LONG BEACH, Calif., June 7, 2007 (PRIME NEWSWIRE) -- UTi Worldwide Inc. (Nasdaq:UTIW) today reported increases in gross and net revenues of 22 percent and 24 percent, respectively, for its first quarter ended April 30, 2007.
For the first quarter of fiscal 2008, gross revenues totaled $944.7 million, compared with $773.7 million in the prior-year first quarter. Net revenues rose to $336.0 million for the first quarter of fiscal 2008 from $271.6 million in the first quarter a year ago. Organic growth across all geographic regions, as well as contributions from the company's acquisitions made since February 1, 2006, contributed to the first quarter revenue gains. After adjusting for the impact of these acquisitions, as well as the impact of currency fluctuations on UTi's results, gross and net revenues grew organically by 13 percent and 15 percent, respectively, in the fiscal 2008 first quarter, when compared with the corresponding period a year ago.
"Our first quarter financial results were right on plan and we remain pleased with the consistent levels of organic revenue growth being delivered by UTi's team worldwide," said Roger I. MacFarlane, chief executive officer of UTi Worldwide. "During the quarter we made important progress on all areas of focus. We remain committed to driving both improved cost management and organic revenue growth. We have reduced the number of initiatives in the company while maintaining our efforts to enhance on the value of our global supply chain services and solutions."
Operating income in the first quarter of fiscal 2008 was $31.4 million, versus $30.0 million in the fiscal 2007 first quarter. The company posted net income of $18.1 million, or $0.18 per diluted share, for the fiscal 2008 first quarter. This compares with $19.3 million, or $0.20 per diluted share, in the fiscal 2007 first quarter.
"We are excited to embark on our new five year strategic plan, CLIENTasONE, which builds on the success of NextLeap. We are confident that this next phase of our long-term strategy will continue to provide enhanced value to our clients and shareholders over the next five years and beyond," MacFarlane said.
Guidance
The company confirmed its previously stated fiscal 2008 full-year earnings per share guidance in the range of $1.14 to $1.22 cents per diluted share. The company also reiterated its position that the giving of guidance for fiscal 2008 is not an indication of a change in practice in regards to providing guidance in future years.
Investor Conference Call
UTi management will host an investor conference call today, June 7, 2007, at 8:00 a.m. PDT (11:00 a.m. EDT) to review the company's financials and operations for the fiscal 2008 first quarter. The call will be open to all interested investors through a live, listen-only audio Internet broadcast at www.go2uti.com and www.earnings.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 11:00 a.m. PDT, today, through June 14, 2007 by calling 888-286-8010 (domestic) or 617-801-6888 (international) and using replay passcode 29358239.
About UTi Worldwide
UTi Worldwide Inc. is an international, non-asset-based supply chain services and solutions company providing air and ocean freight forwarding, contract logistics, customs brokerage, distribution, inbound logistics, truckload brokerage and other supply chain management services. The company serves a large and diverse base of global and local companies, including clients operating in industries with unique supply chain requirements such as the pharmaceutical, retail, 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 clients' supply chains.
Use of Non-GAAP Financial Information
This press release includes "non-GAAP financial measures" within the meaning of the Securities and Exchange Commission rules. We believe that meaningful analysis of our financial performance requires an understanding of the factors underlying that performance and our judgments about the likelihood that particular factors will repeat. Short-term patterns and long-term trends may be obscured by the impact of certain items. For this reason, we have referred to gross and net revenue growth adjusted to exclude the impact of acquisitions made since the beginning of the comparative period, and the impact of changes in the translation of foreign currencies into U.S. dollars. This information is among the information the company uses as a basis for evaluating company performance on a comparable basis over time, allocating resources and planning and forecasting of future periods. This information is not intended to be considered in isolation or as a substitute for gross and net revenue growth calculated in accordance with GAAP.
