RANCHO DOMINGUEZ, Calif., Sept. 5, 2001 (PRIMEZONE) -- UTi Worldwide Inc. (Nasdaq:UTIW) today reported financial results in line with previously announced expectations for the three- and six-month periods ended July 31, 2001. The company's results are reported in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP).
For the second quarter of fiscal 2002, net revenues rose 5 percent to $79.0 million from $75.3 million in the corresponding three months last year. Gross revenues totaled $219.4 million, a 5 percent increase over $209.3 million a year earlier. As expected, foreign exchange rates negatively impacted revenues for the current quarter versus the comparable period in the prior year. On a constant currency basis using exchange rates in effect for the fiscal 2001 second quarter, net revenues would have been $86.0 million, reflecting a growth rate of 14 percent over the year-ago period, and gross revenues would have advanced 13 percent to $236.2 million.
Net income for the second quarter of fiscal 2002 increased 13 percent to $5.4 million from net income of $4.8 million for the corresponding 2001 quarter. Diluted earnings per share for the second quarter 2002 was $0.21 versus $0.24 for the corresponding period last year, which reflects the significantly increased number of shares outstanding due to the company's U.S. initial public offering in November 2000.
For the first six months of fiscal 2002, UTi Worldwide recorded net revenues of $153.1 million, an increase of 8.5% over $141.1 million in the same period of fiscal 2001. Gross revenues improved 8 percent to $434.4 million from $402.0 million last year. On a constant currency basis using exchange rates in effect for the first half of fiscal 2001, net revenues would have been $167.3 million, reflecting a growth rate of 19 percent over the year-ago period, and gross revenues would have advanced 16 percent to $466.5 million.
"The business environment remains challenging and certainly impacted our revenue and net income increases for the quarter and first half of fiscal 2002," said Roger I. MacFarlane, UTi's chief executive officer. "We were encouraged by the performance in our Asia Pacific region, which demonstrated strong growth on a year-over-year basis for both the second quarter and six months. This increase was attributable to significant organic growth in that region, as well as our strategic acquisition of Continental during September 2000."
Net income for the first half of fiscal 2002 increased 32 percent to $9.4 million from net income of $7.1 million last year. Diluted earnings per share for the first half of fiscal 2002 was $0.37 versus $0.36 for the corresponding period last year, which reflects the significantly increased number of shares outstanding due to the company's U.S. initial public offering in November 2000.
"As expected and similar to other freight forwarding and logistics companies, our rate of growth in revenue and net income was restrained as a result of the global economic slowdown, industry-wide lower airfreight shipment volumes, and continuing weakness in currency exchange rates," said MacFarlane. "Nevertheless, we believe UTi's global network is well positioned to gain business in the current environment, and to thrive in a more favorable one."
Operating income for the 2002 second quarter grew 18 percent to $8.5 million from $7.2 million last year. The company's operating profit margin, excluding amortization of goodwill, improved 150 basis points to 12.5 percent of net revenues compared with 11.0 percent for the same period a year ago. For the first half of 2002, operating income totaled $13.8 million, a 24 percent increase from $11.1 million in the corresponding period a year earlier. Excluding amortization of goodwill, the company's operating profit margin improved 150 basis points to 10.7 percent of net revenues, compared with 9.2 percent for the same six-month period a year ago.
"We are encouraged by the improved operating margins reported for the second quarter that reflect the progress of ongoing measures initiated in the fourth quarter of last fiscal year. We maintain the view that weak economic conditions around the world are continuing and we are seeing the effect on volume levels, particularly in airfreight. We must, therefore, remain focused on tightly managing transportation costs and general expenses, including headcount, in light of these conditions. We also continue to explore every opportunity to increase business with existing customers and to secure new customers."
As of July 31, 2001, UTi reported total cash and cash equivalents, net of bank lines of credit and short-term bank borrowings, of $61.4 million. Through the first half of fiscal 2002, UTi generated $14 million in free cash flow. "We are especially pleased with our receivable collection performance in this tough economic environment," said MacFarlane.
About UTi Worldwide
UTi Worldwide Inc. is a global, non-asset based supply chain management business providing supply chain logistics services and planning and optimization solutions. The company's services include freight forwarding, customs brokerage and warehousing services such as the coordination of shipping and the storage of raw materials, supplies, components and finished goods. Through its supply chain planning and optimization services, the company assists clients in designing and implementing systems that improve the predictability and visibility and reduce the overall cost of their supply chains. The company has a global and diverse business customer base ranging from large multinational enterprises to smaller local businesses. For more information about the company visit its Web site at www.go2uti.com.
