RANCHO DOMINGUEZ, Calif., Dec. 10, 2003 (PRIMEZONE) -- UTi Worldwide Inc. (Nasdaq:UTIW) today reported, for the seventh consecutive quarter, increases in revenues and income for the three-month period ended October 31, 2003, compared with year-earlier results.
Gross revenues for the fiscal 2004 third quarter rose 24 percent to $398.7 million from $321.5 million in the corresponding prior-year period. Net revenues grew 46 percent to $156.5 million from $107.5 million in the third fiscal quarter a year ago. Standard Corporation, which was acquired effective October 1, 2002, contributed $39.0 million to both gross and net revenues during the full three months of the current third quarter. This compares with a revenue contribution from Standard of $12.7 million in the last month of the fiscal 2003 third quarter.
"These results represent another solid quarter of net revenue gains over the prior year," said Roger I. MacFarlane, chief executive officer of UTi Worldwide. "We are particularly pleased with UTi's airfreight forwarding operations, which recorded a 23 percent increase in third quarter net revenues from a year earlier. This increase was realized even with last year's unusually high airfreight volumes in response to the West Coast port lock-out. In addition, we achieved an improvement in airfreight yields to 27 percent during the current quarter, compared with 24 percent in the fiscal 2003 third quarter."
Ocean freight net revenues advanced 12 percent over last year's third quarter and net revenues for customs brokerage grew 5 percent compared with a year ago. The acquisition of Standard in October 2002 continues to bolster contract logistics net revenues, which totaled $50.7 million, compared with $20.6 million in the fiscal 2003 third quarter.
UTi's global network also achieved gross and net revenue gains over the prior-year period across all geographic regions. The Americas, with a full three months contribution from Standard, recorded a 77 percent increase in net revenues from the year-ago third quarter, which included one month's contribution from Standard. Asia Pacific net revenues grew 20 percent. Africa and Europe posted third quarter net revenue increases of 43 percent and 23 percent, respectively. Both benefited by the weaker U.S. dollar, compared with last year's exchange rates.
Operating income in the fiscal 2004 third quarter increased 26 percent to $18.0 million from $14.2 million in the fiscal 2003 third quarter. Operating margin, which is operating income as a percentage of net revenues, equaled 11.5 percent in the current third quarter, compared with 13.2 percent in the fiscal 2003 third quarter. Operating margins in the current third quarter were reduced by the inclusion of Standard for the full quarter, which traditionally operates at a lower operating margin, compared with other UTi operations. Excluding the operating income of Standard, the company's operating profit ratio remained level at 14.1 percent for both the fiscal 2003 and 2004 third quarters. Management believes this measurement is a key operating indicator to allow a better comparison of the company's current performance against its historical performance, and the attached schedule shows a reconciliation of this measurement to UTi's operating income as presented under U.S. GAAP.
Net income for the fiscal 2004 third quarter advanced 39 percent to $13.2 million, or $0.42 per diluted share, based on 31.5 million weighted average shares outstanding. This compares with last year's third quarter net income of $9.5 million, or $0.37 per diluted share, based on 25.8 million weighted average shares outstanding. UTi's follow-on offering of 4.6 million ordinary shares in December 2002 resulted in a higher weighted average number of shares outstanding for the current third quarter, compared with the corresponding prior-year period.
"The year-over-year increases in revenues, operating income and net income for UTi throughout the first seven of 20 quarters in our NextLeap strategy underscore the soundness of our vision and resolve and the dedication of UTi's employees worldwide," MacFarlane said. "We continue to focus on investing in the skills and talent of our global sales and customer management organization, and on revenue growth, operating margins and cash flow. We believe these efforts will better position us to gain additional market share and become the primary logistics partner with more of our strategic customers."
For the nine-month period ended October 31, 2003, gross revenues advanced 31 percent to $1.1 billion from $832.0 million for the same period a year ago. Net revenues rose 59 percent to $432.8 million from $272.0 million in the comparable prior-year period. Standard contributed $114.2 million to both gross and net revenues during the nine-month period ended October 31, 2003, compared with $12.7 million in the corresponding period last year. Operating income for the year-to-date period totaled $44.1 million, a 31 percent increase over $33.6 million in the first nine months of fiscal 2003. Operating margin (operating income as a percentage of net revenues) equaled 10.2 percent in the current nine-month period, compared with 12.4 percent a year ago, again reflecting the impact of a full nine-months contribution from Standard. Net income for the fiscal 2004 nine-month period increased 48 percent to $32.6 million, or $1.04 per diluted share, based on 31.4 million weighted average shares outstanding. This com
pares with net income in the corresponding period a year ago of $22.0 million, or $0.85 per diluted share, based on 25.8 million weighted average shares outstanding.
