RANCHO DOMINGUEZ, Calif., Dec. 7, 2004 (PRIMEZONE) -- UTi Worldwide Inc. (Nasdaq:UTIW) today reported increases in gross and net revenues and net income for the three- and nine-month periods ended October 31, 2004 compared with year-earlier results.
Gross revenues for the fiscal 2005 third quarter rose 51 percent to $602.5 million from $398.7 million in the corresponding prior-year period. Net revenues grew 29 percent to $202.0 million from $156.5 million a year earlier. Revenue growth for the fiscal 2005 period reflects improved performance across all service categories.
Comparing the 2005 fiscal third quarter to the same period in fiscal 2004, UTi posted a 28 percent increase in airfreight forwarding net revenues; a 32 percent rise in ocean freight forwarding net revenues; and growth of 32 percent in contract logistics net revenues.
Operating income rose 49 percent to $26.7 million in the current fiscal third quarter from $18.0 million in the corresponding year-earlier period. Operating income as a percent of net revenues increased by 170 basis points to 13.2 percent in the current fiscal third quarter when compared to the prior-year third fiscal quarter.
"UTi's performance in the third quarter is indicative of the balanced strength of our operations throughout the world," said Roger I. MacFarlane, chief executive officer of UTi Worldwide. "The operating improvement reflects the company's continued focus on operational productivity and increasing network density to improve operating profit margin.
"After 11 quarters of our 20-quarter NextLeap strategic initiative, the UTi team continues to realize the benefit of our focus on meeting customers' evolving needs. Our results underscore UTi's success at becoming the primary logistics partner to more of our global customers and as a provider of outsourced solutions in global integrated logistics," MacFarlane said.
UTi's global network also achieved gross and net revenue gains, as well as operating income improvements over the prior-year third quarter across all geographic regions. Asia Pacific, the largest contributor to gross revenues in the fiscal 2005 third quarter, achieved gains as Asian exports to all the world's regions continued to expand. The company's Europe region saw continued improvement with a 37% increase in both gross and net revenues, and productivity gains led to an almost doubling of operating income in this region. The Americas region experienced growth in freight forwarding exports and imports. In the Americas, the company completed its acquisition of specialty contract logistics provider, Unigistix Inc., during the last month of the quarter. Net revenues grew fastest in the Africa region, bolstered by a full quarter's contribution from International Healthcare Distributors Ltd. (IHD), which UTi acquired in June 2004.
Net income for the fiscal 2005 third quarter advanced 51 percent to $19.9 million, or $0.62 per diluted share, from $13.2 million, or $0.42 per diluted share, in the fiscal 2004 third quarter.
For the nine-month period ended October 31, 2004, gross revenues advanced 50 percent to $1.6 billion from $1.1 billion for the same period a year ago. Net revenues rose 29 percent to $558.5 million, up from $432.8 million in the comparable prior-year period. Operating income for the current nine-month period totaled $69.0 million, up 56 percent from $44.1 million in the first nine months of the comparable prior-year period. Operating margin (operating income as a percentage of net revenues) rose to 12.3 percent in the current nine-month period, compared with 10.2 percent a year ago. Net income for the fiscal 2005 nine-month period increased 50 percent to $48.9 million, or $1.52 per diluted share, from $32.6 million, or $1.04 per diluted share, in the corresponding period a year ago.
At October 31, 2004, the company reported total cash and cash equivalents, net of outstanding bank lines of credit and short-term bank borrowings, of $26.6 million, compared with $137.2 million at January 31, 2004. This decrease stems principally from the acquisitions of Unigistix and IHD and from the increase in working capital requirements to fund the scale of revenue growth achieved in the third quarter. Historically, prior fourth fiscal quarters have generally had lower working capital needs than third fiscal quarters.
