Expeditors has blamed falling operating income over the first half of the year on its inability to pass higher pricing on to customers.

Revenues grew 13% to $1.67bn in the second quarter, while air freight tonnage rose 9% and ocean freight rose 4%, but operating income fell 6% to $168m and net earnings fell 6% to $108m.

In the first half, revenues grew 11% to $3.2bn, but operating income and net earnings both fell 5%, at $314m and $202m respectively.

“Global demand for air and ocean capacity continues to be stronger than we have seen in the past few years, which has led to a scarcity of favourable pricing,” said president and CEO Jeffrey Musser.

He added: “As the rate environment continues to shift, we are being increasingly disciplined in how we work, both with our customers and with our carrier partners, to secure access to capacity.

“In June, we initiated rate increases in certain high-volume lanes in response to the market and expect to see strong demand, tight capacity and rate volatility to continue throughout the remainder of the year.”

Expeditors said it had seen some of the highest freight volumes in its history and “we continue to take profitable market share”. However, as major forwarders report their half-year results, all seem to have faced the problem of existing customer agreements combining with significantly higher transport costs putting the squeeze on them, the middle man.

Air freight accounted for 40% of Expeditors’ first-half revenue, the lion’s share of its business.  Ocean freight comprised 32% while customs brokerage and other services brought in 28%. Operating expenses rose 13%, with air freight costs rising 19%, and ocean freight expenses up 16%.

You can read the full results here.

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