CH Robinson struggles in after-hours trade after big earnings miss

01/02/2023

(This post was published on Wednesday, 1 February. Thursday’s follow-up coverage is here: Dismal CH Robinson a thing of the past, get on with post-Bob era.)

US-based 3PL CH Robinson just reported financial results for Q4, which didn’t look good and missed expectations – big time.

The key Q4 highlights sourced from the company’s statement, released after the markets closed today, follow:

– Income from operations down 42.9% to $164m

– Adjusted operating margin decreased 1,220 basis points to 21.4%

– Diluted earnings per share (EPS) decreased 54.0% to $0.80

– Adjusted EPS decreased 40.8% to $1.03

– Operating cash flow rose to $773.4 million

In his prepared remarks, interim CEO Scott Anderson said:

“We’re increasing our focus on delivering a scalable operating model to lower our costs, improve the customer and carrier experience and foster long-term profitable growth through cycles.

“The current point in the cycle is one of shippers managing through elevated inventories amidst slowing economic growth, causing unseasonably soft demand for transportation services. At the same time, prices for ground transportation and global freight forwarding are declining due to the changing balance of supply and demand. While a correction in the freight forwarding market was certainly expected, the speed and magnitude of the correction in only two quarters was unexpected, with ocean rates on some trade lanes already back to pre-pandemic levels.

“I believe we’re uniquely positioned in the marketplace to deliver for our shippers, carriers and shareholders through a combination of our digital solutions, our global suite of services and our network of global logistics experts.”

According to Seeking Alpha, Q4 Non-GAAP EPS of $1.03 missed estimates by $0.31, while sales were almost half a billion $ lower for the final quarter of the year.

The stock, down as much as 5% below $97 in after-hours trade, was under pressure ahead of the call with analysts, which is taking place at 5pm EST. Today, its closing level was $102.12.