"As we enter the fourth fiscal quarter, which includes the low freight months of December and January, our UTi team's uncompromising dedication to meeting our customers' needs and improving operating performance bolsters our confidence that UTi will close out fiscal 2005 well positioned for the opportunities and challenges ahead," MacFarlane added. "Nevertheless, we remain cognizant of the increased costs associated with implementation of Sarbanes-Oxley requirements as well as our investment in the development and roll-out of our new supply chain technology solution, eMpower5."
Investor Conference Call
UTi management will host an investor conference call today, Tuesday, December 7, 2004, at 8:00 a.m. PST (11:00 a.m. EST) to review the company's financials and operations for the third quarter ended October 31, 2004. The call will be open to all interested investors through a live, listen-only audio Web broadcast via the Internet at www.go2uti.com and www.fulldisclosure.com. For those who are not available to listen to the live broadcast, the call will be archived for one year at both Web sites. A telephonic playback of the conference call also will be available from approximately 10:00 a.m. PST, Tuesday, December 7, through 5:00 p.m. PST, Friday, December 10, by calling 888-286-8010 (domestic) or 617-801-6888 (international) and using Reservation No. 57891971.
About UTi Worldwide
UTi Worldwide Inc. is an international, non-asset based global integrated logistics company providing air and ocean freight forwarding, contract logistics, customs brokerage and other supply chain management services. The company serves a large and diverse base of global and local companies, including customers operating in industries with unique supply chain requirements such as the pharmaceutical, apparel, chemical, automotive and technology industries. The company seeks to use its global network, proprietary information technology systems, relationships with transportation providers and expertise in outsourced logistics services to deliver competitive advantage to each of its customers' global supply chains.
Safe Harbor Statement
Certain statements in this news release may be deemed to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The company intends that all such statements be subject to the "safe-harbor" provisions contained in those sections. Such statements may include, but are not limited to, the company's discussion of its ability to meet customers' needs; its role as a primary logistics partner and outsourced solution for global integrated logistics; its expectations for working capital needs, free cash flow, operating performance and delivery of new products; its growth strategy and integration of acquisitions. Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements, including increased competition; integration risks associated with acquisitions; the effects of changes in foreign exchange rates; changes in the company's effective tax rates; industry consolidation making it more difficult to compete against larger companies; uncertainties and risks associated with the company's operations in South Africa; general economic, political and market conditions, including those in Africa, Asia and Europe; risks of international operations; the success and effects of new strategies, disruptions caused by epidemics, conflicts, wars and terrorism; and the other risks and uncertainties described in the company's filings with the Securities and Exchange Commission. Although UTi believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the results contemplated in forward-looking statements will be realized. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by UTi or any other person that UTi's objectives or plans will be achieved. The historical results achieved by the company are not necessarily indicative of its future prospects. UTi undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
# # #
(Tables Follow)
UTi Worldwide Inc.