Investor Conference Call
UTi management will host an investor conference call on Wednesday, September 5, 2001, at 6:00 a.m. PDT (9:00 a.m. EDT) to review the company's financials and operations for the second quarter and first half of fiscal 2002. The call will be open to all interested investors through a live, listen-only audio broadcast available over the Internet at www.go2uti.com and www.streetfusion.com. For those who are not able to listen to the live broadcast, the call will be archived for two weeks through 6:00 p.m. PDT, Wednesday, September 19, 2001 at both Web sites. A telephonic playback of the conference call also will be available from approximately 8:00 a.m. PDT, Wednesday, September 5, through 6:00 p.m. PDT, Wednesday, September 12, by calling 800-633-8284 (domestic) or 858-812-6440 (international) and using Reservation No.19394288.
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 strategies to realize operating margin gains, expectations regarding revenue levels for the remainder of the year, the company's ability to benefit from on-going cost control efforts, the company's focus on gaining market share, and any other statements, which are not historical facts. Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements, including general economic, political and market conditions, increased competition, integration risks associated with acquisitions, the effects of changes in foreign exchange rates, increases in the company's effective tax rates, industry consolidation making it more difficult to compete against larger companies, risks of international operations, the success and effects of new strategies, and the other risks and uncertainties described in the company's filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, actual results may vary materially from those indicated. Although UTi believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to be 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.
UTi Worldwide Inc.
Condensed Consolidated Income Statements
(Prepared in Accordance with U.S. Generally
Accepted Accounting Principles)
(US$000s, except share and per share amounts)
Three Months Ended Six Months Ended
July 31, July 31,
2001 2000 2001 2000
----------- ----------- ----------- -----------
(Unaudited)
Gross revenue:
Airfreight
forwarding $ 117,761 $ 110,218 $ 238,453 $ 218,814
Ocean freight
forwarding 66,021 63,813 126,140 118,505
Customs
brokerage 15,025 15,827 28,499 29,523
Other 20,610 19,435 41,297 35,143
----------- ----------- ----------- -----------
Total gross
revenue 219,417 209,293 434,389 401,985
=========== =========== =========== ===========
Net revenue:
Airfreight
forwarding 37,396 35,225 73,449 67,332
Ocean freight
forwarding 14,574 13,171 27,971 24,083
Customs
brokerage 14,492 15,043 27,547 27,818
Other 12,511 11,893 24,182 21,900
----------- ----------- ----------- -----------
Total net
revenue 78,973 75,332 153,149 141,133
----------- ----------- ----------- -----------
Staff costs 40,043 38,825 79,293 73,084
Depreciation 2,349 2,198 4,655 4,255
Amortization of
goodwill 1,395 1,087 2,658 1,877
Other operating
expenses 26,701 26,043 52,754 50,791
----------- ----------- ----------- -----------
Operating income 8,485 7,179 13,789 11,126
Interest expense,
net (437) (995) (652) (1,660)
(Losses)/gains on
foreign exchange (12) 665 (91) 633
----------- ----------- ----------- -----------
Pretax income 8,036 6,849 13,046 10,099
Income tax
expense (2,304) (1,759) (3,152) (2,579)
----------- ----------- ----------- -----------
Income before
minority
interests 5,732 5,090 9,894 7,520
Minority
interests (323) (307) (465) (400)
----------- ----------- ----------- -----------
Net income $ 5,409 $ 4,783 $ 9,429 $ 7,120
=========== =========== =========== ===========
Diluted earnings
per ordinary
share $ 0.21 $ 0.24 $ 0.37 $ 0.36
Number of
weighted-average
diluted shares
outstanding used
for per share
calculations 25,555,520 19,796,083 25,540,340 19,873,27
UTi Worldwide Inc.