At October 31, 2003, the company reported total cash and cash equivalents, net of outstanding bank lines of credit and short-term bank borrowings, of $129 million, compared with $126 million at January 31, 2003.
About UTi Worldwide
UTi Worldwide Inc. is an international, non-asset based supply chain management company providing air and ocean freight forwarding, contract logistics, customs brokerage and other logistics-related services. The company serves a large and diverse base of global and local companies, including customers operating in industries with unique supply chain requirements such as the pharmaceutical, 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 optimize the operation of its customers' global supply chains.
Investor Conference Call
UTi management will host an investor conference call today, Wednesday, December 10, 2003, at 8:00 a.m. PST (11:00 a.m. EST) to review the company's financials and operations for the third quarter ended October 31, 2003. The call will be open to all interested investors through a live, listen-only audio Web broadcast via the Internet at www.go2uti.com and www.fulldisclosure.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 10:00 a.m. PST, Wednesday, December 10, through 5:00 p.m. PST, Friday, December 12, by calling 800-633-8284 (domestic) or 402-977-9140 (international) and using Reservation No. 21166839.
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 growth strategy and integration of acquisitions. Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements, including increased competition; integration risks associated with acquisitions; 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; 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, 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
(in thousands, except share and per share amounts)
Three Months Ended Nine Months Ended
----------------------- -----------------------
October 31, October 31,
----------------------- -----------------------
2003 2002 2003 2002
---------- ---------- ---------- -----------
(Unaudited) (Unaudited)
Gross revenues:
Airfreight
forwarding $ 195,149 $ 174,389 $ 522,201 $ 457,499
Ocean freight
forwarding 93,319 76,082 256,230 209,405
Customs
brokerage 17,189 17,275 49,430 46,773
Contract
logistics 61,447 25,850 169,355 51,321
Other 31,622 27,925 90,323 67,000
---------- ---------- ---------- ----------
Total gross
revenues $ 398,726 $ 321,521 $1,087,539 $ 831,998
========== ========== ========== ==========
Net revenues:
Airfreight
forwarding $ 52,230 $ 42,431 $ 145,376 $ 115,043
Ocean freight
forwarding 19,114 17,079 54,103 48,515
Customs
brokerage 17,370 16,476 47,818 44,423
Contract
logistics 50,668 20,612 141,185 36,150
Other 17,163 10,931 44,341 27,860
---------- ---------- ---------- ----------
Total net
revenues 156,545 107,529 432,823 271,991
---------- ---------- ---------- ----------
Staff costs 81,206 52,436 231,760 136,044
Depreciation and
amortization 3,531 2,790 10,750 7,617
Amortization of
intangible
assets 178 70 484 70
Other operating
expenses 53,657 37,995 145,725 94,664
---------- ---------- ---------- ----------
Operating income 17,973 14,238 44,104 33,596
Interest income/
(expense), net 458 (46) 967 (426)
Losses on
foreign
exchange (336) (394) (12) (709)
---------- ---------- ---------- ----------
Pretax income 18,095 13,798 45,059 32,461
Provision for
income taxes (4,419) (3,891) (11,173) (9,185)
---------- ---------- ---------- ----------
Income before
minority
interests 13,676 9,907 33,886 23,276
Minority
interests (498) (437) (1,318) (1,310)
---------- ---------- ---------- ----------
Net income $ 13,178 $ 9,470 $ 32,568 $ 21,966
========== ========== ========== ==========
Basic earnings
per ordinary
share $ 0.43 $ 0.37 $ 1.08 $ 0.87
Diluted earnings
per ordinary
share $ 0.42 $ 0.37 $ 1.04 $ 0.85
Number of
weighted-average
shares outstanding
used for per share
calculations
Basic shares 30,301,508 25,346,730 30,236,777 25,315,265
Diluted shares 31,539,692 25,822,416 31,392,561 25,797,360
UTi Worldwide Inc.
