As logistics became more complicated because of the pandemic, it helped Eden Prairie-based C.H. Robinson. However, even with a 55.7% increase, the company's fourth-quarter earnings missed analysts' expectations.
World's logistical problems mean huge increase in business for Eden Prairie's C.H. Robinson
But while earnings grew 55.7% in the fourth quarter, they still did not meet Wall Street expectations.
February 2, 2022 at 5:15PM
"In the face of some of the greatest disruption and tightest capacity the logistics industry has ever seen, C.H Robinson demonstrated strength, resilience and commitment to our global customers in 2021," said Bob Biesterfeld, chief executive of C.H. Robinson.
But with more business — and more effort to meet shipping needs — comes more costs. Employment increased 13% in 2021 to 16,877 workers, resulting in 35.8% more personnel costs in the quarter and 24.2% for the year.
"The quarter was disappointing, as earnings missed expectations. Shipping volumes and sales remained solid. However, rising expenses were an issue," wrote analyst Jeff Windau, who covers C.H. Robinson for Edward Jones, in a note to investors.
For the quarter, the company earned $230.1 million, or $1.74 a share, compared with $147.8 million, or $1.08 a share, in the same period in 2020.
Total revenue for the quarter increased 43% to $6.5 billion, aided by higher pricing and volumes across most of C.H. Robinson's businesses.
For 2021, C.H. Robinson reached records for revenue and earnings. Net income increased more than 67% to $844.2 million, or $6.31 a share, which also missed expectations. Revenue was up 42.5% to $23.1 billion.
Technology investments showed in the North American Surface Transportation segment. More customers used the company's proprietary pricing engine to book shipments, contributing to a 26% jump in the segment's revenue.
Demand still exceeds supply in global shipping, with C.H. Robinson teams helping customers balance shipments between ocean freight and air cargo, Biesterfeld said. As a result, revenue in the Global Forwarding unit doubled to $2.1 billion.
A record 10,000 carriers signed onto C.H. Robinson's platforms in the fourth quarter, increasing options for customers, Biesterfeld said.
Shares of C.H. Robinson closed Wednesday at $92.54 a share, down 11.5%. Shares over the last 52 weeks have ranged between $84.67 and $112.15 a share.
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