Expeditors International of Washington, Inc. EXPD today announced third quarter 2018 financial results including the following highlights compared to the same quarter of 2017:
- Diluted Net Earnings Attributable to Shareholders per share (EPS1) increased 39% to $0.92
- Net Earnings Attributable to Shareholders increased 35% to $163 million
- Operating Income increased 9% to $203 million
- Revenues increased 16% to $2.1 billion
- Net Revenues2 increased 10% to $661 million
- Airfreight tonnage volume increased 1% and ocean container volume increased 8%
"We generated record third quarter profitability, with the highest net revenue and operating income in our history, as we continued to win new business and grow volumes with existing customers in an unpredictable rate environment," said Jeffrey S. Musser, President and Chief Executive Officer. "Capacity in both the air and ocean markets remained tight in many lanes. Carriers continued to take advantage of the supply and demand imbalance and sought opportunities to increase pricing in an effort to improve profitability. That presented a challenge, particularly in ocean, requiring that we work our strong relationships to secure space for our customers, while remaining disciplined on pricing.
"We continue to focus on providing outstanding service to our customers, especially in these times of uncertainty surrounding potential trade conflicts," Mr. Musser continued. "Rates have been particularly volatile, but we have managed through similar cycles throughout our history and are adept at making adjustments to deliver quality growth over the long term. I commend our people for their exceptional efforts on behalf of our customers and our organization."
Bradley S. Powell, Senior Vice President and Chief Financial Officer, added, "We managed expenses well during a period of rapid changes in pricing to drive operational efficiency (operating income as a percentage of net revenue) back above 30%. Once again, our double-digit net revenue increase outpaced our growth in headcount, as we invest in people, new projects, and core technologies in support of profitable growth." Mr. Powell also noted that the Company's effective tax rate for the three months was 21.8%, compared to 36.7% a year ago. In addition to the lower U.S. federal tax rate that resulted from the 2017 Tax Act, the effective tax rate in the most recent quarter benefited from certain discrete adjustments as a result of recent interpretations related to the 2017 Tax Act amounts and a State income tax refund. Mr. Powell emphasized that the Company's effective tax rate in future periods will largely depend on the mix of pretax earnings that are generated in its U.S. versus foreign operations, further interpretation and guidance to be issued on the new tax law and discrete items that occur in the reporting periods.
Expeditors is a global logistics company headquartered in Seattle, Washington. The Company employs trained professionals in 177 district offices and numerous branch locations located on six continents linked into a seamless worldwide network through an integrated information management system. Services include the consolidation or forwarding of air and ocean freight, customs brokerage, vendor consolidation, cargo insurance, time-definite transportation, order management, warehousing and distribution and customized logistics solutions.
_______________________ |
1Diluted earnings attributable to shareholders per share. |
2Non-GAAP measure calculated as revenues less directly related operating expenses attributable to the Company's principal services. See reconciliation on the last page of this release. |
NOTE: See Disclaimer on Forward-Looking Statements on the following page of this release. |
Disclaimer on Forward-Looking Statements:
Certain portions of this release contain forward-looking statements, which are based on certain assumptions and expectations of future events that are subject to risks and uncertainties, including comments on our ability to secure space for our customers at a reasonable cost, manage through a volatile rate cycle, deliver quality growth over the long term, manage expenses, drive operational efficiency, and generate profitable market growth; the impact of the 2017 Tax Act and related interpretations on our effective tax rate; energy and fuel prices; political changes; changes and uncertainties in governmental policies and inter-governmental disputes; foreign exchange rates; regulatory actions or changes; and risk factors and uncertainties detailed in our Annual Report as updated by our reports on Form 10-Q, filed with the Securities and Exchange Commission.