Condensed Consolidated Income Statements
(in thousands, except share and per share amounts)
Three months ended Nine months ended
October 31, October 31,
------------------------- -------------------------
2004 2003 2004 2003
------------ ------------ ------------ ------------
(Unaudited)
Gross revenues:
Airfreight
forwarding $ 271,445 $ 195,149 $ 742,879 $ 522,201
Ocean freight
forwarding 183,501 93,319 480,276 256,230
Customs
brokerage 20,479 17,189 57,333 49,430
Contract
logistics 83,432 61,447 229,592 169,355
Other 43,646 31,622 122,410 90,323
------------ ------------ ------------ ------------
Total gross
revenues $ 602,503 $ 398,726 $ 1,632,490 $ 1,087,539
============ ============ ============ ============
Net revenues:
Airfreight
forwarding $ 67,093 $ 52,230 $ 184,946 $ 145,376
Ocean freight
forwarding 25,317 19,114 71,525 54,103
Customs
brokerage 19,821 17,370 55,558 47,818
Contract
logistics 67,082 50,668 184,087 141,185
Other 22,706 17,163 62,395 44,341
------------ ------------ ------------ ------------
Total net
revenues 202,019 156,545 558,511 432,823
Staff costs 102,236 81,206 289,500 231,760
Depreciation
and
amortization 4,950 3,531 13,475 10,750
Amortization of
intangible
assets 435 178 865 484
Other operating
expenses 67,655 53,657 185,713 145,725
------------ ------------ ------------ ------------
Operating income 26,743 17,973 68,958 44,104
Interest income,
net 328 458 627 967
Losses on
foreign exchange (3) (336) (26) (12)
------------ ------------ ------------ ------------
Pretax income 27,068 18,095 69,559 45,059
Provision for
income taxes (6,548) (4,419) (18,970) (11,173)
------------ ------------ ------------ ------------
Income before
minority
interests 20,520 13,676 50,589 33,886
Minority
interests (610) (498) (1,672) (1,318)
------------ ------------ ------------ ------------
Net income $ 19,910 $ 13,178 $ 48,917 $ 32,568
============ ============ ============ ============
Basic earnings
per ordinary
share $ 0.65 $ 0.43 $ 1.59 $ 1.08
Diluted earnings
per ordinary
share $ 0.62 $ 0.42 $ 1.52 $ 1.04
Number of
weighted-average
shares
outstanding used
for per share
calculations:
Basic shares 30,760,187 30,301,508 30,688,019 30,236,777
Diluted
shares 32,322,468 31,539,692 32,137,143 31,392,561
UTi Worldwide Inc.
Condensed Consolidated Balance Sheets
(in thousands)
October 31, January 31,
2004 2004
--------- ---------
(Unaudited)
ASSETS
Cash and cash equivalents $ 124,340 $ 156,687
Trade receivables, net 438,638 280,044
Deferred income tax
assets 6,951 6,534
Other current assets 46,393 33,420
--------- ---------
Total current assets 616,322 476,685
Property, plant and
equipment, net 72,292 54,421
Goodwill and other
intangible assets, net 280,962 158,567
Investments 1,133 1,117
Deferred income tax
assets 2,444 2,384
Other non-current assets 10,146 10,167
--------- ---------
Total assets $ 983,299 $ 703,341
========= =========
LIABILITIES &
SHAREHOLDERS' EQUITY
Bank lines of credit $ 96,002 $ 18,180
Short-term borrowings 1,727 1,312
Current portion of
capital lease
obligations 2,727 2,408
Trade payables and other
accrued liabilities 389,053 269,072
Income taxes payable 18,897 10,864
Deferred income tax
liabilities 68 256
--------- ---------
Total current
liabilities 508,474 302,092
Long-term borrowings 1,547 93
Capital lease obligations 9,176 7,326
Deferred income tax
liabilities 9,841 3,860
Retirement fund
obligations 1,363 1,251
Minority interests 2,655 2,873
Commitments and
contingencies
Shareholders' equity:
Common stock 323,518 318,409
Retained earnings 151,209 105,855
Accumulated other
comprehensive loss (24,484) (38,418)
--------- ---------
Total shareholders'
equity 450,243 385,846
--------- ---------
Total liabilities and
shareholders' equity $ 983,299 $ 703,341
========= =========
UTi Worldwide Inc.