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 NextLeap goals and journey, the company's discussion of CLIENTasONE, the company's long-term strategy, and the company's discussion of its financial goals, including but not limited to margin improvement. Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements, including integration risks associated with acquisitions, the ability to retain customers and management of acquisition targets; a challenging operating environment; increased competition; the impact of higher fuel costs; 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; general economic, political and market conditions, including those in Africa, Asia and Europe; work stoppages or slowdowns or other material interruptions in transportation services; 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, we cannot assure you that the results contemplated in forward-looking statements will be realized in the timeframe anticipated or at all. 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. Accordingly, investors are cautioned not to place undue reliance on our forward-looking statements. UTi undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
UTi Worldwide Inc. Condensed Consolidated Income Statement (in thousands, except share and per share amounts) Three months ended April 30, ----------------------------- 2007 2006 ------------ ------------ (Unaudited) Gross revenues: Airfreight forwarding $ 344,146 $ 307,570 Ocean freight forwarding 232,290 206,533 Customs brokerage 21,883 19,805 Contract logistics 141,515 109,161 Distribution 118,849 77,796 Other 86,055 52,835 ------------ ------------ Total gross revenues $ 944,738 $ 773,700 ============ ============ Net revenues: Airfreight forwarding $ 85,246 $ 74,889 Ocean freight forwarding 36,975 31,529 Customs brokerage 21,158 19,159 Contract logistics 121,742 93,093 Distribution 35,513 29,018 Other 35,407 23,940 ------------ ------------ Total net revenues 336,041 271,628 Staff costs 184,717 147,883 Depreciation and amortization 9,387 7,436 Amortization of intangible assets 1,985 1,851 Other operating expenses 108,534 84,476 ------------ ------------ Operating income 31,418 29,982 Interest expense, net (4,091) (2,867) (Losses)/gains on foreign exchange (368) 185 ------------ ------------ Pretax income 26,959 27,300 Provision for income taxes 7,967 7,094 ------------ ------------ Income before minority interests 18,992 20,206 Minority interests (872) (882) ------------ ------------ Net income (1) $ 18,120 $ 19,324 ============ ============ Basic earnings per share $ 0.18 $ 0.20 Diluted earnings per share $ 0.18 $ 0.20 Number of weighted-average shares outstanding used for per share calculations: Basic shares 98,695,869 95,481,624 Diluted shares 100,209,000 99,027,366 (1) In connection with our December 2006 restatement, net income for the three months ended April 30, 2006 was increased by $2,732 of non-cash items. UTi Worldwide Inc. Condensed Consolidated Balance Sheets (in thousands) April 30, January 31, 2007 2007 ------------ ------------ (Unaudited) ASSETS Cash and cash equivalents $ 224,648 $ 278,408 Trade receivables, net 721,484 662,804 Deferred income tax assets 12,735 10,889 Other current assets 62,499 57,563 ------------ ------------ Total current assets 1,021,366 1,009,664 Property, plant and equipment, net 130,782 127,990 Goodwill and other intangible assets, net 501,490 490,884 Investments 3,933 3,096 Deferred income tax assets 11,674 12,725 Other non-current assets 17,196 15,511 ------------ ------------ Total assets $ 1,686,441 $ 1,659,870 ============ ============ LIABILITIES & SHAREHOLDERS' EQUITY Bank lines of credit $ 68,244 $ 79,057 Short-term borrowings 1,345 2,808 Current portion of capital lease obligations 15,164 13,550 Trade payables and other accrued liabilities 606,762 603,575 Income taxes payable 20,247 15,333 Deferred income tax liabilities 3,304 3,954 ------------ ------------ Total current liabilities 715,066 718,277 Long-term borrowings 211,308 211,458 Capital lease obligations 21,825 24,099 Deferred income tax liabilities 31,485 30,291 Retirement fund obligations 7,633 7,549 Other long-term liabilities 14,005 12,078 Minority interests 18,537 18,844 Commitments and contingencies Shareholders' equity: Common stock 422,183 419,111 Retained earnings 276,119 266,136 Accumulated other comprehensive loss (31,720) (47,973) ------------ ------------ Total shareholders' equity 666,582 637,274 ------------ ------------ Total liabilities and shareholders' equity $ 1,686,441 $ 1,659,870 ============ ============ UTi Worldwide Inc. Consolidated Statements of Cash Flows (in thousands) Three months ended April 30, ----------------------------- 2007 2006 ------------ ------------ (Unaudited) OPERATING ACTIVITIES: Net income $ 18,120 $ 19,324 Adjustments to reconcile net income to net cash used in operating activities: Share-based compensation costs/ (benefits), net 365 (138) Depreciation and amortization 9,387 7,436 Amortization of intangible assets 1,985 1,851 Deferred income taxes (363) (928) Tax (loss)/benefit relating to exercise of stock options (667) 386 Excess tax benefits from share-based compensation (24) (329) (Loss)/gain on disposal of property, plant and equipment 29 (76) Minority interest and other (858) 1,003 Changes in operating assets and liabilities: Increase in trade receivables (44,287) (92,240) Increase in other current assets (3,689) (4,870) Decrease in trade payables (24,096) (26,291) Increase in accrued liabilities and other current liabilities 7,696 35,634 ------------ ------------ Net cash used in operating activities (36,402) (59,238) INVESTING ACTIVITIES: Purchases of property, plant and equipment (6,143) (4,543) Proceeds