Expeditors International of Washington, Inc. | |||||||||||||||||||||
Third Quarter 2018 Earnings Release, November 6, 2018 | |||||||||||||||||||||
Financial Highlights for the Nine months ended September 30, 2018 and 2017 (Unaudited) | |||||||||||||||||||||
(in 000's of US dollars except per share data) |
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Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||
2018 | 2017 |
% |
2018 | 2017 |
% |
||||||||||||||||
Revenues1 | $ | 2,090,947 | $ | 1,802,166 | 16% | $ | 5,902,768 | $ | 5,019,577 | 18% | |||||||||||
Net revenues2 | $ | 661,314 | $ | 599,142 | 10% | $ | 1,939,698 | $ | 1,690,380 | 15% | |||||||||||
Operating income3 | $ | 203,154 | $ | 186,895 | 9% | $ | 579,556 | $ | 501,249 | 16% | |||||||||||
Net earnings attributable to shareholders4 | $ | 162,692 | $ | 120,263 | 35% | $ | 438,989 | $ | 322,378 | 36% | |||||||||||
Diluted earnings attributable to shareholders per share | $ | 0.92 | $ | 0.66 | 39% | $ | 2.46 | $ | 1.77 | 39% | |||||||||||
Basic earnings attributable to shareholders per share | $ | 0.94 | $ | 0.67 | 40% | $ | 2.51 | $ | 1.79 | 40% | |||||||||||
Diluted weighted average shares outstanding | 177,173 | 181,788 | 178,447 | 181,951 | |||||||||||||||||
Basic weighted average shares outstanding | 173,394 | 179,416 | 174,675 | 179,827 |
_______________________ |
1Effective January 1, 2018, the Company adopted required new revenue recognition guidance, resulting in a $22 million net reduction to the opening balance of retained earnings. In addition, in conjunction with the adoption of new revenue recognition guidance, the Company also changed the presentation of certain warehouse and distribution revenues from a net to a gross basis, which increased both revenues and operating expenses in customs brokerage and other services by approximately $50 million in each of the three quarters of 2018. Comparative prior year revenues (and the related volume information in the table below) has not been adjusted and continue to be reported under the Company's historical policies. 2018 reported revenues (and the related volume information) are reported under the Company's new revenue recognition accounting policies. |
2Non-GAAP measure calculated as revenues less directly related operating expenses attributable to the Company's principal services. See reconciliation on the last page of this release. |
3The year-to-date period ended September 30, 2017 includes the recovery of certain legal and related fees totaling $8 million and the favorable resolution of an indirect tax contingency of $6 million. |
4The Company's consolidated effective income tax rate was 21.8% and 26.1%, respectively, for the three and nine-month periods ended September 30, 2018 as compared to 36.7% and 37.1% for the comparable periods in 2017. In addition to the lower U.S. federal tax rate that resulted from the 2017 Tax Act, the effective tax rate in 2018 benefited from significant share-based compensation deductions principally as a result of stock option exercises occurring during the second quarter of 2018, required discrete adjustments as a result of interpretations related to the 2017 Tax Act and a State income tax refund during the third quarter of 2018. |
During the three and nine-month periods ended September 30, 2018, we repurchased 2.0 million and 7.8 million shares of common stock at an average price of $73.47 and $71.58 per share, respectively. During the three and nine-month periods ended September 30, 2017, we repurchased 3.6 million and 6.1 million shares of common stock at an average price of $56.18 and $55.93 per share, respectively.
Employee Full-time |
||||
2018 | 2017 | |||
North America | 6,635 | 6,061 | ||
Europe | 3,270 | 2,950 | ||
North Asia | 2,655 | 2,671 | ||
South Asia | 1,640 | 1,613 | ||
Middle East, Africa and India | 1,478 | 1,516 | ||
Latin America | 831 | 802 | ||
Information Systems | 904 | 877 | ||
Corporate | 351 | 379 | ||
Total | 17,764 | 16,869 | ||
Third quarter year-over-year percentage |
||||
Airfreight kilos | Ocean freight FEU | |||
2018 | ||||
July | 2% | 7% | ||
August | 5% | 7% | ||
September | (4)% | 9% | ||
Quarter | 1% | 8% | ||
_______________________
Investors may submit written questions via e-mail to: investor@expeditors.com. Questions received by the end of business on November 9, 2018 will be considered in management's 8-K "Responses to Selected Questions" expected to be filed on or about November 29, 2018.