Condensed Consolidated Balance Sheets
(Prepared in Accordance with U.S. Generally
Accepted Accounting Principles)
(US$000s)
July 31, January 31,
2001 2001
--------- ---------
(Unaudited)
ASSETS
Cash and cash equivalents $ 89,553 $ 98,372
Trade receivables, net 184,616 212,860
Other current assets 25,315 23,551
--------- ---------
Total current assets 299,484 334,783
Property, plant and
equipment, net 31,967 34,952
Goodwill, net 69,558 68,043
Investments 173 209
Deferred income tax assets 1,961 1,469
Other non-current assets 4,396 4,297
--------- ---------
Total assets $ 407,539 $ 443,753
========= =========
LIABILITIES & SHAREHOLDERS'
EQUITY
Bank lines of credit $ 17,148 $ 32,609
Current portion of capital
lease obligations 1,848 2,307
Short-term borrowings 11,011 11,570
Trade payables and other
accrued liabilities 165,904 188,902
Income taxes payable 3,838 3,747
Deferred income tax
liabilities 278 213
--------- ---------
Total current liabilities 200,027 239,348
Long-term bank borrowings 3,040 3,159
Capital lease obligations 8,360 8,672
Deferred income tax
liabilities 2,311 2,377
Pension obligations 643 682
--------- ---------
Total long-term liabilities 14,354 14,890
Minority interests 1,702 2,027
Commitments and
contingencies
Shareholders' equity:
Common stock (ordinary
shares of no par value:
25,686,614 and 25,685,950
shares issued and outstanding
as of July 31, 2001 and
January 31, 2001 respectively) 206,723 206,626
Retained earnings 26,879 19,376
Accumulated other
comprehensive loss (42,146) (38,514)
--------- ---------
Total shareholders' equity 191,456 187,488
--------- ---------
Total liabilities and
shareholders' equity $ 407,539 $ 443,753
========= =========
UTi Worldwide Inc.
Consolidated Statements of Cash Flows
(Prepared in Accordance with U.S. Generally
Accepted Accounting Principles)
(US$000s)
Six Months Ended
--------------------
July 31,
--------------------
2001 2000
-------- --------
(Unaudited)
OPERATING ACTIVITIES:
Net income $ 9,429 $ 7,120
Adjustments to reconcile net income to
net cash provided by operating activities:
Stock compensation costs 95 1,416
Depreciation 4,655 4,255
Amortization of goodwill 2,658 1,877
Deferred income taxes 127 343
Gain on disposal of property, plant
and equipment (52) (221)
Gain on disposal of other investments -- (196)
Other 340 (1,243)
Changes in operating assets and
liabilities:
Decrease/(increase) in trade
receivables and other current assets 18,452 (44,413)
(Decrease)/increase in trade payables
and other accrued liabilities (17,177) 39,028
-------- --------
Net cash provided by operating
activities 18,527 7,966
-------- --------
INVESTING ACTIVITIES:
Purchases of property, plant and equipment (3,305) (8,424)
Proceeds from disposal of property,
plant and equipment 428 476
Acquisition of subsidiaries (4,853) (6,681)
Other 240 513
-------- --------
Net cash used in investing activities (7,490) (14,116)
-------- --------
FINANCING ACTIVITIES:
(Decrease)/increase in bank lines
of credit (15,461) 9,714
Bank borrowings - advanced 135 358
Bank borrowings - repaid (39) (101)
Capital lease obligations - repaid (567) (1,232)
Increase in minority interests (401) (208)
Dividends paid (1,924) --
Other 16 631
-------- --------
Net cash (used in)/provided by
financing activities (18,241) 9,162
-------- --------
Net (decrease)/increase in cash and
cash equivalents (7,204) 3,012
Cash and cash equivalents at beginning
of period 98,372 20,760
Effect of foreign exchange rate changes (1,615) 973
-------- --------
Cash and cash equivalents as of July 31 $ 89,553 $ 24,745
======== ========
UTi Worldwide Inc.