Condensed Consolidated Balance Sheets
(in thousands)
October 31, January 31,
2003 2003
----------- -----------
(Unaudited)
ASSETS
Cash and cash
equivalents
(including restricted
cash of $4,000) $ 165,890 $ 168,125
Trade receivables, net 302,024 247,893
Deferred income tax
assets 4,164 1,592
Other current assets 36,144 30,492
--------- ---------
Total current assets 508,222 448,102
Property, plant and
equipment, net 52,814 44,566
Goodwill and other
intangible assets, net 141,591 125,641
Investments 1,128 847
Deferred income tax
assets 2,221 1,227
Other non-current assets 9,571 6,692
--------- ---------
Total assets $ 715,547 $ 627,075
========= =========
LIABILITIES & SHAREHOLDERS' EQUITY
Bank lines of credit $ 34,351 $ 33,458
Short-term borrowings 2,471 9,121
Current portion of
capital lease
obligations 2,109 2,539
Trade payables and
other accrued
liabilities 281,433 236,548
Income taxes payable 11,778 8,083
Deferred income tax
liabilities 383 489
--------- ---------
Total current
liabilities 332,525 290,238
Long-term bank
borrowings 96 199
Capital lease
obligations 7,668 7,111
Deferred income
tax liabilities 2,100 1,643
Retirement fund
obligations 1,219 1,016
Minority interests 3,752 2,699
Commitments and
contingencies
Shareholders' equity:
Common stock 313,814 311,161
Retained earnings 93,651 63,973
Accumulated other
comprehensive loss (39,278) (50,965)
--------- ---------
Total shareholders'
equity 368,187 324,169
--------- ---------
Total liabilities
and shareholders'
equity $ 715,547 $ 627,075
========= =========
UTi Worldwide Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
Nine Months Ended
October 31,
------------------------
2003 2002
----------- ----------
(Unaudited)
OPERATING ACTIVITIES:
Net income $ 32,568 $ 21,966
Adjustments to reconcile net
income to net cash provided by
operating activities:
Stock compensation costs 130 137
Depreciation and amortization 10,750 7,617
Amortization of intangible assets 484 70
Deferred income taxes 1,009 (291)
Gain on disposal of property, plant
and equipment 194 129
Other 1,318 1,349
Changes in operating assets and liabilities:
Increase in trade receivables and other
current assets (40,113) (41,014)
Increase in trade payables and other
accrued liabilities 30,271 35,703
--------- ---------
Net cash provided by operating activities 36,611 25,666
--------- ---------
INVESTING ACTIVITIES:
Purchases of property, plant and equipment (13,759) (7,113)
Proceeds from disposal of property,
plant and equipment 584 365
Increase in other non-current assets (794) --
Acquisition of subsidiaries and contingent
earn-out payments (14,269) (54,756)
Other (444) (442)
--------- ---------
Net cash used in investing activities (28,682) (61,946)
--------- ---------
FINANCING ACTIVITIES:
Increase in bank lines of credit 893 24,894
Decrease in short-term borrowings (6,368) (991)
Long-term bank borrowings - repaid (130) (1,109)
Capital lease obligations - repaid (2,608) (2,515)
Decrease in minority interests (338) (935)
Proceeds from issuance of ordinary shares 2,523 555
Dividends paid (2,890) (1,929)
--------- ---------
Net cash (used in)/provided by financing
activities (8,918) 17,970
--------- ---------
Net decrease in cash and cash equivalents (989) (18,310)
Cash and cash equivalents at beginning
of period 168,125 87,594
Effect of foreign exchange rate changes (1,246) 81
--------- ---------
Cash and cash equivalents
at end of period $ 165,890 $ 69,365
========= =========
UTi Worldwide Inc.
Segment Reporting
(in thousands)
Three Months Ended October 31, 2003
(Unaudited)
-------------------------------------------------------
Asia
Europe Americas Pacific Africa Corporate Total
--------- -------- -------- -------- --------- --------
Gross revenue
from external
customers $ 104,961 $ 119,629 $118,309 $ 55,827 $ -- $398,726
========= ========= ======== ======== ======== ========
Net revenue $ 31,882 $ 66,221 $ 23,543 $ 34,899 $ -- $156,545
Staff costs 18,367 37,343 9,547 14,871 1,078 81,206
Depreciation
and
amortization 1,085 990 476 787 193 3,531
Amortization
of intangible
assets -- 149 -- 29 -- 178
Other
operating
expenses 9,346 22,807 5,693 14,260 1,551 53,657
--------- --------- -------- ------- -------- --------
Operating
income/
(loss) $ 3,084 $ 4,932 $ 7,827 $ 4,952 $ (2,822) 17,973
========= ======== ======== ======== =========
Interest
income, net 458
Losses on
foreign
exchange (336)
--------
Pretax income 18,095
Provision for
income taxes (4,419)
--------
Income before
minority
interests $ 13,676
========
Three Months Ended October 31, 2002
(Unaudited)
------------------------------------------------------
Asia
Europe Americas Pacific Africa Corporate Total
-------- -------- -------- -------- --------- --------
Gross revenues
from external
customers $ 99,422 $ 82,110 $102,159 $ 37,830 $ -- $321,521
======== ======== ======== ======== ======== ========
Net revenues $ 26,013 $ 37,450 $ 19,623 $ 24,443 $ -- $107,529
Staff costs 14,341 20,364 7,818 8,819 1,094 52,436
Depreciation
and
amortization 889 782 502 465 152 2,790
Amortization
of intangible
assets -- 70 -- -- -- 70
Other
operating
expenses 7,540 14,056 5,105 10,162 1,132 37,995
-------- -------- -------- -------- -------- --------
Operating
income/(loss) $ 3,243 $ 2,178 $ 6,198 $ 4,997 $ (2,378) 14,238
======== ======== ======== ======== ========
Interest
expense, net (46)
Losses on
foreign
exchange (394)
--------
Pretax income 13,798
Provision for
income taxes (3,891)
--------
Income before
minority
interests $ 9,907
========
UTi Worldwide Inc.
