C.H. Robinson Reports 382% Earnings Jump for Q4
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C.H. Robinson Worldwide experienced a 382% year-over-year increase in earnings for the fourth quarter of 2024, a result that the company said was boosted by its tightly focused operating model as well as the effects of a shift in its quarterly effective tax rate.
The Eden Prairie, Minn.-based logistics and shipping company on Jan. 29 posted net income of $149.3 million, or $1.22 a diluted share, for the three months ending Dec. 31. That compared with $31 million, or 26 cents, during the same time the previous year. Total revenue decreased 0.9% to $4.18 billion from $4.22 billion, a drop the company attributed primarily to lower volume and pricing in truckload services. This was partially offset by higher pricing in ocean services.
“We’ve talked extensively over the past year about our new Robinson operating model and the disciplined execution that the model is enabling, as well as how we’re leveraging our industry-leading talent and technology to raise the bar in logistics,” C.H. Robinson CEO Dave Bozeman said during a call with investors. “The benefits of these efforts were never more evident than in the significant year-over-year improvement in our Q4 financial results.”
Bozeman noted this approach helped bolster higher quality volume, greater productivity and profit growth, even amid a historically prolonged freight recession.
“Our new operating model has changed how we discover and inspect root cause issues and quickly implement countermeasures to improve the level of our operational execution,” Bozeman said. “The reliability of our operating reviews continues to increase as we leverage our data-rich environment to inform our decision making and enhance our competitive differentiation.”
Wall Street analysts expected Q4 EPS of $1.12 per share and quarterly revenue of $4.47 billion, according to Zacks Consensus Estimate.
The company’s Q4 effective tax rate was 11.4%, compared with 55.3% in Q4 2023. The lower rate was driven by the impact of non-recurring discrete items, higher U.S. tax credits and increased tax benefit related to stock-based compensation that was partially offset by lower foreign tax credits.
For the full year, C.H. Robinson reported net income of $465.7 million, or $3.86 a share, on revenue of $17.7 billion, compared with net income of $325.1 million, or $2.72, on revenue of $17.6 billion in 2023. The slight revenue increase was primarily driven by higher pricing and volume in ocean services, partially offset by lower pricing and volume in truckload.
North American Surface Transportation revenue declined 6.6% to $2.8 billion from $3 billion during the previous year. This was primarily driven by lower truckload volume and pricing due to the oversupply of truckload capacity amid weak freight demand. The report noted that overall volume decreased approximately 1% for the quarter, but cost optimization efforts, productivity improvements and lower claims helped operating expenses decrease 4.6%. Income from operations increased 38.1% to $132.5 million from $96 million.
“In a trucking environment, where the cost of purchased transportation increased in Q4 due to a decline in industry capacity, our dynamic costing and pricing tools, our revenue management practices and our costs to hire advantage enabled us to provide greater value to our customers and — at the same time — improve our NAST gross margin both year over year and sequentially,” Bozeman said.
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Global forwarding segment revenue increased 24.7% to $884 million from $708.8 million during the prior year, primarily driven by higher pricing in ocean services. Ocean shipment profit grew due to an increase in shipments and an adjusted gross profit per shipment. The air shipment business grew profit on an increase in metric tons shipped and adjusted gross profit per shipment. Income from operations surged 129.6% to $51.8 million from $22.6 million.
“In our global forwarding business, the team has debunked the thesis that Robinson couldn’t continue to improve productivity when volumes are growing,” Bozeman said. “Throughout 2024, I’ve been impressed with and highly appreciative of the team as they continue to be nimble and highly engaged with our customers to help them navigate various market disruptions and to provide differentiated service and solutions.”
C.H. Robinson ranks No. 2 on the Transport Topics Top 100 list of the largest logistics companies in North America.