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. | |||||||||
AND SUBSIDIARIES | |||||||||
Condensed Consolidated Balance Sheets | |||||||||
(In thousands, except per share data) | |||||||||
(Unaudited) | |||||||||
September 30, |
December 31, |
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Assets |
|||||||||
Current Assets: | |||||||||
Cash and cash equivalents | $ | 990,612 | $ | 1,051,099 | |||||
Accounts receivable, less allowance for doubtful accounts of $13,696 at September 30, 2018 and $12,858 at December 31, 2017 | 1,528,524 | 1,414,741 | |||||||
Deferred contract costs | 168,090 | — | |||||||
Other current assets | 59,247 | 75,612 | |||||||
Total current assets | 2,746,473 | 2,541,452 | |||||||
Property and equipment, less accumulated depreciation and amortization of $441,433 at September 30, 2018 and $420,282 at December 31, 2017 | 510,328 | 525,203 | |||||||
Goodwill | 7,927 | 7,927 | |||||||
Deferred Federal and state income taxes, net | 43,293 | 13,207 | |||||||
Other assets, net | 26,779 | 29,219 | |||||||
$ | 3,334,800 | $ | 3,117,008 | ||||||
Liabilities and Equity |
|||||||||
Current Liabilities: | |||||||||
Accounts payable | $ | 934,509 | $ | 866,305 | |||||
Accrued expenses, primarily salaries and related costs | 228,785 | 206,320 | |||||||
Contract liabilities | 195,035 | — | |||||||
Federal, state and foreign income taxes | 19,139 | 20,494 | |||||||
Total current liabilities | 1,377,468 | 1,093,119 | |||||||
Noncurrent Federal income taxes payable | — | 29,516 | |||||||
Commitments and contingencies | |||||||||
Shareholders' Equity: | |||||||||
Preferred stock; none issued | — | — | |||||||
Common stock, par value $0.01 per share. Issued and outstanding 172,564 shares at September 30, 2018 and 176,374 shares at December 31, 2017 | 1,726 | 1,764 | |||||||
Additional paid-in capital | 1,832 | 546 | |||||||
Retained earnings | 2,053,389 | 2,063,512 | |||||||
Accumulated other comprehensive loss | (101,098 | ) | (73,964 | ) | |||||
Total shareholders' equity | 1,955,849 | 1,991,858 | |||||||
Noncontrolling interest | 1,483 | 2,515 | |||||||
Total equity | 1,957,332 | 1,994,373 | |||||||
$ | 3,334,800 | $ | 3,117,008 | ||||||
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. | ||||||||||||||||||
AND SUBSIDIARIES | ||||||||||||||||||
Condensed Consolidated Statements of Earnings | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||
Revenues: | ||||||||||||||||||
Airfreight services | $ | 833,338 | $ | 735,164 | $ | 2,366,326 | $ | 2,022,577 | ||||||||||
Ocean freight and ocean services | 585,810 | 563,386 | 1,636,701 | 1,585,730 | ||||||||||||||
Customs brokerage and other services | 671,799 | 503,616 | 1,899,741 | 1,411,270 | ||||||||||||||
Total revenues | 2,090,947 | 1,802,166 | 5,902,768 | 5,019,577 | ||||||||||||||
Operating Expenses: | ||||||||||||||||||
Airfreight services | 620,554 | 547,595 | 1,727,383 | 1,490,417 | ||||||||||||||
Ocean freight and ocean services | 435,313 | 411,061 | 1,199,887 | 1,163,051 | ||||||||||||||
Customs brokerage and other services | 373,766 | 244,368 | 1,035,800 | 675,729 | ||||||||||||||
