s truckload and less-than-truckload (LTL) businesses aided results.

Total revenues of $6,798.5 million outperformed the Zacks Consensus Estimate of $6,717.7 million. The top line jumped 22.9% year over year owing to favorable pricing across most of CHRW’s services, and higher truckload and ocean volume.

Total operating expenses increased 15% year over year to $561.9 million due to higher personnel, and incentive and compensation expenses. Adjusted gross profit climbed 37.7% year over year to $1 billion, primarily owing to higher volumes and an increased adjusted gross profit per transaction.

C.H. Robinson returned $409.2 million to its shareholders in the second quarter through a combination of cash dividends ($72.4 million) and share repurchases ($336.7 million). Capital expenditures totaled $43.2 million in the quarter under review. CHRW now expects capital expenditures in the band of $110-$120 million for 2022 (earlier expectation: $90-$100 million). The increased guidance is due to a higher level of internally developed software.

Segmental Results

At North American Surface Transportation (NAST), total revenues were $4.1 billion (up 15.71% year over year) in the second quarter. Segmental revenues benefited from higher truckload and LTL pricing as well as increased truckload shipments. Adjusted gross profit at the segment ascended 43.1%, driven by a 50.8% increase in truckload adjusted gross profit, which was aided by higher adjusted gross profit per load and expanded truckload volumes.

Total revenues at Global Forwarding were $2.1 billion, up more than 44.3% year over year. Results were boosted by higher pricing and volume in CHRW’s ocean services. This upbeat scenario is reflective of the strong demand scenario. Adjusted gross profit at the segment surged 50.1% year over year.

Revenues from other sources (Robinson Fresh, Managed Services and Other Surface Transportation) increased 12.4% to $558.2 million.

Below we present the division of adjusted profit among the service lines (on an enterprise basis).

Transportation: The unit (comprising Truckload, Intermodal, LTL, Ocean, Air, Customs and Other logistics services) delivered an adjusted gross profit of $998.7 million in the quarter under consideration, up 38.5% from the prior-year figure.

Adjusted gross profit at the Truckload sub-group climbed 48.1% year over year to $456.2 million. LTL adjusted gross profit increased 29.6% year over year to $168.3 million.

Adjusted gross profit at the Ocean transportation segment jumped 51% year over year to $227.9 million. The same at the air transportation sub-group climbed 7.2% to $56.8 million. Customs-adjusted gross profit augmented 9% to $27.8 million.

Other logistics services’ adjusted gross profit rose 14.7 % to $61.6 million.

Sourcing: Adjusted gross profit at the segment increased 17.2% to $32.8 million.

Balance-Sheet Data

This presently Zacks Rank #2 (Buy) player exited the June quarter with cash and cash equivalents of $238.9 million compared with $257.4 million at the end of December 2021. Long-term debt was $1.59 billion compared with $1.39 billion at the end of 2021. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Earnings Snapshots

Within the broader Transportation sector, J.B. Hunt Transport Services (JBHT - Free Report) , CSX Corporation (CSX - Free Report) and United Airlines (UAL - Free Report)  recently reported second-quarter 2022 results.

J.B. Hunt reported better-than-expected second-quarter 2022 results, wherein both earnings and revenues outperformed the Zacks Consensus Estimate.

Quarterly earnings of $2.42 per share surpassed the Zacks Consensus Estimate of $1.61 and improved 50.3% year over year. Total operating revenues of $3,837.53 million also outperformed the Zacks Consensus Estimate of $2,908.37 million. The top line jumped 32% year over year on the back of strength across all segments. Total operating revenues, excluding fuel surcharges, rose 21.2% year over year.

Quarterly operating income (on a reported basis) climbed 46.2% to $353.08 million on higher volumes, customer rate and cost-recovery efforts. Operating expenses escalated 30.6% to $3.48 billion.

CSX reported better-than-expected second-quarter 2022 results, wherein both earnings and revenues outperformed the Zacks Consensus Estimate.

Quarterly earnings of 50 cents per share (excluding 4 cents from non-recurring items) beat the Zacks Consensus Estimate of 47 cents and improved 25% year over year.

Total revenues of $3,815 million outperformed the Zacks Consensus Estimate of $3,642.2 million. The top line increased 28% year over year on the back of higher revenues in almost all markets, driven by pricing gains, fuel surcharge and contribution from the acquisition of Quality Carriers. Overall revenues per unit increased 27%.

United Airlines’ second-quarter 2022 earnings (excluding 43 cents from non-recurring items) of $1.43 per share fell short of the Zacks Consensus Estimate of $1.86. Escalated operating expenses induced the earnings miss.

The second quarter of 2022 was the first profitable period at UAL since the onset of the pandemic. Operating revenues at United Airlines came in at $12,112 million, beating the Zacks Consensus Estimate of $12,033.7 million.