UTi Worldwide posts lower 1Q earnings

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UTi Worldwide Inc. today, June 4, reported financial results for its fiscal 2010 first quarter ended April 30. The company said results were impacted adversely by continued weak freight and logistics volumes, partially offset by lower transportation and operating costs.

Fiscal 1Q 2010 vs. 2009 results:

  • Revenues decreased 35 percent to $768.4 million from $1,184.5 million;
  • Net revenues (revenues minus purchased transportation costs) decreased 21 percent to $309.5 million from $389.5 million;
  • Operating income decreased 25 percent to $17.9 million from $23.7 million; and
  • Net income attributable to UTi Worldwide Inc. was $9.8 million compared to $13.5 million.
  • “Results in the first quarter continued to be impacted by the macroeconomic conditions and lower-than-expected transportation and logistics volumes,” said Eric W. Kirchner, chief executive officer of UTi Worldwide, based in Long Beach, Calif. “Purchased transportation costs also decreased, mitigating to some extent the volume deterioration. We continued to respond to the volume declines by reducing our operating costs, although these reductions did not fully offset the decrease in net revenue. We are intensifying our sales efforts to improve revenue growth, particularly in freight forwarding, without sacrificing profitability. These efforts may take some time, but we remain fully committed to our goal of achieving long-term growth and margin improvement.”

    The company said the decrease in revenues was due to the significant decline in forwarding and logistics volumes, currency fluctuations and the exiting of businesses last year through its earlier cost reduction plan.