Segment Reporting
(in thousands)
Nine Months Ended October 31, 2003
(Unaudited)
-------------------------------------------------------
Asia
Europe Americas Pacific Africa Corporate Total
--------- -------- -------- -------- --------- --------
Gross revenue
from external
customers $308,329 $337,024 $298,311 $143,875 $ -- $1,087,539
======== ======== ======== ======== ======== ==========
Net revenue $ 90,879 $188,667 $ 63,801 $ 89,476 $ -- $ 432,823
Staff costs 52,750 109,031 26,607 39,659 3,713 231,760
Depreciation
and
amortization 3,200 2,992 1,538 2,191 829 10,750
Amortization
of intangible
assets -- 446 -- 38 -- 484
Other
operating
expenses 27,037 63,833 16,012 34,821 4,022 145,725
-------- -------- -------- -------- --------- ---------
Operating
income/
(loss) $ 7,892 $ 12,365 $ 19,644 $ 12,767 $ (8,564) 44,104
======== ======== ======== ======== =========
Interest
income, net 967
Losses on
foreign
exchange (12)
----------
Pretax income 45,059
Provision for
income taxes (11,173)
----------
Income before
minority
interests $ 33,886
==========
Nine Months Ended October 31, 2002
(Unaudited)
------------------------------------------------------
Asia
Europe Americas Pacific Africa Corporate Total
-------- -------- -------- -------- --------- --------
Gross revenues
from external
customers $271,889 $212,213 $246,688 $101,208 $ -- $831,998
======== ======== ======== ======== ======== ========
Net revenues $ 72,742 $ 82,792 $ 51,804 $ 64,653 $ -- $271,991
Staff costs 39,068 47,384 21,630 24,793 3,169 136,044
Depreciation
and
amortization 2,492 1,923 1,448 1,337 417 7,617
Amortization
of intangible
assets -- 70 -- -- -- 70
Other
operating
expenses 20,918 28,405 14,555 27,185 3,601 94,664
-------- -------- -------- -------- -------- --------
Operating
income/(loss) $ 10,264 $ 5,010 $ 14,171 $ 11,338 $ (7,187) 33,596
======== ======== ======== ======== ========
Interest
expense, net (426)
Losses on
foreign
exchange (709)
--------
Pretax income 32,461
Provision for
income taxes (9,185)
--------
Income before
minority
interests $ 23,276
========
UTi Worldwide Inc.
Reconciliation of Non-U.S. GAAP Measure to U.S. GAAP Measure
(in thousands)
Three Months Ended Nine Months Ended
------------------- ------------------
October 31, October 31,
------------------- ------------------
2003 2002 2003 2002
--------- --------- --------- --------
(Unaudited) (Unaudited)
OPERATING PROFIT RATIO
Operating income,
per U.S. GAAP $ 17,973 $ 14,238 $ 44,104 $ 33,596
Less: Operating income for
Standard Corporation,
per U.S. GAAP 1,445 828 4,489 828
-------- -------- -------- --------
Adjusted operating income $ 16,528 $ 13,410 $ 39,615 $ 32,768
======== ======== ======== ========
Divided by:
Net revenue, per U.S. GAAP $156,545 $107,529 $432,823 $271,991
Less: Net revenue for
Standard Corporation,
per U.S. GAAP 38,987 12,728 114,188 12,728
-------- -------- -------- --------
Adjusted net revenue $117,558 $ 94,801 $318,635 $259,263
======== ======== ======== ========
Operating Profit Ratio, a
non- U.S. GAAP measure 14.1% 14.1% 12.4% 12.6%
======== ======== ======== ========