Salaries and related costs | 351,577 | 319,050 | 1,042,420 | 930,159 | ||||||||||||||
Rent and occupancy costs | 38,202 | 30,533 | 113,186 | 87,826 | ||||||||||||||
Depreciation and amortization | 13,335 | 12,272 | 40,833 | 36,241 | ||||||||||||||
Selling and promotion | 10,632 | 10,608 | 32,385 | 32,476 | ||||||||||||||
Other | 44,414 | 39,784 | 131,318 | 102,429 | ||||||||||||||
Total operating expenses | 1,887,793 | 1,615,271 | 5,323,212 | 4,518,328 | ||||||||||||||
Operating income | 203,154 | 186,895 | 579,556 | 501,249 | ||||||||||||||
Other Income (Expense): | ||||||||||||||||||
Interest income | 4,704 | 3,444 | 14,171 | 9,565 | ||||||||||||||
Other, net | 566 | 96 | 2,357 | 2,584 | ||||||||||||||
Other income (expense), net | 5,270 | 3,540 | 16,528 | 12,149 | ||||||||||||||
Earnings before income taxes | 208,424 | 190,435 | 596,084 | 513,398 | ||||||||||||||
Income tax expense | 45,357 | 69,829 | 155,871 | 190,470 | ||||||||||||||
Net earnings | 163,067 | 120,606 | 440,213 | 322,928 | ||||||||||||||
Less net earnings attributable to the noncontrolling interest | 375 | 343 | 1,224 | 550 | ||||||||||||||
Net earnings attributable to shareholders | $ | 162,692 | $ | 120,263 | $ | 438,989 | $ | 322,378 | ||||||||||
Diluted earnings attributable to shareholders per share | $ | 0.92 | $ | 0.66 | $ | 2.46 | $ | 1.77 | ||||||||||
Basic earnings attributable to shareholders per share | $ | 0.94 | $ | 0.67 | $ | 2.51 | $ | 1.79 | ||||||||||
Dividends declared and paid per common share | $ | — | $ | — | $ | 0.45 | $ | 0.42 | ||||||||||
Weighted average diluted shares outstanding | 177,173 | 181,788 | 178,447 | 181,951 | ||||||||||||||
Weighted average basic shares outstanding | 173,394 | 179,416 | 174,675 | 179,827 | ||||||||||||||
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. | |||||||||||||||||||
AND SUBSIDIARIES | |||||||||||||||||||
Condensed Consolidated Statements of Cash Flows | |||||||||||||||||||
(In thousands) | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Operating Activities: | |||||||||||||||||||
Net earnings | $ | 163,067 | $ | 120,606 | $ | 440,213 | $ | 322,928 | |||||||||||
Adjustments to reconcile net earnings to net cash from operating activities: | |||||||||||||||||||
Provision for losses on accounts receivable | 1,969 | 1,741 | 2,232 | 3,187 | |||||||||||||||
Deferred income tax expense | (23,610 | ) | (28,854 | ) | (17,522 | ) | (16,000 | ) | |||||||||||
Stock compensation expense | 13,902 | 11,210 | 43,171 | 39,036 | |||||||||||||||
Depreciation and amortization | 13,335 | 12,272 | 40,833 | 36,241 | |||||||||||||||
Other, net | 666 | 377 | 770 | (148 | ) | ||||||||||||||
Changes in operating assets and liabilities: | |||||||||||||||||||
Increase in accounts receivables | (210,092 | ) | (126,102 | ) | (156,321 | ) | (123,790 | ) | |||||||||||
Increase in accounts payable and accrued expenses | 115,629 | 61,833 | 127,860 | 96,132 | |||||||||||||||
Increase in deferred contract costs | (34,623 | ) | — | (51,235 | ) | — | |||||||||||||
Increase in contract liabilities | 36,256 | — | 49,149 | — | |||||||||||||||