from disposal of property, plant and equipment 425 399 Increase in other non-current assets (209) (5,325) Acquisitions and contingent earn-out payments (3,666) (197,238) Other (818) (860) ------------ ------------ Net cash used in investing activities (10,411) (207,567) FINANCING ACTIVITIES: (Decrease)/increase in borrowings under bank lines of credit (8,615) 158,998 Decrease in short-term borrowings (1,570) (1,873) Proceeds from issuing of long-term borrowings -- 211 Repayment of long-term borrowings (26) (747) Repayments of capital lease obligations (5,487) (2,155) Net proceeds from issuance of ordinary shares 3,378 5,652 Excess tax benefits from share-based compensation 24 329 ------------ ------------ Net cash (used in)/provided by financing activities (12,296) 160,415 Effect of foreign exchange rate changes on cash and cash equivalents 5,349 1,949 ------------ ------------ Net decrease in cash and cash equivalents (53,760) (104,441) Cash and cash equivalents at beginning of period 278,408 246,510 ------------ ------------ Cash and cash equivalents at end of period $ 224,648 $ 142,069 ============ ============ UTi Worldwide Inc. Segment Reporting (in thousands) Three months ended April 30, 2007 ------------------------------------------------ Americas Contract Americas Logistics Freight and Asia EMENA Forwarding Distribution Pacific --------- ---------- ------------ --------- Gross revenue $ 239,506 $ 134,610 $ 195,930 $ 107,058 ========= ========= ========= ========= Net revenue $ 75,852 $ 39,526 $ 112,804 $ 22,012 Staff costs 43,425 23,061 62,361 10,868 Depreciation and amortization 1,917 600 3,195 514 Amortization of intangible assets -- -- 1,719 -- Other operating expenses 21,994 11,098 35,631 5,232 --------- --------- --------- --------- Operating income/(loss) $ 8,516 $ 4,767 $ 9,898 $ 5,398 ========= ========= ========= ========= Interest expense, net Losses on foreign exchange Pretax income Provision for income taxes Income before minority interests --------------------------------------------------- Global Greater Specialized China Africa Solutions Corporate Total --------- ---------- --------- --------- --------- Gross revenue $ 118,249 $ 132,458 $ 16,927 $ -- $ 944,738 ========= ========= ======== ======== ========= Net revenue $ 18,257 $ 52,676 $ 14,914 $ -- $ 336,041 Staff costs 7,360 25,013 6,968 5,661 184,717 Depreciation and amortization 605 1,749 387 420 9,387 Amortization of intangible assets 111 -- 155 -- 1,985 Other operating expenses 5,836 19,159 5,156 4,428 108,534 --------- --------- -------- -------- --------- Operating income/(loss) $ 4,345 $ 6,755 $ 2,248 $(10,509) 31,418 ========= ========= ======== ======== Interest expense, net (4,091) Losses on foreign exchange (368) --------- Pretax income 26,959 Provision for income taxes 7,967 --------- Income before minority interests $ 18,992 ========= UTi Worldwide Inc. Segment Reporting (in thousands) Three months ended April 30, 2006 ------------------------------------------------ Americas Contract Americas Logistics Freight and Asia EMENA Forwarding Distribution Pacific --------- ---------- ------------ --------- Gross revenue $ 184,093 $ 113,755 $ 127,060 $ 101,749 ========= ========= ========= ========= Net revenue $ 54,329 $ 34,682 $ 80,814 $ 18,880 Staff costs 28,863 21,776 48,670 8,736 Depreciation and amortization 1,408 538 2,067 417 Amortization of intangible assets -- -- 1,553 -- Other operating expenses 16,107 9,783 22,172 4,377 --------- --------- --------- --------- Operating income/(loss) $ 7,951 $ 2,585 $ 6,352 $ 5,350 ========= ========= ========= ========= Interest expense, net Gains on foreign exchange Pretax income Provision for income taxes Income before minority interests --------------------------------------------------- Global Greater Specialized China Africa Solutions Corporate Total --------- ---------- --------- --------- --------- Gross revenue $ 105,931 $ 121,837 $ 19,275 $ -- $ 773,700 ========= ========= ======== ======== ========= Net revenue $ 16,757 $ 51,782 $ 14,384 $ -- $ 271,628 Staff costs 6,196 24,218 5,900 3,524 147,883 Depreciation and amortization 418 1,738 346 504 7,436 Amortization of intangible assets 115 -- 183 -- 1,851 Other operating expenses 4,654 19,738 4,648 2,997 84,476 --------- --------- -------- -------- --------- Operating income/(loss) $ 5,374 $ 6,088 $ 3,307 $ (7,025) 29,982 ========= ========= ======== ======== Interest expense, net (2,867) Gains on foreign exchange 185 --------- Pretax income 27,300 Provision for income taxes 7,094 --------- Income before minority interests $ 20,206 ========= UTi Worldwide Inc. Revenue Growth Reconciliation (in thousands) (Unaudited) Set forth below is a reconciliation of our organic growth in our gross and net revenues over the corresponding prior-year period. Organic growth ------- GROSS REVENUES: Three months ended April 30, 2007 (as reported) $944,738 Less: Acquisitions impact (1) (69,905) Add: Currency impact (2) (1,161) -------- Three months ended April 30, 2007 (as adjusted) $873,672 ======== Three months ended April 30, 2006 $773,700 13% ======== ======= NET REVENUES: Three months ended April 30, 2007 (as reported) $336,041 Less: Acquisitions impact (3) (26,883) Add: Currency impact (2) 4,048 -------- Three months ended April 30, 2007 (as adjusted) $313,206 ======== Three months ended April 30, 2006 $271,628 15% ======== ======= (1) Represents gross revenues attributable to acquisitions that were completed on or after February 1, 2006. (2) Represents the fluctuations in foreign currency exchange rates when balances are translated into U.S. dollars. (3) Represents net revenues attributable to acquisitions that were completed on or after February 1, 2006.