Consolidated Statements of Cash Flows
(in thousands)
Nine months ended
October 31,
---------------------
2004 2003
--------- ---------
(Unaudited)
OPERATING ACTIVITIES:
Net income $ 48,917 $ 32,568
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Stock compensation
costs 300 130
Depreciation and
amortization 13,475 10,750
Amortization of
intangible assets 865 484
Deferred income taxes 1,398 1,009
Tax benefit relating
to exercise of stock
options 1,101 --
(Gain)/loss on disposal
of property, plant and
equipment (228) 194
Other 1,672 1,318
Changes in operating
assets and liabilities:
Increase in trade
receivables and other
current assets (139,031) (40,113)
Increase in trade
payables and other
current liabilities 86,852 30,271
--------- ---------
Net cash provided by
operating activities 15,321 36,611
INVESTING ACTIVITIES:
Purchases of property,
plant and equipment (15,110) (13,759)
Proceeds from disposal of
property, plant and
equipment 2,276 584
Increase in other
non-current assets (1,020) (794)
Acquisitions of
subsidiaries and
contingent earn-out
payments (118,476) (14,269)
Other (680) (444)
--------- ---------
Net cash used in
investing activities (133,010) (28,682)
FINANCING ACTIVITIES:
Increase in bank lines of
credit 77,822 893
Decrease in short-term
borrowings (1,068) (6,368)
Long-term borrowings --
advanced 1,642 --
Long-term borrowings --
repaid (192) (130)
Repayments of capital
lease obligations (2,952) (2,608)
Decrease in minority
interests (410) (338)
Net proceeds from
issuance of ordinary
shares 3,708 2,523
Dividends paid (3,563) (2,890)
--------- ---------
Net cash provided by/
(used in) financing
activities 74,987 (8,918)
--------- ---------
Net decrease in cash and
cash equivalents (42,702) (989)
Cash and cash equivalents
at beginning of period 156,687 168,125
Effect of foreign
exchange rate changes 10,355 (1,246)
--------- ---------
Cash and cash equivalents
at end of period $ 124,340 $ 165,890
========= =========
UTi Worldwide Inc.
Segment Reporting
(in thousands)
Three months ended October 31, 2004
------------------------------------------------------
(Unaudited)
Asia
Europe Americas Pacific Africa Corporate Total
-------- -------- -------- -------- -------- --------
Gross
revenue
from
external
customers $144,134 $149,962 $191,428 $116,979 $ -- $602,503
======== ======== ======== ======== ======== ========
Net revenue $ 43,600 $ 72,631 $ 30,202 $ 55,586 $ -- $202,019
Staff costs 23,786 40,547 11,463 24,356 2,084 102,236
Depreciation
and
amortization 1,289 889 632 1,727 413 4,950
Amortization
of
intangible
assets -- 263 -- 172 -- 435
Other
operating
expenses 12,524 23,981 7,227 21,558 2,365 67,655
-------- -------- -------- -------- -------- --------
Operating
income/
(loss) $ 6,001 $ 6,951 $ 10,880 $ 7,773 $ (4,862) 26,743
======== ======== ======== ======== ========
Interest
income,
net 328
Losses on
foreign
exchange (3)
--------
Pretax
income 27,068
Provision
for
income
taxes (6,548)
--------
Income
before
minority
interests $ 20,520
========
Three months ended October 31, 2003
------------------------------------------------------
(Unaudited)
Asia
Europe Americas Pacific Africa Corporate Total
-------- -------- -------- -------- -------- ---------
Gross
revenue
from
external
customers $104,961 $119,629 $118,309 $ 55,827 $ -- $398,726
======== ======== ======== ======== ======== ========
Net revenue $ 31,882 $ 66,221 $ 23,543 $ 34,899 $ -- $156,545
Staff costs 18,367 37,343 9,547 14,871 1,078 81,206
Depreciation
and
amortization 1,085 990 476 787 193 3,531
Amortization
of
intangible
assets -- 149 -- 29 -- 178
Other
operating
expenses 9,346 22,807 5,693 14,260 1,551 53,657
-------- -------- -------- -------- -------- --------
Operating
income/
(loss) $ 3,084 $ 4,932 $ 7,827 $ 4,952 $ (2,822) 17,973
======== ======== ======== ======== ========
Interest
income,
net 458
Losses on
foreign
exchange (336)
--------
Pretax
income 18,095
Provision
for income
taxes (4,419)
--------
Income
before
minority
interests $ 13,676
========
UTi Worldwide Inc.