Increase (decrease) in income taxes payable, net | 9,292 | 38,149 | (9,258 | ) | 10,814 | ||||||||||||||
Decrease (increase) in other current assets | 930 | (5,872 | ) | 862 | (6,147 | ) | |||||||||||||
Net cash from operating activities | 86,721 | 85,360 | 470,754 | 362,253 | |||||||||||||||
Investing Activities: | |||||||||||||||||||
Purchase of property and equipment | (11,733 | ) | (34,462 | ) | (37,642 | ) | (67,603 | ) | |||||||||||
Other, net | 1,109 | (261 | ) | (886 | ) | (892 | ) | ||||||||||||
Net cash from investing activities | (10,624 | ) | (34,723 | ) | (38,528 | ) | (68,495 | ) | |||||||||||
Financing Activities: | |||||||||||||||||||
Proceeds from issuance of common stock | 47,806 | 65,915 | 169,566 | 162,781 | |||||||||||||||
Repurchases of common stock | (147,828 | ) | (202,776 | ) | (555,760 | ) | (340,736 | ) | |||||||||||
Dividends paid | — | — | (79,180 | ) | (75,726 | ) | |||||||||||||
Payments for taxes related to net share settlements | — | — | (3,215 | ) | — | ||||||||||||||
Distributions to noncontrolling interest | (633 | ) | — | (633 | ) | — | |||||||||||||
Purchase of noncontrolling interest | (613 | ) | — | (613 | ) | — | |||||||||||||
Net cash from financing activities | (101,268 | ) | (136,861 | ) | (469,835 | ) | (253,681 | ) | |||||||||||
Effect of exchange rate changes on cash and cash equivalents | (5,071 | ) | 4,758 | (22,878 | ) | 18,932 | |||||||||||||
(Decrease) increase in cash and cash equivalents | (30,242 | ) | (81,466 | ) | (60,487 | ) | 59,009 | ||||||||||||
Cash and cash equivalents at beginning of period | 1,020,854 | 1,114,910 | 1,051,099 | 974,435 | |||||||||||||||
Cash and cash equivalents at end of period | $ | 990,612 | $ | 1,033,444 | $ | 990,612 | $ | 1,033,444 | |||||||||||
Taxes paid: | |||||||||||||||||||
Income taxes | $ | 59,313 | $ | 58,257 | $ | 183,444 | $ | 190,911 | |||||||||||
EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. | |||||||||||||||||||||||||||||||||||
AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||
Business Segment Information | |||||||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||||
UNITED |
OTHER |
LATIN |
NORTH |
SOUTH |
EUROPE |
MIDDLE |
ELIMI- |
CONSOLI- |
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Three months ended September 30, 2018: | |||||||||||||||||||||||||||||||||||
Revenues from unaffiliated customers | $ | 597,183 | 88,877 | 39,389 | 741,997 | 198,537 | 312,724 | 112,240 | — | 2,090,947 | |||||||||||||||||||||||||
Transfers between geographic areas | 31,860 | 3,998 | 4,054 | 6,592 | 6,855 | 14,488 | 5,807 | (73,654 | ) | — | |||||||||||||||||||||||||
Total revenues | $ | 629,043 | 92,875 | 43,443 | 748,589 | 205,392 | 327,212 | 118,047 | (73,654 | ) | 2,090,947 | ||||||||||||||||||||||||
Net revenues | $ | 283,807 | 34,411 | 15,808 | 146,890 | 47,166 | 99,794 | 34,055 | (617 | ) | 661,314 | ||||||||||||||||||||||||
Operating income | $ | 79,567 | 10,476 | 2,409 | 72,823 | 15,543 | 15,658 | 6,671 | 7 | 203,154 | |||||||||||||||||||||||||
Identifiable assets | $ | 1,694,556 | 174,402 | 53,322 | 540,465 | 156,887 | 508,855 | 212,817 | (6,504 | ) | 3,334,800 | ||||||||||||||||||||||||