Segment Reporting
(Prepared in Accordance with U.S. Generally
Accepted Accounting Principles)
(US$000s)
Three Months Ended July 31, 2001
--------------------------------
(Unaudited)
Europe Americas AsiaPacific
=========== =========== ===========
Gross revenue from
external customers $ 62,027 $ 68,959 $ 55,470
=========== =========== ===========
Net revenue $ 15,317 $ 24,010 $ 15,452
Staff costs 8,533 14,662 6,643
Depreciation 574 623 405
Amortization of goodwill 185 829 303
Other operating expenses 4,043 7,014 4,766
----------- ----------- -----------
Operating income $ 1,982 $ 882 $ 3,335
=========== =========== ===========
Africa Corporate Total
=========== =========== ===========
Gross revenue from
external customers $ 32,961 $ -- $ 219,417
=========== =========== ===========
Net revenue $ 24,194 $ -- $ 78,973
Staff costs 9,167 1,038 40,043
Depreciation 646 101 2,349
Amortization of goodwill 78 -- 1,395
Other operating expenses 10,972 (94) 26,701
----------- ------------ -----------
Operating income $ 3,331 $ (1,045) 8,485
=========== ===========
Interest expense, net (437)
Losses on foreign exchange (12)
------------
Pretax income 8,036
Income tax expense (2,304)
------------
Income before minority interests $ 5,732
===========
Three Months Ended July 31, 2000
--------------------------------
(Unaudited)
Europe Americas AsiaPacific
=========== =========== ===========
Gross revenue from
external customers $ 75,193 $ 74,274 $ 31,854
=========== =========== ===========
Net revenue $ 16,663 $ 25,417 $ 8,850
Staff costs 8,661 15,158 4,076
Depreciation 599 534 212
Amortization of goodwill 184 683 138
Other operating expenses 5,638 7,478 2,815
----------- ----------- -----------
Operating income $ 1,581 $ 1,564 $ 1,609
=========== =========== ===========
Africa Corporate Total
=========== =========== ===========
Gross revenue from
external customers $ 27,972 $ -- $ 209,293
=========== =========== ===========
Net revenue $ 24,402 $ -- $ 75,332
Staff costs 10,420 510 38,825
Depreciation 774 79 2,198
Amortization of goodwill 82 -- 1,087
Other operating expenses 10,118 (6) 26,043
----------- ------------ -----------
Operating income $ 3,008 $ (583) 7,179
=========== ===========
Interest expense, net (995)
Gains on foreign exchange 665
-----------
Pretax income 6,849
Income tax expense (1,759)
-----------
Income before minority interests $ 5,090
===========
UTi Worldwide Inc.
Segment Reporting
(Prepared in Accordance with U.S. Generally
Accepted Accounting Principles)
(US$000s)
Six Months Ended July 31, 2001
------------------------------
(Unaudited)
Europe Americas AsiaPacific
=========== =========== ===========
Gross revenue
from external customers $ 126,595 $ 134,741 $ 110,575
=========== =========== ===========
Net revenue $ 30,193 $ 47,978 $ 28,810
Staff costs 17,163 29,092 12,871
Depreciation 1,154 1,258 785
Amortization of goodwill 334 1,561 607
Other operating expenses 7,877 14,546 8,910
----------- ----------- -----------
Operating income $ 3,665 $ 1,521 $ 5,637
=========== =========== ===========
Africa Corporate Total
=========== =========== ===========
Gross revenue
from external customers $ 62,478 $ -- $ 434,389
=========== =========== ===========
Net revenue $ 46,168 $ -- $ 153,149
Staff costs 18,035 2,132 79,293
Depreciation 1,283 175 4,655
Amortization of goodwill 156 -- 2,658
Other operating expenses 21,393 28 52,754
----------- ----------- -----------
Operating income $ 5,301 $ (2,335) 13,789
=========== ============
Interest expense, net (652)
Losses on foreign exchange (91)
------------
Pretax income 13,046
Income tax expense (3,152)
-----------
Income before minority interests $ 9,894
===========
Six Months Ended July 31, 2000
------------------------------
(Unaudited)
Europe Americas AsiaPacific
=========== =========== ===========
Gross revenue from
external customers $ 137,660 $ 132,137 $ 69,158
=========== =========== ===========
Net revenue $ 30,231 $ 45,669 $ 17,358
Staff costs 16,255 27,756 8,081
Depreciation 1,085 994 411
Amortization of goodwill 300 1,193 222
Other operating expenses 9,415 14,002 5,527
----------- ----------- -----------
Operating income $ 3,176 $ 1,724 $ 3,117
=========== =========== ===========
Africa Corporate Total
=========== =========== ===========
Gross revenue from
external customers $ 63,030 $ -- $ 401,985
=========== =========== ===========
Net revenue $ 47,875 $ -- $ 141,133
Staff costs 20,408 584 73,084
Depreciation 1,590 175 4,255
Amortization of goodwill 162 -- 1,877
Other operating expenses 21,315 532 50,791
----------- ----------- -----------
Operating income $ 4,400 $ (1,291) 11,126
=========== ===========
Interest expense, net (1,660)
Gains on foreign exchange 633
-----------
Pretax income 10,099
Income tax expense (2,579)
-----------
Income before minority interests $ 7,520
===========