Segment Reporting
(in thousands)
Nine months ended October 31, 2004
------------------------------------------------------------
(Unaudited)
Asia
Europe Americas Pacific Africa Corporate Total
--------- --------- --------- --------- --------- ----------
Gross
revenue
from
external
cust-
omers $ 429,219 $ 411,733 $ 490,714 $ 300,824 $ -- $1,632,490
========= ========= ========= ========= ========= ==========
Net
revenue $ 128,113 $ 209,306 $ 79,544 $ 141,548 $ -- $ 558,511
Staff costs 68,369 121,166 32,167 62,154 5,644 289,500
Depreciation
and
amortization 3,717 2,566 1,807 4,098 1,287 13,475
Amortization
of
intangible
assets -- 546 -- 319 -- 865
Other
operating
expenses 36,534 67,833 19,860 55,108 6,378 185,713
--------- --------- --------- --------- --------- ---------
Operating
income/
(loss) $ 19,493 $ 17,195 $ 25,710 $ 19,869 $ (13,309) 68,958
========= ========= ========= ========= =========
Interest
income,
net 627
Losses on
foreign
exchange (26)
---------
Pretax
income 69,559
Provision
for
income
taxes (18,970)
---------
Income
before
minority
interests $ 50,589
=========
Nine months ended October 31, 2003
----------------------------------------------------------
(Unaudited)
Asia
Europe Americas Pacific Africa Corporate Total
--------- --------- --------- --------- --------- ----------
Gross
revenue
from
external
cust-
omers $ 308,329 $ 337,024 $ 298,311 $ 143,875 $ -- $1,087,539
========= ========= ========= ========= ========= ==========
Net
revenue $ 90,879 $ 188,667 $ 63,801 $ 89,476 $ -- $ 432,823
Staff
costs 52,750 109,031 26,607 39,659 3,713 231,760
Depreciation
and
amortization 3,200 2,992 1,538 2,191 829 10,750
Amortization
of
intangible
assets -- 446 -- 38 -- 484
Other
operating
expenses 27,037 63,833 16,012 34,821 4,022 145,725
--------- --------- --------- --------- -------- ----------
Operating
income/
(loss) $ 7,892 $ 12,365 $ 19,644 $ 12,767 $ (8,564) 44,104
========= ========= ========= ========= ========
Interest
income,
net 967
Losses on
foreign
exchange (12)
----------
Pretax
income 45,059
Provision
for income
taxes (11,173)
----------
Income
before
minority
interests $ 33,886
==========
UTi Worldwide Inc.
Supplemental Financial Information
(in thousands)
Three months ended Nine months ended
October 31, October 31,
--------------------- ---------------------
2004 2003 2004 2003
---------- ---------- ---------- ----------
(Unaudited)
Forwarding, Customs
Brokerage & Other:
Gross revenue from
external customers $ 496,099 $ 320,033 $1,335,889 $ 866,256
========== ========== ========== ==========
Net revenue $ 118,800 $ 93,524 $ 328,941 $ 258,765
Staff costs 58,870 48,179 166,038 136,588
Depreciation and
amortization 2,739 2,349 7,952 7,106
Other operating
expenses 34,686 27,386 95,285 73,356
---------- ---------- ---------- ----------
Operating income $ 22,505 $ 15,610 $ 59,666 $ 41,715
========== ========== ========== ==========
Contract Logistics,
Distribution
& Other:
Gross revenue from
external customers $ 106,404 $ 78,693 $ 296,601 $ 221,283
========== ========== ========== ==========
Net revenue $ 83,219 $ 63,021 $ 229,570 $ 174,058
Staff costs 41,282 31,949 117,818 91,459
Depreciation and
amortization 1,798 989 4,236 2,815
Amortization of
intangible assets 435 178 865 484
Other operating
expenses 30,604 24,720 84,050 68,347
---------- ---------- ---------- ----------
Operating income $ 9,100 $ 5,185 $ 22,601 $ 10,953
========== ========== ========== ==========