Capital expenditures | $ | 6,889 | 301 | 227 | 1,280 | 910 | 751 | 1,375 | — | 11,733 | |||||||||||||||||||||||||
Depreciation and amortization | $ | 8,185 | 497 | 375 | 1,319 | 554 | 1,958 | 447 | — | 13,335 | |||||||||||||||||||||||||
Equity | $ | 1,334,952 | 66,399 | 25,663 | 197,939 | 86,048 | 157,973 | 119,718 | (31,360 | ) | 1,957,332 | ||||||||||||||||||||||||
Three months ended September 30, 2017: | |||||||||||||||||||||||||||||||||||
Revenues from unaffiliated customers | $ | 476,575 | 65,544 | 24,181 | 686,915 | 170,225 | 273,606 | 105,120 | — | 1,802,166 | |||||||||||||||||||||||||
Transfers between geographic areas | 26,888 | 2,782 | 3,679 | 5,253 | 5,681 | 10,302 | 5,318 | (59,903 | ) | — | |||||||||||||||||||||||||
Total revenues | $ | 503,463 | 68,326 | 27,860 | 692,168 | 175,906 | 283,908 | 110,438 | (59,903 | ) | 1,802,166 | ||||||||||||||||||||||||
Net revenues | $ | 257,030 | 30,664 | 14,710 | 138,667 | 41,411 | 85,390 | 29,956 | 1,314 | 599,142 | |||||||||||||||||||||||||
Operating income | $ | 74,645 | 9,215 | 2,652 | 72,070 | 11,697 | 11,124 | 5,495 | (3 | ) | 186,895 | ||||||||||||||||||||||||
Identifiable assets | $ | 1,636,293 | 100,651 | 52,238 | 446,826 | 143,893 | 473,509 | 212,210 | 3,261 | 3,068,881 | |||||||||||||||||||||||||
Capital expenditures | $ | 7,398 | 263 | 2,436 | 589 | 390 | 23,138 | 248 | — | 34,462 | |||||||||||||||||||||||||
Depreciation and amortization | $ | 7,905 | 405 | 310 | 1,313 | 569 | 1,309 | 461 | — | 12,272 | |||||||||||||||||||||||||
Equity | $ | 1,345,266 | 52,212 | 25,709 | 231,831 | 102,477 | 139,688 | 119,649 | (35,751 | ) | 1,981,081 | ||||||||||||||||||||||||
UNITED |
OTHER NORTH AMERICA |
LATIN AMERICA |
NORTH |
SOUTH |
EUROPE |
MIDDLE |
ELIMI- |
CONSOLI- DATED |
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Nine months ended September 30, 2018: | |||||||||||||||||||||||||||||||||||
Revenues from unaffiliated customers | $ | 1,699,323 | 245,670 | 110,808 | 2,046,670 | 539,833 | 934,466 | 325,998 | — | 5,902,768 | |||||||||||||||||||||||||
Transfers between geographic areas | 91,546 | 11,536 | 11,362 | 18,735 | 20,237 | 43,501 | 16,591 | (213,508 | ) | — | |||||||||||||||||||||||||
Total revenues | $ | 1,790,869 | 257,206 | 122,170 | 2,065,405 | 560,070 | 977,967 | 342,589 | (213,508 | ) | 5,902,768 | ||||||||||||||||||||||||
Net revenues | $ | 832,872 | 99,607 | 46,476 | 424,681 | 136,458 | 300,800 | 100,381 | (1,577 | ) | 1,939,698 | ||||||||||||||||||||||||
Operating income | $ | 212,843 | 29,571 | 7,480 | 213,105 | 44,049 | 51,894 | 20,599 | 15 | 579,556 | |||||||||||||||||||||||||
Identifiable assets at period end | $ | 1,694,556 | 174,402 | 53,322 | 540,465 | 156,887 | 508,855 | 212,817 | (6,504 | ) | 3,334,800 | ||||||||||||||||||||||||
Capital expenditures | $ | 16,092 | 4,020 | 899 | 2,623 | 1,934 | 9,167 | 2,907 | — | 37,642 | |||||||||||||||||||||||||
Depreciation and amortization | $ | 25,397 | 1,368 | 1,138 | 3,998 | 1,679 | 5,889 | 1,364 | — | 40,833 | |||||||||||||||||||||||||
Equity | $ | 1,334,952 | 66,399 | 25,663 | 197,939 | 86,048 | 157,973 | 119,718 | (31,360 | ) | 1,957,332 | ||||||||||||||||||||||||
