UTi Worldwide fiscal 3Q profit up 47%

UTi Worldwide Inc's fiscal third-quarter profit increased 47 percent, beating analysts' expectations, as revenue climbed less than expected but margins rose, reported Dow Jones Newswires.

The freight forwarding company, which resells cargo space and handles customs clearance and warehousing for companies needing to move goods, has benefited from improved demand of late. But the sector has had a hard time passing on cargo carriers' price increases to customers and faces uncertain shipping volume prospects as the pace of economic recovery has slowed.

Chief executive Eric Kirchner attributed the latest quarter's strength to "higher volumes and greater operating efficiency, partially offset by lower yields."

For the quarter ended October 31, UTi posted a profit of US$26.4 million, or 26 cents a share, up from $18 million, or 18 cents, a year earlier. Revenue jumped 24 percent to $1.2 billion following a 20 percent drop last year, and was up 12 percent excluding purchased transportation costs.

Analysts polled by Thomson Reuters most recently forecast a profit of 25 cents on $1.22 billion in revenue.

Operating margin excluding purchase transportation widened to 10.8 percent from 8.7 percent.

Freight forwarding revenue climbed 31 percent as operating income jumped 57 percent. Contract logistics and distribution revenue, a much smaller portion of the company's total, was up 9.8 percent.
(Source:www.cargonewsasia.com)