Nine months ended September 30, 2017: | |||||||||||||||||||||||||||||||||||
Revenues from unaffiliated customers | $ | 1,354,811 | 187,997 | 69,747 | 1,873,393 | 475,163 | 764,596 | 293,870 | — | 5,019,577 | |||||||||||||||||||||||||
Transfers between geographic areas | 79,356 | 8,246 | 11,073 | 15,139 | 16,520 | 29,288 | 15,316 | (174,938 | ) | — | |||||||||||||||||||||||||
Total revenues | $ | 1,434,167 | 196,243 | 80,820 | 1,888,532 | 491,683 | 793,884 | 309,186 | (174,938 | ) | 5,019,577 | ||||||||||||||||||||||||
Net revenues | $ | 737,842 | 84,630 | 43,634 | 371,459 | 117,634 | 242,244 | 89,973 | 2,964 | 1,690,380 | |||||||||||||||||||||||||
Operating income | $ | 191,256 | 26,583 | 8,349 | 183,515 | 37,434 | 36,189 | 17,928 | (5 | ) | 501,249 | ||||||||||||||||||||||||
Identifiable assets at period end | $ | 1,636,293 | 100,651 | 52,238 | 446,826 | 143,893 | 473,509 | 212,210 | 3,261 | 3,068,881 | |||||||||||||||||||||||||
Capital expenditures | $ | 19,492 | 1,066 | 3,648 | 2,492 | 1,172 | 38,717 | 1,016 | — | 67,603 | |||||||||||||||||||||||||
Depreciation and amortization | $ | 23,389 | 1,163 | 930 | 3,995 | 1,656 | 3,707 | 1,401 | — | 36,241 | |||||||||||||||||||||||||
Equity | $ | 1,345,266 | 52,212 | 25,709 | 231,831 | 102,477 | 139,688 | 119,649 | (35,751 | ) | 1,981,081 | ||||||||||||||||||||||||
Net Revenues (Non-GAAP measure)
We commonly refer to the term "net revenues" when commenting about our Company and the results of its operations. Net revenues are a Non-GAAP measure calculated as revenues less directly related operations expenses attributable to the Company's principal services. We believe that net revenues are a better measure than are total revenues when analyzing and discussing our effectiveness in managing our principal services since total revenues earned as a freight consolidator must consider the carriers' charges to us for carrying the shipment, whereas revenues earned in other capacities include primarily the commissions and fees earned by us. Net revenues are one of our primary operational and financial measures and demonstrates our ability to concentrate and leverage purchasing power through effective consolidation of shipments from customers utilizing a variety of transportation carriers and optimal routings. Using net revenues also provides a commonality for comparison among various services. The following table presents the calculation of net revenues.
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
(in thousands) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Total revenues | $ | 2,090,947 | $ | 1,802,166 | $ | 5,902,768 | $ | 5,019,577 | |||||||
Expenses: | |||||||||||||||
Airfreight services | 620,554 | 547,595 | 1,727,383 | 1,490,417 | |||||||||||
Ocean freight and ocean services | 435,313 | 411,061 | 1,199,887 | 1,163,051 | |||||||||||
Customs brokerage and other services | 373,766 | 244,368 | 1,035,800 | 675,729 | |||||||||||
Net revenues | $ | 661,314 | $ | 599,142 | $ | 1,939,698 | $ | 1,690,380 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20181106005234/en/
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